Having been the subject of criticism from European political bodies for years despite extensive mitigating measures, the Cypriot government is putting in place new regulations it says will leave it well-nigh unimpeachable.
The government of Cyprus yesterday approved a new set of regulations for its citizenship by investment program which – among other changes – includes (so far unspecified) provisions tying the program to anti-money laundering legislation. Interior Minister Nikos Nouris indicated the administration would now urgently table the new regulations in Parliament for final approval, according to Kathimerini.
Over the last two years, as a direct response to concerns voiced in the European Parliament and Commission, Cyprus has enacted a series of program reforms aimed at mollifying such apprehensions. The steps have included – but have been far from limited to – appointing official due diligence providers, introducing an application cap, retroactive candidate vetting, and residence requirements. Nonetheless, European political institutions have persisted in their calls for a “phasing out” of the program over ostensible concerns of money laundering risks.
Whereas during the 2016-2019 period, both Malta and Cyprus responded to such calls in good faith by demonstrating transparency and willingness to implement palliative reforms, a notable change in attitude has become apparent this year as the two EU CIPs’ authorities observed that their efforts to improve according to European requests went largely unacknowledged and that the goalposts appeared to have moved.
Following the economic impact of the pandemic, both Mediterranean governments, essentially, indicated that they had done what the Commission had asked of them, that this had made little difference to the latter’s stance, and that, ultimately, the programs were a matter of national – and not EU – competence.
Impeccability is the only defense
With new regulations now pending parliamentary approval, the Interior Minister made clear, Cyprus hopes to take the teeth out of EU criticism once and for all. Combined with the amendments introduced last year, which significantly strengthened the program’s integrity, Nouris noted, the CIP could “no longer be ridiculed, as has been done until recently but, even more important, there can no longer be any doubts regarding the program’s reliability.”
That line of reasoning, of course, assumes that the cited concerns regarding program integrity were not, to begin with, merely ostensible.
“What we have done as a member state is to inform the EU and, in fact, we have exhaustively presented the provisions and criteria of our program because we have nothing to hide, but much more we also want to refute rumors spread by some at various times that the Republic of Cyprus abused this program,” lamented Nouri. “There has been no such thing. I believe that, after the regulations are studied by Parliament, there will be absolute consensus that the strictness of the regulations no longer allows such comments.”
While the financial terms of the program will remain unchanged and the annual cap on applications will remain, Nouris pointed out that the government had widened the scope of investment activity that would qualify investors for citizenship.
“We have provided the option for alternative ways of investing for those who will join the program, such as through participation in businesses or participation in Cypriot companies through the purchase of shares.”
Without offering much in the way of particulars, the Minister related that the new regulations will also aim to tackle the question of citizenship revocations relating to those applicants who are found – post hoc – to have engaged in behavior that would have disqualified them from applying at the outset.
“Also characteristic of the new program is that rules will get stricter, so that the revocation of the granting of citizenship is made in a clear way, as in the case where it becomes clear that a candidate for citizenship was either involved or convicted in a serious crime,” said Nouris, in a nod to Cypriot efforts to revoke the citizenships of 26 individuals, which have so far been stymied by legal technicalities.
Want to know more about the Cyprus Citizenship by Investment Program? To see recent articles, statistics, official links, and more, visit its Program Page. To see which firms can assist with applications to the program, visit the Residence & Citzenship by Investment Company Directory.
Properties that can qualify the buyer for citizenship/residence in Cyprus:
See more properties that come with residence/citizenship opportunities in IMI Real Estate.
Christian Henrik Nesheim is the founder and editor of Investment Migration Insider, the #1 magazine – online or offline – for residency and citizenship by investment. He is an internationally recognized expert, speaker, documentary producer, and writer on the subject of investment migration, whose work is cited in the Economist, Bloomberg, Fortune, Forbes, Newsweek, and Business Insider. Norwegian by birth, Christian has spent the last 14 years in the United States, China, and Spain.