The Council of Ministers of the Republic of Cyprus has approved on 13.09.2016 a revised scheme for granting Cypriot citizenship to foreign entrepreneurs/investors.
The main target of the economic policy of the Republic of Cyprus through the revised scheme is to encourage the further Foreign Direct Investment in Cyprus and to attract investors who will choose Cyprus as their basis of residence and economic activity.
The most significant changes are the following;
a) Required investment amount; under the new scheme there is a reduction of the required amount of the investment from €5.0 million to €2.0 million.
b) Major Collective Investments; the revised scheme abolishes the provision for collective investment of €12.5 million, which is being replaced by an individual investment of €2.0 million and the purchase of a residence worth at least €500,000.
c) Governmental bonds; following the changes in the new scheme the investment in government bonds is now restricted to €500.000, from €2.5 million.
d) Bank deposit; it is worth mentioning that the new scheme terminates the provision for granting of the Cypriot citizenship to those with bank deposits worth €5.0 million.
e) Deposits with the Popular Bank Public Company Ltd; it is necessary to be noted that the new scheme revoked the provision concerning persons whose deposits have been impaired due to the measures implemented after the 15th of March 2013.
According to the revised scheme an applicant has to satisfy one of the following economic criteria:
- Investment in real estate, land development and infrastructure projects; the applicant must have made an investment of at least €2.0 million for the purchase or construction of buildings or for the construction of other land development projects such as residential or commercial developments, in the tourism sector or other infrastructure projects.This criterion includes an investment in a buildable land as well, provided that the application will accompanied with a development plan. Furthermore, it must be taken into consideration that the purchase of land in zero growth zones is excluded from this criterion.
- Purchase or incorporation or participation in Cypriot business or companies; the applicant must have made an investment of at least €2.0 million for the purchase, incorporation or participation in businesses or companies, that are based and operating in the Republic of Cyprus. These businesses or companies should evidently have a tangible presence in Cyprus and employ at least five (5) Cypriot citizens or citizens of the European Union.
- Investment in Alternative Investment Organizations or financial assets of Cypriot companies or organizations licensed by the Securities and Exchange Commission: the applicant should invest at least € 2.0 million in Alternative Investment Organization founded in the Republic of Cyprus, which are licensed by the Securities and Exchange Commission (CySEC). For the purposes of confirming that the investments which satisfy the criteria of this scheme will be kept for at least three (3) years, the administrator or auditor of the Fund will inform in writing on a yearly basis the Ministry of Finance and the Ministry of Interior with reference to the value of the initial investment.
- Combination of the aforementioned criteria; the applicant may proceed with the combination of the above criteria, provided that the total value of the investment is at least €2.0 million. In addition, the investor is able to purchase government bonds valued up to €500,000, which are issued by the Public Debt Management Office of Ministry of Finance, provided that the applicant will be the owner for at least three (3) years.
Apart from the above economic criteria an applicant must fulfill the following terms and conditions:
- Clean Criminal record; the applicant must have a clean criminal record. Certificate of Clean Criminal Record from the country of origin and the country of residence (if different) has to be provided
- Residence in the Republic of Cyprus: the applicant must have a permanent privately-owned residence in the Republic of Cyprus, the market value of which must be at least €500.000, plus V.A.T. Additionally, in case the applicant invests in residential property or properties, as described on the economic criterion in real estate, then the applicant will not have to make another purchase of residential property in Republic of Cyprus, if the value of one of the residential property is at least € 500,000, plus VAT, and provided that the residence ownership will be maintained for a lifetime.
- Residence permit; following the recent changes in the scheme, in order for an applicant to obtain citizenship of the Republic of Cyprus, he must have a residence permit in Cyprus. In case where the applicant does not already hold a residence permit, will be able to apply for immigration permit on the basis of Regulation 6 (2) of the Aliens and Immigration Law, simultaneously with the submission of the Citizenship/naturalization application.
The same apply to the adult family members of the investor as well, in case they intend to apply for naturalization. If the application for naturalization is rejected for any reason, the immigration permit, obtained following the provisions of this decision will be revoked immediately.
Furthermore, in accordance with the new scheme the investor’s parents will also be entitled to apply for Cyprus Citizenship provided that they have purchased an additional permanent residence valued at least €500,000 plus VAT where applicable.
The applicant should have concluded the necessary investments during the three years preceding the date of the application and must retain the said investments for a period of at least three years since the date of the Naturalization.
Last but not least, the applications which have been submitted in accordance with the existing scheme dated 19.03.2014 will be examined based on the provisions of the relevant Scheme. The applicants are able to withdraw their application and submit a new one based on the revised scheme. It is essential to note that both of the schemes will be in effect until the 31st of October 2016 inclusively, therefore applicants will be able to choose under which scheme they will apply.
By the 1st of November 2016, only the new criteria will be applicable for obtaining a Cypriot Citizenship by investment.
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