On the 21st of May 2018, the Council of Ministers of Cyprus updated the criteria for third-country nationals who wish to apply for Cypriot citizenship under the Cyprus Investment Programme (or ‘CIP’) on the basis of subsection (2) of section 111A of the Civil Registry Laws of 2002-2017.
The CIP was initiated to advance the goals of the Republic’s economic and fiscal policy. In the words of the Ministry of Interior: ” One of the main objectives of the economic policy of the Republic of Cyprus is to further encourage Foreign Direct Investment and to attract high net worth individuals to settle and do business in Cyprus. Key factors that make Cyprus an attractive destination for investment, is the highly specialized human capital, the reliable legislative and regulatory framework, the stable tax system and the safety and stability conditions prevailing in the country.”
All third country (i.e. non-EU) nationals are eligible to obtain full Cypriot citizenship under the CIP scheme, provided they meet the specified criteria. The holder of the Cypriot passport may also benefit from the internal market, the opportunities and the stability of the European Union.
The programme’s benefits are particularly appealing for foreign investors as they entitle them to the following:
- The investor and his family can freely reside, work, study, have business in Cyprus, any of the EU-member states as well as in Switzerland, Liechtenstein, Norway and Iceland.
- Travel visa-free to 119 countries and with visa-on-arrival in 36 countries.
- Dual-citizenship is permitted. The investor may retain the citizenship of his/her country of origin.
- There is no requirement of physical residence in the country during or after the application procedure is initiated.
- Minimum investment required is €2 million (excluding VAT where VAT is applicable).
- No donation to the Cyprus government required.
- No language proficiency test is required.
- Right to own property in an EU member-state.
- Fully transparent, fairly simple and relatively fast procedure.
Eligibility of the investor’s family to apply
The applicant’s spouse and any financially dependent minors (i.e. children below the age of 18) also have the right to apply for a Cypriot passport. The option is also available to any dependent children up to the age of 28 provided they are students in the process of obtaining their 1st degree. All the descendants of the persons who have obtained citizenship, may also be regarded as Cypriot and EU citizens.
The application for the spouse and minor children can be submitted either simultaneously with the Investor application or at a later stage.
Dependent parents of the investor also qualify for citizenship provided they own a house of €500,000 + VAT or own a share of €500,000 in a residential property of the main applicant.
The applicant must satisfy all of the conditions listed in section (A) below and meet at least one of the investment options set out in section (B):
A. Conditions for applying for Cyprus citizenship
The applicant must satisfy some conditions in order to be eligible for the fast-track procedure, namely:
- Possess a clean criminal record from the country of origin and/or Cyprus. In addition, the name of the applicant must not appear on the list of persons with ‘frozen’ assets within the EU.
- Must privately own a residence in Cyprus and which must be declared as ‘permanent residence’. The property’s market value must be at least €500,000 (excluding V.A.T.) on the date of application. There is no need to reside in Cyprus either before the filing of the application or after obtaining the citizenship. If the property has been purchased up to three years prior to the application, it will count towards the required investment.
The applicant, prior to his/her naturalization as a Cypriot citizen must hold a residence permit in Cyprus. If the applicant does not already hold a residence permit, he/she may apply for an immigration permit on the basis of Regulation 6(2) of the Aliens and Immigration Law, simultaneously with the application for naturalization. If the application for acquiring an immigration permit is made solely for purposes of acquiring the Cypriot citizenship, in accordance with the provisions of this Programme, there are no other conditions than those stated in both Part A and Part B of this Programme. It is noted that all of the above also apply for the adult members of the family of the investor, who will apply for naturalization. In case the application for naturalization is rejected for any reason, the immigration permit, obtained in accordance with the provisions of this Decision, will be canceled immediately.
B. Investment/financial criteria
Assuming the conditions in section (A) above are satisfied, to qualify for Cypriot citizenship the applicant must invest in Cyprus in one of the following ways:
- Investment in Real Estate
The applicant may invest in immovable property, land development or infrastructure projects.The investment must be at least €2 million for the purchase and/or construction and/or development of the said property or projects. It must be stressed out that if the investor wishes to invest in land under development, a business/development plan of the purchased property needs to be presented to the relevant Authorities for approval. The total investment of €2 million must include at least one residential property with a minimum value of €500.000 (excluding VAT). The residential property must always be kept as ‘permanent residence’ or, if sold, it must be replaced with an another residential property of equal or greater value (see criterion A(3) above).
- Purchase or Incorporation of a Cyprus Company or participation in Cyprus businesses or Cyprus Companies.
The Applicant can invest at least €2 million in order to purchase, incorporate or participate in companies, that have physical presence and activities in Cyprus and employ at least five Cypriot or EU citizens who have been legally residing in Cyprus for a continuous period of at least 5 years prior to the application. The minimum number of employees increases where more than one applicant invests in the same company simultaneously or almost simultaneously.
- Investment in alternative investment funds (AIFs) or financial assets of Cypriot businesses or organizations.
The Applicant can purchase financial assets of at least €2 million from organizations of alternative investment funds (AIFs), which are registered and whose activities are operated in the Republic of Cyprus and are licensed and supervised by the Cyprus Securities and Exchange Commission (the CySEC). Any other investments which are approved by the Ministry of Finance may qualify for the CIP. The manager or the auditor of the Fund is obliged to report to the relevant Ministries on an annual basis, that the initial investment amount is in place.
- Combination of the above
Applicants may opt for a combination of any of the above methods provided that the investments’ total value is at least €2 million. Within this criterion the applicant may purchase special government bonds of the Republic of Cyprus, up to €500.000, which will be issued by the Public Debt Management Office of the Ministry of Finance, on condition that the investor will retain these bonds for a three-year period. The characteristics and the terms of these special bonds will be determined by the General and Special Issue Terms of the Government Bonds of the Republic of Cyprus. Investments in government bonds through the secondary market are not considered eligible.
The entire procedure is quite practical as it does not involve any language requirements, medical tests or personal interviews.
The application (Form 127) is submitted to the Ministry of Interior with original supporting documentation (see section ‘Documentation’ below) and by the relevant fees (2.000 EURO per adult and 80 EURO per minor child). All the documents issued by a foreign authority should be translated either in Greek or in English and be duly certified (via apostille, if applicable). Our lawyers will carry out a pre-clearance check before submitting the application and paying the relevant fees.
If the Investor meets the criteria and conditions set out above, the application is approved by the Ministry of Interior. Approval fee of 5.000 EURO per adult is payable at this stage. The Ministry of Interior then forwards the application to the Council of Ministers for final approval.
Once the application is approved, a Permanent Residence (PR) card is issued. Owning a PR card for six months enables the holder to to complete the naturalisation process which involves the Civil Registry and Migration Department issuing the Certificate of Naturalisation. The Certificate must be signed by the applicant either in the presence of a Registrar of a Cypriot Court or a Consular at any Cypriot Consulate abroad within three months of receiving approval. Once everything is completed, the applicant is entitled to his/her passport which is issued within the next three months.
Any applications regarding the naturalisation of the parents or the children of the appplicant are submitted at this final stage.
The average time for the completion of the process is approximately 3 months from the date of submission. It should be noted that the application submission date is the date on which the submission fees were paid.
The Council of Ministers has complete discretion to approve or reject a Citizenship Application.
The following documents are required to prove compliance with the specified criteria of the citizenship program:
- Certificate of Clean Criminal Record from the country of origin and the country of residence (if it differs).
- 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.
- For the permanent residence property and any other real estate, land development or infrastructure projects investments in the Republic of Cyprus: (a) Contract of Sale, (b) Title Deeds/ Receipt for lodging the contract with the Lands and Surveys Department,(c) Receipts for paying the agreed purchase price, (d) Copy of the wire transfer in the Cypriot commercial banking institution in the name of the seller or the seller’s company and, (e) An evaluation certificate from an independent registered land surveyor, if required by the Ministry of Interior or the Ministry of Finance.
- Copy of the applicant’s passport.
- Birth Certificate.
- Detailed biography or CV.
- Marriage/Civil Partnership certificate (if applicable).
- Copy of Residence Permit in the Republic of Cyprus.
- Two passport size photographs.
Further documentation might be required depending on which investment method is chosen by the investor (see options in Section B above).
To maintain the citizenship, the investor must always keep in his possession a real estate property with a minimum value of €500,000 (excluding VAT) which will be declared as his ‘permanent residence’ whereas the remaining investment may be sold after the lapse of a three-year period. The investor may still generate income from the ‘permanent residence’ investment by leasing the property if he/she does not wish to physically reside there. The scheme is designed to offer an attractive ‘exit option’ to the investor. The residential property must always be kept as ‘permanent residence’ or, if sold, it must be replaced with an another residential property of equal or greater value.
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