Portuguese Parliament Okays Housing Bill in Final Vote: Q&A On What Happens Next for Golden Visa Investors

Inês Costa Moura
Porto

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Today, the Portuguese Parliament voted [ed.: “na especialidade”] to approve the housing package aimed at facilitating access to the acquisition and leasing of residential properties for Portuguese residents, including a restructuring of the Portuguese ARI or Golden Visa (“GV”) program.

I have prepared a Q&A series to provide a comprehensive view of

• the amendments approved by the Parliament and the potential new regime;
• the approval process that ensues; and
• the impact of these amendments – if approved in the Portuguese Golden Visa Program.

What changes to the Portuguese Golden Visa program were approved by Parliament today?

The first relevant piece of information was that the Portuguese Golden Visa program was not terminated, as several outlets had been announcing over the past months. Instead, the new legislation restructures the program to limit the scope of specific investment categories, namely the real estate-related ones.

Under the current bill proposal, the program will remain in place and investment will be possible under the following investment categories:

1. Transfer of capital equal or superior to EUR 500,000, applied to research activities by public or private scientific research institutions, integrated into the national scientific and technological system;
2. Transfer of capital equal or superior to EUR 250,000, applied to investment or support for artistic production, recovery, or maintenance of national cultural heritage through central and peripheral direct administration services, public institutes, entities that integrate the public business sector, public foundations, private foundations with public utility status, inter-municipal entities, entities that integrate the local business sector, municipal associative entities and public cultural associations, which pursue attributions in the area of artistic production, recovery or maintenance of national cultural heritage;
3. Transfer of capital equal or superior to EUR 500,000, intended for the acquisition of shares in specific collective investment organisms, which include certain types of funds, which are incorporated under Portuguese law, whose maturity, at the time of investment, is at least five years and at least 60% of the value of the investments made in commercial companies based in the national territory;
4. Transfer of capital in an amount equal or superior to EUR 500,000, intended for the incorporation of a commercial company with a registered office in the national territory, combined with the creation of five permanent jobs, or for the reinforcement of the share capital of a commercial company with registered office in the national territory, already incorporated, with the creation of at least five permanent jobs or the maintenance of at least ten jobs, with a minimum of five permanent jobs, and for a minimum period of three years.

Will these changes impact applications submitted under the current regime?

Not at all. The prosed bill made it clear that

• all applications submitted before the new law takes effect will be fully processed, and renewal rights will be fully assured;
• the analysis of all files submitted up until the entering into force of any amendments will follow all existing rules and regulations;
• no changes will be implemented to the law regarding the adding of family members, which means that family reunification will still be possible after the changes are implemented;
• no changes regarding access to citizenship and permanent residency were included.

Therefore, all applications submitted, at least until the proposed law takes effect – presuming the President promulgates the law as-is – will be subject to the rules in place at the moment of submission, meaning the current regime. 

What are the next steps following the approval in Parliament?

Following the approval in Parliament, the next step to send the proposed bill to the President of the Republic.

There is no way to determine how the President of the Republic will respond to the legislation, but one of three scenarios will take place:

1. Direct ratification: In this case, the proposal takes effect on the date outlined in the proposal – the day after publication in the official journal (Diário da Républica).
2. The President of the Republic does not accept the proposal as it is and sends it back to the Parliament for revision; or
3. The President of the Republic does not issue an opinion on the document but requests its evaluation by the Constitutional Court.

What is the expected timeline for the next steps?

Even if option 1 (direct ratification) takes place, the law comes into force by the middle/end of September at the earliest. Our assumption is based on the package’s complexity, which will require extensive analysis, and the current holiday period, which will add time to the process. This is, in any case, a conservative approach to this subject. The President has recently taken more than three months to promulgate several pieces of less complex legislation.

Should option 2 or 3 apply, the timing will be extended exponentially.

Is it possible to continue to invest in the Portuguese Program under the current regime?

It is both possible and advisable.

First, practically all opposition parties challenged the current bill. It is very far from consensual, and there is no telling exactly how, when, or even if the President of the Republic will publish it.

Moreover, even if the proposed law is published as-is or in a similar version, given the expected and conservative timeline, prospective investors are advised to move forward as soon as possible with their investments. The current timelines will allow investors to start and submit their process before the potential end of the Golden Visa program.

In conclusion, under the proposed law, the Portuguese Golden Visa program will remain in force, but we are looking at an increase in the entry point of all remaining categories across the board. Therefore, in order to keep both the existing regime and the current price point, anyone planning to invest in the Portugal golden visa should move forward without delay.

IMI Pros who can help with the Portugal Golden Visa