Recent decision of the Council of Ministers for the revision – Cyprus Investment Programme
The recent decision of the Council of Ministers for the revision of the Cyprus Investment Programme that was taken on the 13th of February 2019.
The brief outline of the changes of the Programme with immediate effect, are the following:
- According to the Programme the investor should have made the necessary investments during the 3 (three) years preceding the date of the application and must retain the said investments for a period of at least 3 (three) years from the date of the naturalization. However, the Council of Ministers added the provision that the investor may replace the investment during the said period, provided that he/she has obtained beforehand an approval by the Ministry of Finance.
- A further condition has been added providing that an applicant whose application for citizenship in any other member-state of the European Union had been rejected, is not eligible to apply for the acquisition of the Cypriot citizenship through the Cypriot Investment Programme. This condition also applies for the family members of the investor that are eligible to apply for the acquisition of Cypriot citizenship, i.e. for the spouse/partner, the financially dependent children and the parents of the investor. In order to evaluate this condition an additional mandatory document has been added to the application which is a “Declaration by the applicant concerning any citizenship applications he/she may have submitted in any other member-state or member-states of the European Union”. This Declaration needs to be signed before a registrar of a Cypriot court or a consular officer of the Republic of Cyprus. In case the applicant has not submitted any such application in the Declaration he/she needs to assure that he/she has never submitted such an application. This Declaration needs to be provided either in Greek, or in English.
Having in mind that this provision has immediate effect and, consequently, that it is expected that this Declaration to be included in the applications that are currently submitted, the Ministry of Interior will show some sort of flexibility for the applications that will be submitted until the 15th of March 2019. Therefore, applications that do not contain the Declaration will be accepted for submission, but the applicant is obliged to furnish the Declaration in the following days, otherwise the application will not be further examined. However, from the 18th of March 2019 and onwards applications that do not contain the Declaration will not be accepted for submission.
- Concerning the applications of the financially dependent children it is mandatory to include in the application a Due Diligence Report issued through an internationally accepted database ensured through a subscription (e.g. Wolrd Check, LexisNexis Diligence, Regulatory DataCorp Inc. etc.). The report must be dated no later than thirty days from the date of its submission. It goes without saying that the obligation of including a due diligence report in the applications of the investors, the spouses/partners and parents of the investors is still in force.
- The Council of Ministers confirms the condition that the applicant prior to his/her naturalization as a Cypriot citizen must hold a residence permit in Cyprus for a period of at least 6 (six) months. Bear in mind that this six-months period commences on the issuance date of the residence permit (card), therefore on every occasion please make sure that the residence permit (card) of your clients has been issued.
- Concerning criterion Α.2 (Purchase or Establishment or Participation in Cypriot Companies or Businesses) a new clause has been added, which provides that investments in the shipping sector are eligible on the basis of measurable criteria that will be determined jointly by the Ministry of Finance and the Shipping Deputy Ministry. These measurable criteria will be announced in due time. Moreover, the provision that the company’ or companies’ employees (Cypriot or European Union member-states citizens) needed to have resided in Cyprus during the five years preceding the application has been deleted.
- Concerning criterion Α.3 (Investment in Alternative Investment Funds or Registered Alternative Investment Funds or financial assets of Cypriot companies or Cypriot organizations that are licensed by Cyprus Securities and Exchange Commission), as indicated by the title of the Criterion, investments in Registered Alternative Investment Funds (RAIF) are also permitted. Moreover, it has been added that it is permitted for these AIFs or RAIFs to invest in secondary market stock-market values of the Cyprus Stock Exchange an amount that does not exceed the €200.000.
- Concerning criterion A.4 (Combination of criteria) it is noted that the option of investing in state bonds has been removed. In fact investment in state bonds is no longer eligible for the purposes of applying for the Cyprus Investment Programme.