Saint Lucia CIU Circular Says Promotion of CBI Real Estate Discounts Violate License Terms

---

In a circular issued this Thursday, the Saint Lucia Citizenship by Investment Unit warns the program’s licensed marketing agents and promoters that marketing the Saint Lucia CIP‘s real estate investment option at amounts lower than the required minimum constitutes a violation of their licenses.

The CIU began its circular by reminding stakeholders that the statutory minimum investment in a CBI-qualifying real estate development has been US$200,000 since the beginning of this year, an amount that was fixed and not subject to any exceptions:

Citizenship can only be granted upon the applicant making the full, legislated minimum investment into the developer’s approved escrow account after meeting the necessary due diligence review. In every instance, that sum must be paid by each successful applicant into the approved escrow account. 

Although it did not mention any promoters by name, the circular indicated the CIU was aware that some promoters were offering discounts on real estate investments through financing models:

The Unit has noticed a general practice whereby third parties are advertising qualifying investments that are less than the legislated amounts. This is incorrect and the Unit wishes to remind that it is a violation of the licenses granted to Marketing Agents and Promoters to advertise, promote, market, or in any ay present a qualifying investment for the Citizenship by Investment Programme that is less than the legislated amount.

The CIU also said it would announce changes in the next few weeks that would “strengthen the integrity and security” of the Saint Lucia CIP.

Caribbean CBI country authorities have instated a number of policy changes in recent months to tackle the seemingly intractable issue of inappropriate and, strictly speaking, illegal discounting and financing practices employed by many (otherwise reputable) investment migration companies:

• In December, the Saint Kitts & Nevis CIU caused a stir when the new government implemented CBI real estate policy changes that threatened to make the business model altogether unviable by, for example, prohibiting developers from paying agent commissions out of the US$200,000 raised from qualifying investments, an issue we covered in detail in our Q4 2022 Private Briefing.

• Following feedback from program stakeholders, the new government in Basseterre later changed its mind on several of those reforms but maintained that developers should not pay commissions out of the qualifying investment amount.

• Just last month, the Grenada CIU issued a stern admonishment to promoters and agents marketing discounted real estate, warning that applicants found to have purchased real estate for anything less than the statutory amounts ran the risk of seeing their citizenships revoked.

The wording of Saint Lucia’s circular this week, by comparison, appeared to be more of a friendly reminder than a threat of tangible consequences for transgressors.

IMI Pros who can help with the Saint Lucia CIP: