Changes to Malta Residence and Visa Programme boosts accessibility for foreign investors

Several amendments to Malta’s Residence and Visa Programme (MRVP) recently came into effect through the announcement of Legal Notice 189. This is the first update to the regulations of the visa programme that was first introduced in 2015.

The three main changes to the MRVP that are already in effect are as follows:

Adults of any age that are unmarried and financially dependent on the main applicant are now eligible to be considered a dependant of the main applicant for residency purposes.

Previously, only children up to the age of 26 could benefit from residency as a dependant. Even if they were 26 or younger at the time of application, the residency rights of dependant children were revoked once they turned 27. Now, there is no age limit for adult dependants. The main applicant can even choose to include any future spouse and/or children of an adult dependant on their visa, for a €5,000 fee per person.

There is no longer any obligatory requirement for the main applicant and any dependants to reside outside Malta for a continuous six months, or for 10 non-consecutive months within a five-year period.

The MRVP originally stated that anybody who is considered a long-term resident of Malta cannot receive the benefits of the programme. A foreign national who has resided in Malta for a continuous period of five years is considered a long-term resident. The only way to avoid this is to either reside outside Malta for at least six months in a row, or ten months in total within this five-year period. With the recent visa changes, applicants and their dependants are no longer required to leave Malta for any amount of time.

The parents and grandparents of either the main applicant or his/her spouse are now eligible to be included in the visa application.

For a non-refundable fee of €5,000 per person payable at the time of application, parents and grandparents can join the main applicant and/or his or her spouse in Malta as dependants.

Though these are minor amendments and do not alter the way the programme fundamentally works, it is hoped that a greater number of foreign investors will be attracted to Malta. Allowing more of the main applicants’ family members to reside in Malta makes the programme much more accessible.

However, under this programme there is still no option for investors and their family members to eventually become citizens of Malta, and dependants are not permitted to work with this visa. Other golden visa or citizenship by investment programmes are more appropriate for this purpose.

Despite this, the Malta Residence and Visa Programme remains one of the best and most popular residency programmes in Europe. With a five-year investment in government bonds worth €250,000, a property lease worth €12,000 per year and a one-time contribution of €30,000, investors and their families can reside indefinitely in Malta and travel visa-free within the Schengen area.

Golden Visas/Citizenship by Investment Programmes

Many countries offer residence and citizenship via investment, whereby an investor invests funds into specified fields and they thus acquire immigration status in that country. Such schemes are often referred to as “golden visas”. Countries that offer schemes like this do so because they want to encourage inward investment and economic stimulation.

One of the most popular of these schemes is the Portuguese “Golden Visa” programme. This is a scheme which offers to successful applicants both a Portuguese residency visa and a Schengen visa.

The Portuguese residency visa is issued for an initial period of one year and after that it is extendable in two-year periods. It permits the visa holder and their family members to live in Portugal for the relevant visa period without any further immigration permission. After five years the visa holders – assuming that the investment has been maintained – may be able to apply for permanent residence in Portugal (ie the right to live there indefinitely) and after one further year they may be able to apply for Portuguese citizenship.

The residency visa entitles the holder to stay in Portugal for an unlimited maximum number of days per year – they can stay there for 100 per cent of the time if they wish. And there are only very small limits on the minimum time they must spend in Portugal: at least seven days per year during the first year and at least 14 days per two-year period subsequently (ie an average of seven days per year over two years).

The Schengen visa entitles the visa holder to travel throughout the Schengen area, which includes most countries in Western Europe and some in Eastern Europe.

So the Portuguese Golden Visa holder is able to live in Portugal without restriction and is also able to travel easily throughout much of Europe.

There are various different options for the investment for the Golden Visa: the investment can be in funds, in property or in job creation. If the investment is in funds the required amount of investment is between 250,000 Euros and 1,000,000 Euros, depending on the type of investment. If the investment is in “artistic and cultural activities” the amount of investment need be only at least 250,000 Euros; if it is in “research activities” it needs to be at least 350,000 Euros; if it is for capitalisation of small and medium-sized companies it needs to be at least 500,000 Euros; otherwise it needs to be at least 1,000,000 Euros.

If the investment is in property which is more than 30 years old or is located in an area of urban renovation the investments needs to be at least 350,000 Euros; otherwise it needs to be at least 500,000 Euros.

