The Council of Ministers of the Republic of Cyprus approved on 13 February 2019 a number of important amendments to the Citizenship by Investment Scheme, now officially termed as Cypriot Investment Scheme (the ‘Scheme’), offered by the country. The most important changes are covered below.
- A mandatory donation of €75,000 to the Foundation for Research and Innovation.
This requirement can be waived under certain conditions, such as investing in an Innovative Business certified as such by the Ministry of Finance or in a certified Social Company. It is also waived where the applicant has made an investment amounting to at least €400,000, under the criterion “Purchase or Establishment or Participation in Cypriot Companies or Businesses”, in a company operating in the primary or secondary sectors of the economy, or in one of the fields of research and technology, education, health, and renewable energy.
- A mandatory donation of €75,000 to the Cyprus Land Development Corporation.
This requirement aims to contribute towards the integrated housing policy, including making available affordable housing projects and the implementation of other housing plans and measures.
- The inclusion of investments in the shipping sector of Cyprus among the eligible investments provided by the Scheme, on the basis of specific measurable criteria.
- The Scheme already offers the option of combining the criterion related to primary residence with the investment criterion in case of investments in residential unit(s) as long as at least one of the units purchased is worth at minimum €500,000. Under such a scenario the total investment made by the investor is reduced to a minimum of €2 million instead of €2.5 million. The new provision introduced in relation to this option provides that for purchases of residential properties already used for the purposes of the Scheme by another investor in the past (i.e. resale), the option will be valid provided that the total investment, will be at least €2.5 million instead of €2 million.
- Both for the permanent residence and any other investment in real estate for qualifying with the Scheme the following documents must be provided:
- a Planning Permission by the Department of Town Planning and Housing
- a Certificate of Completion signed by the architect of the project. Where a property purchased is under construction, there is a requirement for the seller to provide to the investor with a bank guarantee or deposit in to a designated (escrow) account, equal to 5% of the value of the property.
- The inclusion of investments in Registered Alternative Investment Funds among the eligible investments covered by the Scheme, as well as the possibility for these entities to invest up to €200,000 in Cyprus Stock Exchange’s secondary market.
- The minimum period for holding the investment/s made in order to qualify for the Scheme is increased from 3 years to 5 years (for citizenships granted after 15 May 2019).
- The option of investing in Cyprus government bonds, which has been so far available in case of investments in multiple options, as offered by the Scheme, is abolished.
- In case of a mortgaged property, a waiver from the lending institution should be provided, confirming the waiver of any rights upon settlement of the loan.
- The applicant must have a Schengen visa in order to be able to apply for the Scheme.
- An applicant who has applied for the acquisition of citizenship in any other EU Member State and has been rejected, will not be entitled to apply for Cyprus citizenship based on the Scheme.
- Applicants will be subject to an enhanced due diligence process by an international professional services company to which the Ministry of Interior will outsource this process.
It is reminded that the applicant should be in possession of a residence permit in the Republic of Cyprus for at least 6 months prior to naturalization as a Cypriot citizen. If the applicant does not already hold a residence permit, he/she will be able to apply for an immigration permit, together with the submission of the application for citizenship. The 6-month requirement mentioned above will start counting as from the date the immigration permit is issued.
According to the decision, the revised Scheme comes into effect from the date of its publication in the official Gazette of the Republic of Cyprus, which was on 26 February 2019, with the exception of the measures covered by the first four points above, which will be put into effect from 15 May 2019.