As the crackdown on attracting buyers of real estate and other investors in exchange for their naturalization as Cypriot-European citizens ended last November (around 1,400 applications are pending), land development entrepreneurs are now turning to making the most of their existing budget. Accommodation, through investments exclusively in the real estate sector.
And in order to maximize the expected benefits of obtaining permanent residence permits for third-country nationals, to compensate for the losses from the termination of naturalization, they call on the state to modify – relax the program, in a way that inevitably comes to mind. in the economic criteria of the robber memory of the Cyprus Investment Program.
SEE ALSO: Large Development Associations and Land Development Entrepreneurs Call for PRP Improvement
In a joint statement yesterday, the Association of Large Developments and the Pancyprian Association of Land Development & Construction Entrepreneurs announced that they had sent a letter to the Ministers of Foreign Affairs and Interior, requesting amendments to the Cyprus Residence Program (PRP) in order to by foreigners who will buy real estate of a certain value. According to the two associations, whose members are included in the entrepreneurs with the greatest benefit from the implementation of the KEP, especially from 2013 until October 2020, their suggestions concern changes that will improve the speed, convenience, accessibility. and the attractiveness of PRP provisions.
It is not known what the response of the two ministers and the government in general will be. Government officials have recently stated that they do not intend to engage in a new investment program at this stage, given that the infringement procedure initiated by the European Commission against Cyprus for the KEP is still ongoing. However, the Permanent Residence Program is already in force, even in the shadow, for years, of the KEP. In the case, however, of the Permanent Residence Program, any relaxations that the government consents to take place should, in contrast to many relaxations that took place in the KEP, also go through Parliament.
The relaxations required
Both bodies suggest that the causes of the delays that, according to them, are observed in the examination and approval of applications be examined. In addition, they suggest the creation of biometric stations for interested investors (applicants for a permanent residence permit in the Republic of Cyprus) in embassies and consulates of the Republic of Cyprus abroad, especially in countries such as China, Vietnam, the UAE, the United Kingdom, Russia. , Jordan and South Africa. These stations, the rapporteurs say, would assist in the electronic submission of applications by interested parties, without the need for the physical presence of the applicant in Cyprus. In addition, the abolition of a condition in the existing program is requested, which requires the visit of the holders of permanent residence permit in Cyprus every two years. In the event that this cannot be applied universally, the letter states, it is proposed that the requirement be retained only for the principal applicants and not for all family members to whom a residence permit has been granted.
The above suggestions are likely to lead to phenomena similar to those we experienced with the KEP, ie foreigners securing a permanent residence permit (which is not renewed, therefore not revoked, unless some very specific conditions are met) without having ever visited Cyprus and without intending to reside in Cyprus. The permanent residence permit is considered to be attractive to third country nationals mainly for tax benefits that can be obtained from the attractive tax regime of Cyprus.
The economic criteria
The Association of Large Developments and the Pancyprian Association of Land Development & Construction Entrepreneurs request that, in the annual income of the applicant, as assessed for the purposes of the income criteria of the program, the annual income of dependent dependent family members be included. ), if an application for a residence permit has been submitted to them. It is understood, the letter states, that the declared annual family income can be verified through the presentation of sufficient supporting documents.
As part of the extensive relaxation for the granting of permanent residence permits, the two associations also suggest the abolition of the program requirement for the commitment of the amount of € 30,000 in a Cypriot bank account in the name of the applicant. They state that in the event that the above requirement cannot be eliminated, the amount provided should be deposited in the applicant's bank account within the European Union or in a special treasury of the State, provided that the amount is repaid immediately after end of the planned period of 3 years.
Elsewhere, the government is urged to speed up the process of Cyprus' accession to the Schengen area, since, as noted, “the fact that Cyprus is outside Shenghen is a substantial and very important disadvantage in relation to competing European countries.”
It is also requested that approved applicants be granted the right to work in Cyprus (they do not currently have it), as well as the possibility of doing business. “Otherwise, the program will continue to be at a disadvantage over competing programs in other European countries, which provide the beneficiaries with the above rights,” it said.
It is also proposed to increase the age limit of dependents from 25 to 28 years, which will offer, the letter notes, additional attractiveness to the program.
The existing criteria and options for a permanent residence permit
The Permanent Residence Program through investments, for foreigners from third countries who do not reside in Cyprus or reside for a period of less than five years, provides for an Accelerated Procedure (Regulation 6 [2]), which under certain conditions can be completed in a few months.
It is required to buy a new house (first sale) in Cyprus, worth at least € 300,000, plus VAT. An amount of at least € 200,000 must be paid when buying the home. A deposit of at least € 30,000 (from abroad) is also required to be deposited in the account of a financial institution of Cyprus, which will be frozen for a period of at least three years. The applicant must also prove that he or she has an annual income of at least € 30,000, coming from abroad (plus € 5,000 for each dependent family member included in the application and € 8,000 for each dependent parent of the applicant and / or of the spouse). The applicant does not have the right to work in Cyprus, so it is important for the applicant to prove that he has the income (from abroad) to ensure the residence of himself and his dependents in Cyprus. A white criminal record is also required. There is also the possibility of a second option (Category F), which is more time consuming but provides for the purchase of a property of lower value. Specifically, the purchase or rental of a house or apartment in Cyprus is required, with no limit on value / cost. An annual income of the applicant is required, amounting to at least € 10,000, coming from legal sources outside Cyprus (plus € 5,000 for each dependent). This aspect of the program does not allow work in Cyprus either, something that, as mentioned above, the two associations are calling for to be abolished. A white criminal record is required.
