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Farewell to the «Golden Passport»: The main questions about the closure of the Cyprus citizenship program

Cyprus announced that it would close the citizenship by investment program in two and a half weeks. Ithas been in operation since 2013 and has always been popular among wealthy Russians. Why program closed and where to apply for «gold passport».

What happened?

One of the most popular programs of citizenship by investment - Cyprus - will cease to exist as of 1 November 2020. The Cypriot Presidential Administration reported this today.According to the official version, there are two reasons: shortcomings of the program and abuses in its implementation.

Why did they decide to shut down the program?

As it stands now, the program has attracted much criticism, often fair, therefore its closure was a matter of time, says Forbes Rustam Vakhitov partner in international taxation«Crow Expertise».

Indeed, Cyprus has been under fire for years for its «golden passport» program. In January 2019, the European Commission published a report analyzing the rules for granting EU citizenship by investment. It stated that programs of «golden passports» and«golden visas» exist in two dozen European countries. But it was Cyprus, Malta and Bulgaria that were the focus of the report, as they were actually trading in citizenship. Yet they have problems vetting applicants, which are risks toEU security, including corruption.

What will happen to those awaiting a decision on the passport?

There is no answer to that question.

·     DonatPodiek, partner of KPMG in Russia and CIS, is likely to have a short period during which applicants can obtain a passport on the basis of previously submitted documents.

·     It is possible that the terms of the program will be revised and it will be restarted. But all those who planned to get a passport of Cyprus on the relevant conditions have such possibility until November 1, says Marina Shalayeva the Director of the Foreign Property Department Knight Frank.

·     In the future, it is likely that Cyprus will introduce a new program, but it will be«much more conservative and limited» - believes Vakhitov. The law is not retroactive, so applicants who have already submitted documents and are waiting for a decision should not suffer, said Nikolai Vargasov Head of legal department of UFG Wealth Management.

Full article available in Russian

PR specialist

Evgeniya Zaslavskaya

Evgeniya Zaslavskaya

PR
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