Updated EU Guidelines Could Lead to EU Citizenship Program Changes
The EU is currently reviewing citizenship by investment which may lead to changes in EU citizenship programs.
In an effort to maintain security within the European Union, the EU commission has undertaken a review of the applicant process for those seeking EU citizenship. Cyprus is one of the countries facing the most scrutiny given the popularity of its Citizenship by Investment Program (CIP). It has the quickest turnaround of Europe’s CIP with qualified applicants able to obtain a Cyprus passport in only 180 days.
This program enables wealthy investors to secure a second citizenship in Cyprus, in exchange for an inward investment of a minimum of €2 million in real estate or €2.5 million in other pre-approved investments into Cyprus. Another most popular program is Malta’s CIP with an inward investment requirement of €1,150,000 through a combination of real estate and government donations, with a Maltese passport being issued in just over 14 months.
The EU Commission is expected to complete the review of all European Citizenship programs and issue a report around November of this year. The report will include any recommendations to EU governments with regards to their immigration programs and screening processes. Vera Jourova, the European Commissioner for Justice, said the commission’s review was important in order to ensure EU member states “take all preventative steps not to allow bad people with bad intentions to enter the EU.”
Because Cyprus and Malta citizenship provides many benefits including freedom to live and work in the EU, visa-free travel to many key business centres around the world, favourable tax regimes, timely processing and limited residency requirements, these EU CBI programs are considered the most desirable programs in Europe. Although each EU country establishes its own laws, anything with the potential impact on other EU member states is also reviewed, with view to its impact to the EU overall.
To address ongoing pressures from the EU, Cyprus recently completed an update of its CBI program, streamlining it in line with the due diligence and transparency that is required by the EU. These Cyprus program revisions included an updated code of conduct, extending the processing time to 6 months, offering added assurance that applicants for citizenship are thoroughly vetted, and further strengthening the program. The revised CBI program requirements also ensures that best advice is offered according to client needs, within the confines of the investment program criteria.
The government of Cyprus maintains the Cyprus Investment Program is now more robust than ever and that it provides the necessary due diligence and professional conduct required. Cyprus confirms that it welcomes the EU Commission’s report and any recommendations.
Today’s Cyprus and Maltese CBI process is straightforward, with a transparent application process that enforces due diligence. However, as pressure from the EU mounts, such programs are continuously undergoing increased scrutiny. For example, the Cyprus CBI program does not currently include medical testing or language requirements, unlike other EU CBI.
At this time, it is unclear what impact the EU Commission report may have on the Cyprus, Malta, or other EU CIPs. This will come to light once the commission’s findings and recommendations are revealed in November. Although each EU nation does establish their own policies, the EU report may influence changes in EU CBI programs. While Jourova acknowledged the EU Commission’s report will be non-binding, she said that she expected the commission to utilize “all legal and psychological tools” in order to ensure compliance by all countries within the EU.
For those interested in obtaining citizenship in an EU country, it is important to be aware that the upcoming report may trigger future changes to CBI programs. Given the recent updates to the Cyprus CBI programs, there are unlikely to be major program changes as a result of this report, however, those who apply now might face a quicker application process or fewer restrictions on who can qualify for EU citizenship.
Although recommendations that may come about as a result of the EU Commission’s recent fact-finding efforts are currently unknown, Jourova has stated a preference for applicants who have long-standing ties to the EU. Said Jourova, “We want to guarantee that EU citizenship is given to people who really have links with the country where they apply for citizenship,” This approach could mean additional hurdles for those applying for dual citizenship in an EU country, after any recommended program changes have been implemented.
Although both Cyprus and Malta have received considerable attention given they have the most sought-after programs in the EU, the EU Commission report will evaluate all citizenship programs in every EU member state. However, these two countries may be the most likely to be impacted by the EU Commission’s recommendations.
In addition to the possibility of tightening citizenship application requirements after the EU Commission’s recommendations are released, new applicants could encounter processing delays in countries implementing changes to their citizenship application programs. Cyprus, in particular, is known for the quick processing of citizenship applications but any significant changes in a program could result in additional criteria or further processing delays and other hurdles that can be avoided by those applying before any potential revisions are put into place.
Some applicants may not be concerned about a slightly longer process time, however for many other applicants, timing is critical. They may need dual citizenship in order to take advantage of current business opportunities within the EU, or may be obtaining citizenship for their children in order for them to be able to attend university over the next year.
There are numerous reasons why investors seek out dual citizenship within the EU. Applicants may be interested in using EU citizenship as a gateway into the UK, France, Germany, or Spain. For applicants with time-sensitive business, schooling, or personal interests within the EU, even a few weeks or months of additional processing time could mean the loss of a particular opportunity or force their children to delay the start of their university education. Such time considerations could force potential applicants to delay their plans or settle for a less beneficial dual citizenship in a different part of the world.
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