Though the Cypriot economy is booming, the government is taking steps to regulate its investment immigration market to ensure past mistakes aren’t repeated. It’s creating a win-win situation for both developers and investors.
Cyprus Investment Immigration Programs Overview
The Cypriot citizenship by investment program has recently reduced its price tag, allowing applicants to invest 2 million euros in real estate, businesses or selected financial instruments. The Mediterranean island’s CBI program offers investors a low-hassle, fast-tracked pathway to an EU passport, and grants successful applicants the right to live and work anywhere in the European Union.
Investors can enjoy Cyprus for its location, its low taxes and flexible approach that allows CBI applicants to retain their current nationality, and to acquire and maintain Cypriot citizenship without a physical-presence requirement. The Cyprus passport, which allows visa-free travel to 163 countries around the world is another big selling point, though investors who don’t need a new passport can also acquire permanent residency at a significantly reduced cost or take advantage of a new startup visa intended to attract entrepreneurs and innovators.
The latest development of the CBI industry in Cyprus include the government taking steps to gradually regulate the market stakeholders through creating a formal list of approved service providers, the formation of an oversight board and a ban to advertise the program to stop any misleading information, according to the Advisory Committee of the Investment Migration Council.
Applicants to Cyprus’s CBI program must invest at least 2 million euros, maintained for a period of three years. Investments can be made in one of four ways:
- Real estate: The most popular option, allowing investors to qualify by spending 2 million euros or more on residential, commercial or other real estate. Land purchases alone aren’t sufficient to qualify, however.
- Business investments: Investors can qualify by spending 2 million euros to purchase a business with a significant presence in Cyprus. Businesses must employ at least five Cypriot citizens, or longtime Cyprus residents with EU citizenship, in order to qualify.
- Purchase of AIFs: Investors can also qualify by purchasing Alternative Investments Funds, bonds, securities, or other financial assets, issued in Cyprus and linked to companies with substantial presence in Cyprus.
- A combination: Cyprus allows investors to mix and match from the options above, as long as their total investments\ amounts to at least 2 million euros. It’s also possible to purchase up to 500,000 euros in government bonds as part of a combined 2-million euro investment.
Applicants must also purchase a residence in Cyprus, at a minimum cost of 500,000 euros, in order to qualify for the CBI program. The only condition after keeping the investment for the required 3-years, is for the applicant to maintain a residential property of at least 500.000 euros at all times. Investors who are investing solely in real estate are allowed to count their 500,000-euro residential-property investment towards their 2-million euro core investment, effectively reducing the cost of the program by 500,000 euros.
Spouses and dependents can be included in the CBI application, and an applicant’s parents can also qualify if they purchase an additional 500,000-euro residence, or if the investor and their parents jointly purchase a 1-million euro residence.
For investors who don’t need a passport, Cyprus also offers a residency-by-investment program at a sharply reduced cost. Investors must demonstrate that they have an annual income of at least 30,000 euros and depending on the number of dependents applying with the applicant, deposit at least 30,000 euros in a Cyprus bank, and purchase a first-sale residence valued at 300,000 euros or more. At least 200,000 euros of the property investment must be paid in order to start/lodge the P.R. application.
In February 2017, Cyprus also introduced a startup visa on a pilot basis, allocating 150 visas for the program’s first two-year period. The visa grants a two-year residency visa to the founders of businesses with 50,000 euros in startup capital, as long as the companies spend at least 10 percent of their operating costs on research and development. After two years, recipients can qualify for permanent residency as long as their companies are found to be successfully creating jobs, paying taxes, and delivering technological innovation.
HOW TO APPLY
Under new rules, CBI applicants must now hold Cypriot residency for six months before obtaining citizenship. Investors can file their residency and CBI paperwork simultaneously, without making additional investments beyond the minimum CBI requirements, and usually receive residency cards within a few days of filing. CBI applications are approved within six months, and the applicants can have their Cyprus Passports issued upon expiration of the 6 months period starting from the day which they acquire their permanent resident card.
Despite the rule changes, the application process is otherwise very straightforward, with applicants simply expected to send documentation of their investment, along with basic personal documentation including a birth certificate, a passport copy, and a criminal record certificate from both the investor’s country of birth and country of current residence.
Passport-holders gain automatic access to the European Union, with an absolute right to live, work, and own property throughout the region. The Cypriot passport is one of the strongest in the world, allowing unrestricted travel to 163 countries. And passport-holders enjoy virtually no physical-residency requirements.
Cypriot residency isn’t as attractive from a mobility standpoint, however. Cyprus is one of the few EU countries that aren't part of the Schengen area, so residents will have to rely on their existing passports to gain entry to the rest of Europe and will remain subject to their existing visa requirements.
Besides offering a beautiful location and year-round sunny weather, Cyprus is now one of the safest and most stable nations of its size. Cyprus’s CBI program was launched to attract foreign investment following the country’s 2012-13 financial crisis. The strategy has proven largely successful, attracting large numbers of Russian investors, and Cyprus’s economy — supported by tourism, shipping, and newfound natural gas resources — is now on a much firmer footing.
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