Permanent Residence Permits by Investment
The Department of Population and Migration has proceeded with a revision and subsequent improvement of the criteria for granting an immigration permit to applicants who are third country (Non-EU) nationals and who invest in Cyprus.
The most basic differentiation that occurred through the third revision, is that now investors will be able to obtain a permanent residence permit by investing in real estate in Cyprus with a minimum total value of at least €300,000. Until the last amendments, investing in real estate such as offices, shops, hotels or similar developments had to occur as a new sale, not a resale.
It is worth noting that with regard to residences, eligibility is extended to resales, provided, however, that these resales were made before 7 May 2013 and that the sale purchase documents were deposited at the land registry before that date.
1. LEGAL FRAMEWORK
1.1 In accordance with the provisions of Regulation 6(2) of the Foreign and Immigration Regulations, the Minister of Interior decided to issue immigration permits to third-country nationals, in cases of investments that meet the requirements outlined below.
1.2 The applicant must meet one of the investment criteria set out in paragraph 2.1, as well as the qualitative criteria set out in paragraph 3 below. It is noted that the funds to be used for the investment have to come from abroad.
2. INVESTMENT CRITERIA
2.1 The applicant must make an investment of at least €300,000 in one of the following investment categories:
(A) Investment in a house/apartment: purchase of a house or apartment from a land development company, which should be for a first sale of at least €300,000 (+ VAT).
(B) Investment in real estate (excluding houses/apartments): purchase of another form of real estate such as offices, shops, hotels or similar developments or a combination of them with a total value of €300,000. Such an investment may involve a resale property.
(C) Investment in the equity capital of a Cyprus registered company with activities and staff in Cyprus: The investment must have a value of at least €300,000 in the equity capital of the company, which is both based and active in the Republic of Cyprus and has a proven physical presence in Cyprus and employs at least five (5) people.
(D) Investment in units of a Cyprus Collective Investment Enterprise (either AIF / AIFLNP / RAIF). It is understood that any alienation of the holder of the immigration permit from the investment in which he/she has made without its immediate replacement with another of the same or greater value, which should meet the conditions set out above, will result in activation of the process of cancellation of the permit under the provisions of Regulation 6 of the Immigration Regulations.
2.2 The applicant must, in addition to the investment under paragraph 2.1 above, be able to prove that he/she has at his/her disposal an insured annual income of at least €30,000. The annual income increases by €5,000 for each dependent family member respectively and €8,000 for each dependent parent (of the applicant and/or his/her spouse). This income may emanate from salaries, pensions, dividends from shares, bank deposits, rents, etc. coming from abroad in cases where the applicant chooses to invest as per paragraph 2.1.(A) above. The calculation of the total income may include that of the spouse.
In instances where the applicant chooses to invest as per paragraphs 2.1.(B), 2.1.(C) or 2.1.(D) above the applicant’s total income or part of it may also be derived from sources or activities within the Republic of Cyprus.
3. QUALITY CRITERIA
3.1 The applicant and the spouse must submit a clean criminal record certificate from their country of residence or from the Republic in case they reside in Cyprus.
3.2 The applicant and the spouse shall certify that they do not intend to be employed in the Republic except as directors of a company in which they have chosen to invest under this policy.
3.3 In cases where the investment does not relate to the share capital of a company, the applicant and/or the spouse may be shareholders in companies registered in Cyprus and the income from dividends in such companies may not be considered as an impediment for the purposes of obtaining the immigration permit. They may also hold the position of director in such companies without pay. 3.4 In cases where the applicant chooses to invest as per paragraphs 2.1.(B), 2.1.(C) or 2.1.(D), he/she should present data on his/her place of residence in the Republic by way of producing, for example, a title deed of property, a sale purchase agreement or rental agreement).
4. LEGAL PARTICULARS
4.1 Investment in a house/apartment or other property: The applicant must submit together with his/her application a title deed or purchase document in the applicant’s name or that of the applicant’s spouse filed at the Land Registry for a residence or other building with a market value of at least €300.000 (plus VAT if applicable) and official receipts for payment of at least €200,000 (non-inclusive of VAT), regardless of the date of delivery of the property.
It is understood that at the time of submission of the application, evidence should be provided that the investment money has come from abroad and is not the product of internal lending, as such, remittances / proof of payment with a foreign card / bank certificate linked to the relevant investments should be furnished. The balance of the value of the investment should be paid into the seller’s account at a financial institution in Cyprus.
It is noted that the purchase of property will be accepted even when it is made by a legal entity in which the applicant and/or the spouse are the sole shareholders or final beneficiaries and which is legally established in the Republic or in another Member State of the European Union or the European Economic Area.
For the purposes of applying Paragraph 2 in relation to the purchase of a house/apartment it is specified that:
(a) The applicant may purchase up to two (2) units of residence (apartments or houses), provided that the total market value meets the provisions of paragraph 4.1 above. In the case of a couple, the above condition applies to the couple as a whole.
(b) This purchase must relate to houses sold by a development company to a buyer for the first time, unless the purchase of the houses took place before 07.05.2013. Purchase and sale documents relating to resales of houses that are deposited at the Land Registry before 07.05.2013 (the deposit date of the purchase and sale documents shall be confirmed by the Land Registry), will be accepted for the purposes of implementing this policy.
It is noted that the real estate does not necessarily need to be purchased from the same land development company.
