By Alessia Ajelli
Less than two years ago, following the path of other EU countries, Italy introduced a new visa and residence permit category called the investor visa. This new visa is available to non-EU investors who are seeking to enter Italy and carry out an investment in the Italian market.
The purpose has been to attract foreign capital that benefits the Italian economy. Available investment types are those connected to Italian companies and corporations, innovative start-up companies, research, education and philanthropic activities. For foreigners moving their fiscal residency to Italy, financial and tax benefits have been also provided.
Introducing the investor visa represents a significant change for Italy when considering that before its introduction, foreigners who wanted to make an investment were not guaranteed the possibility to obtain a visa and residence permit simply because they brought capital into Italy. The investor visa is therefore a crucial tool for the Italian economy. Many expect that, during the next few years, a significant number of high net worth individuals will be interested in applying for it.
Qualifying investment categories
Not all types and amounts of investment qualify for the Italian investor visa. The legislative decree that introduced this new visa category in late 2017 provides clarification on the types of investments or donations that are eligible for the investor visa. Only one of the following types of investment is needed: at least 2 million euros in Italian government bonds; at least 1 million euros in equity instruments of Italian companies/corporations; at least 500,000 euros in innovative start-up companies already incorporated and operating in Italy; or at least 1 million euros in philanthropic activities of public interest in the field of education, immigration, culture, scientific research, recovery of cultural assets and/or landscapes.
Italian government bonds include all instruments issued by the Italian Republic, such as treasury bonds, zero coupon treasury bonds and long-term treasury bonds. Foreigners who intend to invest in start-up companies should bear in mind that only innovative start-up companies can be a target for the investment, meaning that only start-up companies registered in a special section of the Italian Chamber of Commerce Register are qualified for the purposes of the investor visa.
The amounts of the investment are certainly significant, resulting in the fact that not all foreigners might be in the position to participate. The approach taken by the Italian government has been to allow entry to non-EU investors who will have a significant impact on the Italian economy.
Requirements and supporting documents
Foreign investors who want to get an investor visa and residence permit shall satisfy a number of requirements set forth by Italian immigration law. The main condition is that the investment must be made. It shall fall within one of the permitted categories and be performed through funds that are proven to be legal. Applicants shall prove: possession and transferability of the amount their planned investment needs; the origin and legal provenance of the financial resources dedicated to their investment; and the absence of criminal convictions and pending charges.
Mandatory requirements when submitting an application include a declaration of commitment on the use of the funds signed by the applicants and their curriculum vitae, containing details of their academic and professional background. The legality and clear origin of the investment funds are one of the main concerns of the Italian government and, for this reason, controls over this specific aspect are of particular focus. The authorities in charge of processing the applications reserve the right to request that applicants transfer their financial resources to a bank with a registered office in Italy.
This option is often used when the applicants’ finances are in a country considered by anti-money laundering regulations to be a "high-risk" non-EU country, or one that is otherwise blacklisted.
The Italian authorities in charge of the process
The Italian government has created a specific group called the Investor Visa for Italy Committee for evaluating and making decisions regarding investor visa applications. Members of the committee are representatives of the following Italian public institutions: the Ministry of Economic Development, the Ministry of the Interior, the Ministry of Foreign Affairs and International Cooperation, the Italian Special Currency Police Unit (Guardia di Finanza), the Italian Tax Agency (Agenzia delle Entrate), the Italian Trade Agency (Agenzia ICE), and the Financial Intelligence Unit for Italy.
Should the application be related to a philanthropic donation, in addition to the ones listed above, a representative from the Ministry of Cultural Heritage and Activities and Tourism and the Ministry of Education, Universities, and Research is included in the panel. Participation in the Investor Visa for Italy Committee from all these institutions shows that the Italian government wants to involve all parties that can be positively affected by genuine foreign investments.
The application process
The entire procedure for obtaining an investor visa is fully digitalized. Applicants should use the government’s online platform at www.investorvisa.mise.gov.it. First, they must register a personal account. The process starts off by submitting a form and providing all of the supporting documents required by the law.
Upon submission of the application, within one working week, the secretariat of the Investor Visa for Italy Committee carries out a formal check of the application and the documentation provided. If the secretariat deems the application complete and in line with the requirements, the secretariat will forward it to the Investor Visa for Italy Committee for its final evaluation. Should the application be deemed incomplete due to inaccuracies or omissions that are rectifiable, the secretariat will suspend the procedure for 30 days and provide the applicant with a request for supplementary documentation.
Outcomes will be negative and applications rejected if the secretariat deems them unsatisfactory and not in accordance with the criteria established by the law.
Once the application is forwarded to the committee, within the following 30 days the committee communicates the results of the assessment to the applicant, by granting or denying him/her the certificate of impediment (nulla osta), which is the document that will allow the applicant to get the investor visa on his/her passport. During that 30-day period, the Investor Visa for Italy Committee may also request further information to complete the assessment and, if its members deem it necessary, also request applicants to make themselves available for a meeting in person or via video conference in order to gather further information. The Committee’s members shall make their own assessment and the decision of granting the certificate of impediment (nulla osta) is adopted with a majority vote in favour.
In cases of a negative outcome, that rejection does not prevent applicants per se from filing a new application. However, it shall include significant new elements to be taken into consideration.
Reasons for denial include not providing the mandatory elements, submitted certificates being found invalid, forged or otherwise fraudulent.
In case of a positive outcome, applicants will be granted a certificate of no impediment (nulla osta) and they will be required to get their passports stamped with the visa at the Italian embassy or consulate in their country of residency. As mentioned, the Investor Visa for Italy Committee oversees the evaluation of the applications and the investment opportunities described therein and, in this context, is empowered to carry out controls over the correct execution of the investment.
Conditions and features for the retention of the investor visa and residence permit
Within the three months following entry into Italian territory, holders of an investor visa shall execute the investment, send appropriate documentation to the Investor Visa for Italy Committee and maintain the investment for the entire duration of the residence permit.
Withdrawing the investment will cause the revocation of the investor visa and residence permit and, consequently, holders will be obliged to leave the Italian territory. Holders must therefore maintain their original investment. Even if already holding a residence permit, they may not alter the destination of their original investment under any circumstances. Doing so will result into the permit being revoked, making its renewal impossible.
The investor visa’s residence permit has an initial duration of two years and can be renewed for further periods of three years, on the condition that the investment has been fully carried out within the timeframe. The renewal application should be submitted, along with a certificate of approval issued by the Investor Visa for Italy Committee, to the police office at least 60 days before the expiration date of the permit.
Further aspects related to the investor visa and applicable tax regime
Investor visa and residence permit holders have the right to family reunification and, therefore, their dependents — wife/husband, children under 18 years, children over 18 years and parents older than 65 who are dependent on the applicants — may apply for a residence permit for family reasons. Dependents will be entitled to enter Italy and stay with the applicants for the entire duration of their visa and, based on the residence permit for family reasons, they will be entitled to study and work in Italy on the same conditions granted to Italian citizens.
In addition to this, after five years of legal residency in the Italian territory, investor visa and residence permit holders can apply for the EU long-term residence permit with unlimited duration. Eventually, they can apply for Italian citizenship after reaching 10 years of legal residency in Italy.
Investor visa and residence permit holders, in order to do so, shall keep their residence in the Italian territory, without interruption, by not leaving Italy for longer than half the duration of each residence permit granted.
Besides the immigration features described so far, foreign investors who are interested in investing in Italy are offered a specific tax regime. The Italian government, under the 2017 budget law, has introduced a substitute income tax regime on foreign income that is basically represented by the payment of a 100,000-euro yearly substitute tax. Such a beneficial option, also known as flat tax or resident-nondomiciled regime, may be extended to family members by paying an additional substitute tax of 25,000 euros for each family member.
The option, which was introduced starting from Jan. 1, 2017, is automatically renewed each year for up to 15 years. Unless its effects are otherwise terminated, the option is revoked in case of forfeiture.
A beneficial program for Italy
The investor visa and residence permit has been created to attract talent and capital to Italy. It represents one of the measures implemented in the last two years by the Italian government to draw high net worth individuals and their capital to Italy. When paired up with the flat tax, it allows foreign nationals to benefit, both from a fiscal and immigration point of view, from measures specifically designed to back up their decision to choose the Italian market for their investments.
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