Citizenship by investment programs (CBI)
“Golden passports,” (CBI) allow wealthy foreigners to receive citizenship or residency in exchange for investing a certain amount of money in a country
Investor citizenship schemes allow a person to acquire a nationality on the basis of payments or investments. Investor residence schemes allow third-country nationals to obtain a residence permit in return for payments or investments in order to live in an EU country.
In 2019, the Commission published a report on investor citizenship and residence schemes applied by a number of EU Member States, identifying existing practices and certain risks such as security, money laundering, tax evasion and corruption.
Three Member States (Bulgaria, Cyprus and Malta) currently offer schemes granting nationality on the basis of a financial investment (citizenship by investment or CBI schemes – or ‘golden passports’); and 12 Member States (Cyprus, Estonia, Greece, Spain, Hungary, Ireland, Italy, Latvia, Luxembourg, Malta, the Netherlands and Portugal) offer schemes granting residence permits on the basis of investments (residence by investment or RBI schemes – or ‘golden visas’). An EPRS study estimated that, between 2011 and 2019, over 132 000 people secured residence or citizenship in EU Member States via CBI or RBI schemes. Over the same period, the total investment inflow from these schemes was estimated to be at least €21.4 billion.
EU response to Russia’s invasion of Ukraine
In the light of the Russian invasion of Ukraine, the European Commission has again called on Member States to immediately lift all existing investor citizenship regulations. “The right to move freely in the Schengen area is one of our most valuable assets. We need strict controls so that this right is not abused. Russians and Belarusians subject to EU sanctions should be deprived of golden visas,” said Ylva Johansson, EU Commissioner for the Interior. “More than ever, in the face of the war, we must prevent sanctioned Russians and Belarusians and supporters of Putin’s war of aggression from simply buying their way into the EU.”
Justice Commissioner Didier Reynders said: “Our European values are not for sale. We believe that the sale of citizenship through so-called golden passports is illegal under EU law and seriously jeopardises our security. It opens the door to corruption, money laundering and tax avoidance. All Member States concerned should immediately abolish their investor citizenship schemes. In addition, they should consider withdrawing gold passports that have already been granted to those who have been sanctioned or who strongly support Putin’s war.”
Investor citizenship schemes
At the same time, those who hold the citizenship of an EU Member State are also citizens of the Union. EU citizenship automatically goes hand in hand with the right to free movement, the right of access to the EU internal market and the right to vote and stand as a candidate in European and local elections in all Member States. Russian aggression against Ukraine has once again highlighted the risks associated with such citizenship schemes.
Investor residence schemes
Investor residence schemes pose risks to Member States, as well as to the EU as a whole, in terms of security, money laundering, tax evasion and corruption. Russia’s aggression against Ukraine has again made this clear.
Recommendation for Member States
The Commission has repeatedly expressed its serious concerns about such citizenship and residence schemes for investors and the associated risks. The commission has also make a recommendation to take decisive action on these arrangements. In the current context of Russian aggression against Ukraine, these risks are once again particularly evident.
The Commission recommends that Member States consider whether Russian and Belarusian nationals who are on an EU sanctions list in the context of the war in Ukraine should be deprived of “golden passport” citizenship Similarly, following a case-by-case assessment and in accordance with the principles of proportionality, fundamental rights and the national law of the Member States, sanctioned Russian and Belarusian nationals should be deprived of residence permits issued on the basis of investor residence schemes without delay. This measure should also concern Russian and Belarusian nationals who are instrumental in supporting the war in Ukraine.
The recommendation presented today does not affect the admission and residence of Russian and Belarusian nationals in the EU for other reasons, including humanitarian admission or international protection.
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