Cyprus' Golden Visa to Be Revised: 12,000 Permits to Be Inspected

Cyprus's golden visa, a permanent residency program for investors from outside the European Union, is set to be tightened. Authorities are reviewing some 12,000 permits issued since 2013 to determine whether their holders continue to maintain the required investments and meet the program's other conditions.

The reform is being prepared ahead of the Republic of Cyprus's planned accession to the Schengen Area. The government anticipates that interest in Cypriot permanent residence may significantly increase after Schengen accession, and therefore wants to strengthen controls and tighten the entire system in advance.

Cyprus golden visa under closer scrutiny

The Deputy Minister of Migration and International Protection, Nicholas Ioannides, announced the upcoming changes during a meeting of the Parliamentary Control Committee.

According to the data he presented, approximately 1,500 permanent residence permits have been issued under the investment program over the past two years. At the same time, approximately 12,000 permits granted since 2013 are currently being reviewed.

The purpose of the inspection is to determine whether the holders continue to maintain their declared investments and meet other requirements for permanent residence. This does not automatically mean the revocation of all permits under inspection.

Each case will be considered individually. However, individuals who no longer meet the program's conditions may lose their previously granted status.

The government wants to change the rules of the program

The detailed outline of the reform has not yet been announced. The deputy minister said he has already presented his proposals to the ministers involved in the program's operation.

One of the directions being considered is expanding the areas where investor funds can flow. Currently, the program is strongly associated with the real estate market, but in the future, investments could also increasingly support education, defense, and innovation.

– We need investments, but they must be made in a controlled manner – stressed Nicholas Ioannides.

It's also possible to introduce more stringent controls on the origin of funds, more effective oversight of investment maintenance, and more frequent document verification. However, at this stage, these are just announcements, not binding regulations.

How does the investor program currently work?

The program, officially known as the Investor Immigration Permit, is intended for citizens of countries outside the European Union, the European Economic Area and Switzerland.

Poles, as citizens of the European Union, do not have to use this procedure to legally reside in the Republic of Cyprus.

The minimum eligible investment is currently €300,000 excluding VAT. The funds can be used for:

• purchasing a new house or apartment from a developer,
• purchase of commercial real estate,
• an investment in the capital of a Cypriot company operating on the island,
• units of a Cypriot investment fund.

When purchasing a house or apartment, the property must be purchased on the primary market. Other permitted forms of investment have different requirements.

Applicants must also document a stable annual income, the minimum amount of which depends on the number of family members covered by the application. They must also provide a criminal record certificate and meet investment maintenance requirements.

The permit gives the right of permanent residence but does not grant Cypriot citizenship or a passport.

Schengen will increase the attractiveness of Cypriot stays

If Cyprus is admitted to the Schengen area, residence permits issued by the republic may become much more attractive to third-country nationals.

Holders of valid permits issued by a Schengen country may generally make short trips to other Schengen countries for a maximum of 90 days in any 180-day period. However, this does not grant them the right to permanently reside or work in another country.

The government predicts that easier travel could lead to an increase in applications submitted to Cyprus. At the same time, the program has been criticized for increasing demand for real estate and putting additional pressure on housing prices.

The current rules still apply

There is no announcement yet on when the reform will come into effect, nor is there any information on whether the minimum investment amount will change. Until the new decisions are adopted, applications will be processed according to the current rules.

The announcement that approximately 12,000 permits will be audited is an important signal to existing program participants. They should ensure they maintain their declared investments, have up-to-date documents, and meet all the conditions under which they received the right of permanent residence.

Sources: Cyprus Mail, Migration Department of the Republic of Cyprus, Parliamentary Scrutiny Committee