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3,127 Ireland IIP Applications Worth €2.12 Billion Pending After Torrent of Last-Minute Filings

3,127 applications worth some EUR 2.12 billion in investments still await processing under the Irish Immigrant Investor Program (IIP), suspended since February 15th this year.

Secretary General of the Department of Justice, Oonagh McPhillips, cited a rush in applications before the program’s closure during a debate with the Committee of Public Accounts on the 25th of May.

McPhillips revealed that the government received 1,316 applications in 2022, nearly three times as many as the 443 applications logged in 2019 (the previous record year) and five times as many as the preceding year.

McPhillips also revealed that in addition to the deluge of applications it received in the second half of 2022, the government had received 1,350 applications in 2023 alone, to which Deputy Marc Ó Cathasaigh replied with a simple “wow.” In the last six months or so, the program saw more applications than during all previous years combined.

Caught off-guard by the entirely unprecedented influx of files, the Irish government now has a backlog equivalent to two-thirds of all applications received in the program's history. Put another way, the number of pending files is almost double that of approved ones.

Based on historical per-approval average investment amounts, the 3,127 pending files, if all ultimately approved, would garner some EUR 2.12 billion for Ireland.

McPhillips highlighted the consistency of applicant origins, pointing out that 94% of all approved applicants were still of Chinese origin.

The IIP's official closure came at 5.15 p.m. on the 15th of February, 2023, and quizzed on how many of the 1,350 applications came in before the deadline, McPhillips couldn't give a clear answer as she explained that the "sheer volume of applications on hand means we have done a global, provisional overview of what is on the stocks but still have to go into the detail of the applications," highlighting that "it will take a number of months before we get a clear picture of the detail of the applications."

When Deputy Catherine Murphy asked how many of the pending applications were from Russians, McPhillips quickly noted that there were none and that "over the lifetime of the program, we have had very few Russian applications. There is nobody currently in benefit from Russia." She also stressed that the program had maintained a ban on Russians for the past several months.

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More complex sanctions environment informed decision to close program

When the government abruptly terminated the program in February, it provided scant explanations for its rationale, merely hinting that concerns about high application numbers, Chinese dominance, and EU disliking of the program had all played a role in the decision. This week, however, the Committee of Public Accounts further queried the government on what led to its decision.

McPhillips indicated the sharp rise in application volume was one of the primary reasons behind the government's decision, stating that "the volume became really quite unmanageable in 2022" and that it would take the government "quite a long time to work through the volume of what came in during 2022 and the volume of what has come in since."

She also pointed to an overall public policy concern about the risk environment and the program's vulnerabilities, citing the shift in the "overall global risk environment" due to the ongoing conflict in Ukraine. Finally, she justified the closure by highlighting that the UK had made a similar decision the year before, where Russians, rather than Chinese as in Ireland, had been a salient participant group.

McPhillips refuted claims that the European Commission, OECD, or the Council of Europe were the main instigators behind the IIP's closure, stating that "none of the external international bodies expressed specific concern about our scheme."

She acknowledged, however, that the EU had "expressed concern about these types of programs in general, and their overall effect," but revealed that they did not directly issue an order or coercive recommendations to close the program.

Acting Deputy Secretary for the Civil Justice Pillar, Mr Doncha O'Sullivan, acknowledged that golden visa programs labored under perceived "risks of money laundering, the evasion of sanctions, terrorist financing, the inappropriate use of funds and tax evasion," but said the Irish IIP had a "wide range of measures in place to prevent this being the case."

He admitted, however, that the sudden wave of applications had put the program's processing abilities to the test, particularly in light of the increasing employment of sanctions against citizens of more countries.

"As the number of applications grows," he commented, "the extent to which we have to scale up our capacity to prevent this from happening also grows. This is in the context of a very disrupted international environment, with more sanctions in play internationally and growing concern about this."

If you like data-driven articles like this one, you'll love the IMI Data Center, the world's largest collection of investment migration statistics, with more than 350 graphs and charts on dozens of IM programs and markets.