Four nations have taken steps to cut back immigrant investor programs recently, three of which are being reported here for the first time.
Those three are Ireland, Portugal, and the U.S.; India’s move was covered in an earlier post. In the case of Portugal and Ireland, the programs are about to be terminated. In the other two instances, there is likely to be a cutback in these visas, also called CBI, for “citizenship by investment”.
According to a February 14 Reuters article, Ireland decided to end its program in accordance with advice from the European Union, which regards such schemes as “security risks”. Russian oligarchs have been major users of these visas.
Two days later, IMIdaily.com reported: “Portugal to Close Golden Visa Program in its Entirety”.
Portugal’s program, unlike those of most CBI nations, is centered around residential real estate. The overseas investor bought a fairly luxurious property, which he needed to visit from time to time; 98 percent of the visas went to the residential program; other forms of investments produced only 2 percent the action. Now neither kind of investments will lead to new visas. Those with the residential visas will have to move into their properties full-time to keep the visas.
To some extent, the Portuguese program was the victim of its own success; it was designed, at least at first, to buoy the real estate market. Time passed and a shortage of housing emerged, partially because of the program.
It is conceivable that some investors, turned off by both Ireland and Portugal, may think of using our troubled EB-5 program.
The news about the U.S. and India is much less dramatic, but leads in the same direction as the others, to slightly reduce the EB-5 program.
In the U.S., the House of Representatives passed the Amigos Act, which among other things shot down efforts by Grenada to outwit our EB-5 system. That technique was to sell its citizenship to aliens (notably ones from China who were blocked from entering the U.S. by long waiting lists), giving them the opportunity to enter the U.S. while they waited for their EB-5 visas to mature by also investing in the (less expensive) temporary E-1 and E-2 visas, as treaty investors and treaty traders, as we reported years ago.
The House voted that one had to be a citizen of Grenada for three years before using this ploy.
India’s Central Bank, as we wrote earlier this month, laid on a 25 percent tax on Indians’ investments in the U.S. under the EB-5 program.