CMCY | Amendments to the scheme for Naturalization of Investors in the Republic of Cyprus
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Amendments to the scheme for Naturalization of Investors in the Republic of Cyprus

Amendments to the scheme for Naturalization of Investors in the Republic of Cyprus

The Council of Ministers has published and issued a decision in which all applications for Naturalization by Investment will need to meet certain new criteria and conditions as from the 15th of May 2019.

As with the previous scheme, the successful applicants and their family can hold a Cypriot passport and enjoy all the benefits of a Cypriot National, by making all necessary investments and complying with specific economic criteria and new additional terms and conditions.

According to the new amended criteria there are two mandatory donations have been imposed to the applicant which are briefly stated below marked as A1. Another amendment to the terms and conditions  is that the Cypriot Government has imposed the necessity for an applicant to hold a Schengen Visa and to provide a written declaration signed at the Cyprus District Courts or at any Cypriot Consular Office or Embassy abroad stating that he/she has not been rejected to any Citizenship program in any country of the European Union.

Further to the above, as from the 15th of May 2019 the investment made by the applicant/investor in the Republic of Cyprus must be retained for a period of at least five years as from the date of his Naturalization.

So, as of the 15thof May 2019, applicants who meet any of the below criteria and fulfil the terms and conditions outlined by the Government of the Republic of Cyprus may apply for the acquisition of Cypriot citizenship through naturalisation by exception. More specifically, applicants must satisfy the criterion listed below as A.1 and also meet one of the criteria under A.2 to A.5.

Below are briefly the new economic criteria and conditions as amended and published by the Council of Ministers.

Criteria/ Investment options:

A1. Donations

  1. a) A mandatory donation of €75,000 to be given to the Foundation for Research and Innovation to promote the creation of an entrepreneurial innovation ecosystem.
  2. b) A mandatory donation of €75,000 to the Cyprus Land Development Corporation, contributing to the new integrated housing policy program, specifically the implementation of affordable housing projects and other housing plans/ measures.

It is noted that should the applicant wish to make a donation greater than €75,000, the additional amount, shall be calculated towards his/ her investment amount under criteria A2 – A5.

A2. Investment in real estate, land development and infrastructure projects

The applicant must invest at least €2 million for the purchase of properties, or for the purchase or construction of buildings, or for the construction of other land development or infrastructure projects.

A3. Purchase, establishment or participation in Cypriot companies or businesses

The applicant must have invested or participated in companies/ organisations established and operating in the Republic of Cyprus with investment costs of at least €2 million.

Applications shall be evaluated to verify that the companies / organisations have physical presence in the Republic, with significant activity and turnover and employ a minimum number of 5 Cypriot or EU citizens. This number shall be subject to increase, if more than one applicant invests at the same time or almost at the same time in this particular company/ organisation.

A4. Investment in Alternative Investment Funds or financial assets of Cypriot companies or organisations that are licensed by CySec

The applicant must have bought units of at least €2 million from alternative investment funds (AIF) established in Cyprus, licensed and supervised by the Cyprus Securities and Exchange Commission and whose investments are made exclusively in Cyprus, in investments that meet the criteria of this Programme or in areas approved by the Minister of Finance.

For confirmation that the investments meet the criteria, that is to be retained for at least 5 years, the manager/ auditor of the fund shall annually inform in writing, the Ministry of Finance and the Ministry of the Interior with reference to the value of the initial investment.

A5. Combination of the aforementioned investments

If the applicant wishes to combine the above mentioned investments he may proceed, on condition that the total investment amounts to at least €2 million.

Additional terms and conditions

The applicant must also fulfill the below conditions:

  • Have a clean criminal record
  • Obtain a Valid Schengen visa
  • Retain investments for at least 5 years from the date of naturalization
  • Possess a permanent privately-owned residence in Cyprus, the purchase price of which must be at least €500,000 (excluding VAT)
  • Hold a Residence permit in the Republic of Cyprus of at least six months.

Documents for submission in the naturalisation by investment application:

  • Applicant’s clean criminal record from the country of origin as well as the country of residence (if different)
  • Copy of the applicant’s Schengen visa
  • Due Diligence Report issued by an internationally accepted database ensured through a subscription (e.g world check, lexis nexis)
  • Applicant’s declaration regarding the investment by naturalisation scheme
  • Proof of investment (e.g the sale contract, receipt of depositing the sale contract at the Land Registry, swift payment/ confirmation, receipt of the agreed purchase price)
  • Proof of permanent residence in the Republic of Cyprus of at least €500,000 (plus VAT). Under the new criteria, other documents including the urban planning permission, bank waiver and certificate of completion signed by the project architect will need to be submitted. With regard to the certificate of completion, in the case of ongoing construction projects, it is required to maintain an amount equal to 5% of the value in a different account or the equivalent bank guarantee from the seller to the buyer of the property (Performance Bank Guarantee).

Any additional documents requested by the Ministry of Finance or by the Ministry of Interior.

For more information on how to apply for Naturalisation by Investment in Cyprus, you may contact us at info@cmcylaw.com or +35725255059

Note: The above article does not constitute a legal advice and may not be relied upon for such purposes. Readers are recommended to take appropriate legal advice on the above subject matter.