Investment Migration programs are programs which enable host nations to grant residency or citizenship rights to qualified individuals in exchange for a substantial investment. Since the first investment migration program was established in 1984, today there are about 100 countries in the world that have some form of investment migration legislation in place.
Investment Migration has now matured from being a luxury lifestyle product to becoming a sophisticated investment choice. It now encompasses portfolio diversification, global investment & operations, and the creation of a new inheritance & identity for the family. HNWIs are now increasingly appreciating that acquiring alternative residence or citizenship is a powerful diversification tool.
The residency granted by a country could be in the form of a Temporary Residence Permit, Long Term Residence Permit or Permanent Residence. Permanent Residency normally allows more freedoms to live and work than other forms of residency. While Residency by Investment Programs grant applicants the right to reside in a country, they will have to satisfy residency requirements in order to be eligible for citizenship.
It is possible for a person to hold more than one residency without being physically present in some. Rather than continuous physical presence being a central feature of residency, what is key is either –
- The continuity of the legal entitlement to reside, and/or
- Providing evidence of activities undertaken in the host country for the duration of residency
The above two can be evidenced by any of the following:
- By having an address in the host country for the duration of residency
- Registration at the municipality of legal residence
- An employment contract with a local company
- The business in the host country
Families with multiple passports or residence permits benefit from each county’s best practices and are less vulnerable to single country’s risks, shortcomings and unexpected changing fortunes. The more jurisdictions a family can access, the more diversified their assets will be and the lower their exposure to both country-specific sovereign risk and global volatility.
While the past there was interest in acquiring residency or citizenship of countries such as Australia, Canada, US and UK, in recent years there have been Citizenship by Investment (CBI) and Residency by Investment (RBI) programs offered not only by such traditional destinations, but also by countries that are economically very different. For example, many of the EU countries today offer CBI and RBI Programs, though more offer RBI than CBI Programs. These are attractive to investors owing to their high ranking on the “Quality of Nationality Index”, and the travel and settlement freedoms and stability they offer.
NATURE OF INVESTMENTS
All RBI and CBI programs in the world today grant residence or citizenship in return for any one or more of the following types of investment:
- Active Investments–this requires investors to provide detailed business plans and actively build a business, including satisfying human capital and job creation requirements
- Passive Investments – this requires investors to invest in market securities or in an existing company that the investor will not usually run or in government bonds or the property sector
- Government Donation – this requires paying of a non-refundable amount to a government
Investment options and required investments vary greatly depending on the program and the type of investment.
Some of the top benefits that Residency and Citizenship Investment Immigration Programs worldwide offer are as follows :
- Quality of Life: This is one of the prime reasons why people opt for Residency by Investment and Citizenship by Investment The increasing awareness and knowledge people now have of various countries and/or regions offering economic migration programs such as the European countries offering citizenship by investment, and also the fact that they are now travelling much more, gives them an insight into the very high quality of life prevailing in many countries including access to better basic services such as healthcare, education, security and travel. These aspirations can now be fulfilled via such economic migration or investment migration programs, which allow families to access these benefits from a large number of alternate countries.
- Education: Education of children is top priority for parents worldwide. Having their children study in the top educational institutions is a dream for most. By obtaining residency and/or citizenship in alternate countries, parents are able to ensure that their children benefit from the following:
- Considerably reduced tuition fees
- Possibility to work during and after study, without having to apply for another visa
- No need to look for a sponsor for a work visa after completion of studies
- No need to apply for an immigrant visa after completion of studies
- Upon completion of studies, children can even opt for setting up their own business or start-up without having to go through the process of applying for any further visas.
- Process of permanent migration & subsequent citizenship is much faster
- Expansion of business: Businessmen in many countries face major hindrances in establishing new businesses or expanding existing business abroad, and even in travelling abroad. The Business Migration Programs on offer by some countries enable them to travel freely to favored destinations for business expansion and collaborations, in the process opening up new opportunities and technologies they can have access to.
- Visa free Travel: The type of passport you possess has a huge bearing on where in the world you can go and with whom you can do business. This limits the opportunities for investments, business partnerships and tax efficiency. Freedom to travel is one of the major benefits of Residency and Citizenship investment migration Being able to avoid costly and time consuming visa applications and act on travel plans very quickly because of the large number of countries to which these programs allow visa-free travel, is a major factor in favor of such programs.
- Tax Planning: Residency and Citizenship investment immigration programs allow investors considerable benefits in tax planning. The extent of these benefits primarily depends on
- The incentive offerings of the country to which an investor is migrating, and
- Where the investor decides his primary tax residence will be.
Tax planning must go hand-in-hand with any migration goal one might decide upon. Contact us for choosing the destination that encompasses all relevant factors and is best suited for you.
- Wealth management and Portfolio diversification: Residency & Citizenship investment migration programs offer HNI investors an option to diversify their investment portfolio and engage in more prudent wealth management.
- Reunion with family abroad: Strict visa regimes in many countries sometimes mean that families are split apart with little hope of reunification. Residency and Citizenship investment migration programs present an avenue for families to re-unite.
- Retiring abroad: Some of the countries which offer Residency and Citizenship Programs are amongst the most exotic, beautiful, safest and healthiest places on the planet, also offering visa free travel to a very large number of countries in the world. Choose your own little paradise to retire to, by investing in one of these investment immigration
- Avoiding political and economic instability: For citizens living in countries with high political and economic unrest, this factor assumes a lot of significance. A second citizenship program and a second passport provide an escape route from potential conflict, civil unrest or travel sanctions imposed by or upon your home country.
Also read :
The Importance of Residency & Citizenship Programs in a post-pandemic world
India’s millionaires increasingly looking at alternative Residency & Citizenship programs
The importance of Residency & Citizenship programs in a post-pandemic world