4.2 Investment in equity capital of a Cyprus company with business activities and staff in Cyprus:
For the purposes of implementing this policy, the applicant is required to make a total investment of €300.000; the company must have physical presence in the Republic and must employ at least five (5) employees. In this case, the following documents will have to be presented:
• A Share purchase agreement;
• Certificate of Incorporation and Certificate of shareholders issued by the Registrar of Companies; • A Business profile and plan of the company that includes its business objectives etc;
• Proof of payment of the share capital;
• Evidence of employment of employees from the Department of Social Insurance.
4.3 Investment in units of Cyprus Collective Investment Funds (type AIF, AIFLNP, RAIF):
For the purposes of implementing this policy, the applicant is required to make a total investment of €300.000 in investment units and to present the following documents:
• Securities or other confirmation for purchased units;
• Proof of payment of the same;
• Confirmation by the Securities and Exchange Commission on the establishment of the fund;
• Memorandum of the fund or investment project.
5. DEPENDENT PERSONS
5.1 The immigration permit is issued to the applicant. This includes the dependents of the applicant who are the spouse and their minor children up to the age of 18 years.
If they so wish, it is possible to issue two separate immigration permits to each spouse respectively without the obligation that the second spouse meets the above criteria, provided that a separate application is submitted and the corresponding fee is paid.
It is understood that in the event that the immigration permit granted to the investor is cancelled for any reason, it will entail activation of the process of cancellation of the permit for the spouse, based on the provisions of Regulation 6 of the Aliens and Immigration Regulations.
5.2 Unmarried children of the applicant aged 18 to 25, will be granted permits only if it is proven that they are students in higher education institutions abroad at the date of application and that they are financially dependent on the applicant. Such dependent children may submit their own, separate application for obtaining an immigration permit with the submission of the corresponding fee. In such cases the father or mother and/or both parents together should present an additional annual income of €5,000 for each such dependent child.
If such dependent children are students in higher educational institutions of the Republic they should apply for a temporary residence permit in the Republic as students under the relevant legislation (EU directive). Upon completion of their studies in Cyprus they will be able to submit their own application for an immigration permit, as mentioned above with the payment of the appropriate fee, regardless of their age with the only condition that the parents will present an additional annual income of €5.000.
This permit will continue to be valid beyond the age of 25 even if the dependent child is not still unmarried and/or a student and/or financially dependent on the parents. It is provided that the spouse and any minor children may not be included as dependents on this permit. It is also provided that in the event that the immigration permit granted to the investor / parent is cancelled for any reason, it will result in activation of the process of cancellation of the permit for that child, based on the provisions of Regulation 6 of the Aliens and Immigration Regulations.
5.3 An immigration permit can also be granted to the applicant’s parents, by submitting separate applications for each person and paying the corresponding fee, on the sole condition that the applicant will present an additional annual income of €8,000 for each dependent parent. It is also understood that in the event that the immigration permit granted to the investor is cancelled for any reason, it will result in the activation of the process of cancellation of the permit for these parents, based on the provisions of Regulation 6 of the Aliens and Immigration Regulations.
6. HIGHER VALUE INVESTMENT FOR ADULT CHILDREN
An immigration permit may also be granted to adult children of an applicant who do not fall in the aforementioned category and who are not financially dependent provided that a higher value investment is made, on the basis of the provisions of paragraph 2, as specified below:
The market value of the investment of €300.000 should be multiplied by the number of adult children, who will rely on the same investment for the purpose of obtaining an immigration permit. For example, if the applicant has an adult child the applicant must make an investment of at least €600.000, if the applicant has two adult children the value of the investment should be at least €900.000.
Where the investment will be in the real estate market, i.e. where the applicant chooses to invest as paragraphs 2.1.(A) and 2.1.(B), together with the application, a certificate of payment of at least 66% of the market value of the real estate must be submitted.
Provided that, in such a case, each adult child will be able to prove that he/she has at his/her disposal an insured annual income of at least €30,000, which will be increased by €5,000 for each dependent person, as per the provisions of paragraph 2.2. In addition, it is noted that the investment can be submitted jointly in the name of the applicant and the adult child or exclusively in the name of the parent.
7. APPLICATION SUBMISSION AND EXAMINATION PROCEDURE
The applications, together with the required accompanying documents, will be submitted to the Department Migration personally or through a representative. Upon submission of the application a fee of €500 is paid.
In the case of submission of an application through a representative, this should be accompanied by a written authorisation of the applicant stating the full details of the representative.
The application is processed by the Department of Migration and thereafter submitted to the Minister of Interior, through the Director General of the Ministry of Interior.
8. TIMEFRAMES
If all the criteria of this policy are met and if there are no reasons related either to the criminal record of the applicant, or to reasons of Public Order and Public Security, the application will be forwarded for examination and a final decision will be taken by the Minister of Interior.
It is estimated that the period of examination of the application from the date of submission of the completed application will be approximately two (2) months.
9. OTHER INFORMATION
Persons who are granted an immigration permit must take up their permanent residency in the Republic within one (1) year from the date of approval of the submitted application, while they must, like their family members, not stay outside the Republic for a period exceeding two (2) years. Otherwise, the immigration permit shall cease to be valid under Regulation 6(3) and / or may be cancelled under Regulation 6(4).
The Firm assists its clients throughout the entire process of obtaining a residency permit, including, inter alia, locating real estate, conducting due diligence on the title, preparation of sale purchase and other agreements, company formation, corporate support and managing the application process. For more information contact us on:
