Cyprus CIP Investors Who Began Process Under Old Rules to Be Grandfathered in, Avoiding €150k Donation

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On Monday, Cyprus’ Council of Ministers decided to grant an exemption from the €150,000 donation requirement to those investors who began the CIP investment process prior to the new rules.

Background

On February 13th this year, the same Council amended the regulations of Cyprus’ citizenship by investment program to include a provision requiring – in addition to making the qualifying investment – a donation of altogether €150,000 split equally between the Research and Innovation Foundation and the Cyprus Land Development Corporation.

The problem was that many clients had already begun the process of engaging agents and buying the qualifying assets before the announcement of the new regulations but would not be able to submit the application within the May 15th deadline. Upon receiving this information, presumably from agents and developers who had already collected client fees on the basis of the old rules and who would, therefore, be in an awkward position vis-a-vis their clients, the Council decided to make an exception for such cases.

Investors will now have an additional two months to submit their application under the old rules, as long as they can demonstrate that they finalized the purchase of real estate prior to the May 15th deadline.

The Council’s statement on the matter is reprinted in full below:

Announcement concerning clarification for the Cyprus Investment Programme

In accordance with the decision of the Council of Ministers dated 13.2.2019 investors, who will submit an application on the basis of the Cyprus Investment Programme (Programme) from the 15th of May 2019 and onwards, are obliged to meet the criterion A.1 (Donation to the Research and Innovation Foundation and the Cyprus Land Development Corporation). However, it was brought to our attention that there are investors, who have been informed on the Programme prior to 13th of February 2019, and will not be able to submit their citizenship applications prior to the 15th of May 2019.

Consequently, in order to provide a solution for the aforementioned matter, the Council of Ministers, during its meeting held on the 6th of May 2019, decided that investors, who have concluded agreement/agreements for the purchase of immovable property – either within the framework of criterion Α.2 (Investment in real estate, land development and infrastructure projects) or aiming at the fulfillment of the requirement for the possession of a privately owned residence in Cyprus – will be exempted from the obligatory fulfillment of the aforementioned criterion A.1 (Donation to the Research and Innovation Foundation and the Cyprus Land Development Corporation), provided that the purchase agreement/s will be stamped until the 15th of May 2019 and will bear a seal of the Stamp Duties Commissioner dated until the 15th of May (included).

Finally, it is noted that, according to the decision of the Council of Ministers, the abovementioned exemption will be in force for applications that will be submitted until the 15th of July 2019 (included).

Ministry of Interior
6.5.2019

Image credit: Andreas Komodromos