As of the 31st of July 2020, the Parliament of Cyprus has adopted new rules and regulations for the Cyprus Investment Program (“the Program”). The amendments aim to enhance the credibility of the Program by incorporating anti – money laundering laws and regulations in the criteria for granting citizenship by exception. What is more, the amendments provide for the additional regulation of the industry and the firms which assist the investors with their investments and subsequent applications.
Below is a summary of what changes for investors under the new regulations:
1. The minimum amount to be invested remains EUR 2.000.000, which can be invested in one of the following:
- In the primary sector of the economy or in the fields of research and technology, education, health or renewable energy, or
- the creation of developments, such as residential or commercial development, tourism development or other infrastructure, or
- for the purchase or construction of real estate, including investment in building land, provided that the application includes an investment plan for their development.
2. After the approval of the application but before the issuance of the naturalization certificate, the investor must in addition to the investment amount, contribute the amount of EUR 200.000 in total per the below:
- EUR 100.000 to the Cyprus Land Development Organisation and EUR 100,000 to one of the below organisations,
- the Research and Innovation Institute, or
- the Industry and Technology Service, or
- the Renewable Energy Fund, or
- the National Solidarity Fund.
3. The requirement for the acquisition of a permanent residence of value at least EUR 500.000 plus vat remains the same. The investor must maintain the permanent residence for the duration of their life. If the investment is exclusively in real estate, there is no need for the purchase of a permanent residence valued at EUR 500.000, if the investor maintains a permanent residence valued at least EUR 500.000, which has been purchased together with the investment.
4. If the investor or members of their family fall in one of the below categories, they are not eligible for application:
- Politically Exposed Persons,
- People against whom orders for the confiscation of their property have been issued in Europe,
- People who have been convicted for a serious criminal offence or offences the penalty of which is imprisonment for over five years or for other serious criminal offence or offences involving moral obscenity,
- People against whom there is a pending criminal investigation either in Cyprus or abroad, for a criminal offence the penalty of which is imprisonment for over five years or for other serious criminal offences involving moral obscenity,
- People who are related to an entity or a person against which restraining/restrictive measures have been issued by the EU and are still in effect,
- People who were related to an entity or a person, but are no longer related, against which restraining/restrictive measures have been issued by the EU and are still in effect,
- People against whom sanctions have been imposed by the EU or the UN and the sanctions are still in effect or were in effect 12 months prior to the filing of the application for naturalization,
- People who are related to an entity or a person against which restrictive or restraining orders or sanctions have been imposed by the EU or the UN and the sanctions are still valid or were valid 12 months prior to the filing of the application for naturalization,
- People who were related to an entity or a person, but are not related anymore, against which restrictive or restraining orders have been imposed by the EU or the UN and the sanctions are still valid or were valid 12 months prior to the filing of the application for naturalization,
- People wanted by INTERPOL or EUROPOL.
5. Honorary naturalization is qualified.
6. The investor must be in possession of a valid Schengen visa.
7. The investor must produce a clean criminal record at least six months old.
The new regulations brought about additional regulation for the service providers:
1. The register of the service providers which was created last year, will be maintained. The service providers are obliged to comply with Anti – Money Laundering and Counterfeiting Terrorism laws and regulations when assessing a new client who is interested in engaging their services in relation to the Program. In addition, the providers are under the obligation to enter into a retainer agreement with their clients which will contain inter alia the rights and obligations of each party.
2. The three-member regulatory committee, (“the Committee of Supervision and Control”) which is comprised by representatives of the Minister of Interior, the Minister of Finance and Cyprus Invest, will continue to exist. The Committee of Supervision and Control will oversee the incorporation of the new regulations and will be monitoring the individuals who acquired the Cypriot citizenship through the Program, long-term. The Committee of Supervision and Control is also burdened with the task to monitor the service providers and ensure their compliance. The new regulations clarify the duties and obligations of the Committee of Supervision and Control.
The adoption of the new regulations is expected to provide the tools for better and more efficient monitoring of potential applicants and safeguard the reputation of the Program.
The above does not constitute a legal opinion or legal advise under any circumstances. For advise in relation to the Cyprus Investment Program, please contact us.