If the investment is in job creation the investment only needs to create at least ten jobs in Portugal; there is no set financial amount.

So the Portuguese Golden Visa scheme is a relatively simple and very flexible one, and the amount of investment required is lower than that required by many other countries for such schemes. It is not therefore surprising that it is one of the most popular of such schemes.

Cyprus – Permanent Residency and Citizenship by Investment

Like other countries in Europe, Cyprus offers schemes for residency and citizenship by investment (sometimes known as “golden visas”), whereby an investor can make an investment into the country and thus acquire immigration status for themselves and their family.

Cyprus has a lot to offer to non-EEA potential investor migrants: it is a member of the EU, it has a low crime rate and English is widely spoken.

There are two such investor schemes on offer: a permanent residency programme and a citizenship programme, and the investment requirements for the two schemes are different.

The Permanent Residency Programme enables the visa holder to live permanently in Cyprus without any further immigration permission. The investment must be made into newly-built property (either one or two properties) and must be of at least 300,000 Euros. Family members – including spouses, children up to the age of 25 and grandparents – can be included in the application.

Processing of the visa is relatively fast; typically two months. And the minimum requirement for residence in Cyprus is very minimal: the visa holder must visit Cyprus only once every two years. Whilst the visa holder is of course quite entitled to reside in Cyprus as much as they want there is no legal requirement to reside there on any substantial basis.

The Citizenship by Investment Programme requires a much higher level of investment but it confers very great benefits.

The investor must invest a minimum of 2 million Euros in property. Again, family members can be included in the application, and the requirements for this are broader than for the Permanent Residency Programme, as children up to the age of 28 may be included.

After three years the investor may, if they wish and if it is feasible, sell some of their property, as long as the value of the investment does not fall below 500,000 Euros.

The minimum requirements for residence are the same as for the Permanent Residency Programme (one visit every two years) and the visa processing time – between two and three months – is similar.

The great benefit of this programme is that applicant can immediately obtain Cyprus citizenship and a Cyprus passport. As Cyprus is a member of the EU, Cyprus citizenship confers European free movement rights on the passport holder. This enables the passport holder not just to travel throughout the EEA and Switzerland but also to live, work or study throughout the area.

This enables, for example, the investor to work and carry out business in the EEA without restriction and also allows their children to be educated without restriction.

So for the investor who is prepared to invest 2 million Euros, who wants EU citizenship but does not want to tie themselves down to a European home this could be a very good option.

Portuguese Golden Visa – a Great Success

The Portuguese Golden Visa programme has been a great success.

The Golden Visa – which enables investors and their family members to acquire residence in Portugal and ultimately Portuguese citizenship – has been in existence since October 2012. It has provided a relatively simple and highly flexible scheme for investors to invest in fields of their choice. Depending on the field of investment the required amount of investment can be very low by international standards.

Golden Visa holders who eventually acquire Portuguese citizenship would thus acquire European free movement rights, which provides strong immigration rights throughout all the EEA countries and Switzerland. This enables a person to live, work or study throughout the free movement area with very little restriction. Thus the scheme can bring valuable benefits both for participants and for the Portuguese economy in terms of inward investment.

Official figures show how successful the Golden Visa programme has been. Since the programme started the total amount of investments made exceeds 2.2 billion Euros, and the rate of investment is increasing. In the first half of 2016 up until the end of June the level of investment has been over 500 million Euros (which is greater than for the whole of 2015). The number of investors for the first half of 2016 was 821 and their family members totalled 1,212.

Clearly, this rate of growth is exponential, and the Portuguese Minister of Foreign Affairs has explained that the Government considers Golden Visas to be a priority and that more resources have been put into processing Golden Visa applications. As a result, the processing times are now similar to what they were previously, even though there is now a much larger number of applications. Applications are typically processed within two to three months.

Statistics also show that the most popular field of investment is property and that the Golden Visa is currently most popular amongst the Chinese, but people from many other nationalities are also participating – including of course the Brazilians, who in many cases have ethnic connections and who already speak the language.

So the Portuguese Golden Visa is one of the most successful citizenship by investment programmes in Europe – no doubt because of its favourable terms and flexibility. It enables the modestly wealthy and their families to attain a home in Europe, where they can either live full-time or part of the time, depending on their lifestyle and financial situation.