Little Dominica as a Laboratory for Immigrant Investor Rules

By David North on November 3, 2015

The American states, as U.S. Supreme Court Justice Louis Brandeis once said, are laboratories for democracy. One can say that same thing about nations, even small ones, and immigration laws.

In fact, the mighty United States can learn a thing or two about immigration programs from a tiny nation most of us do not know exists, Dominica. The island nation, with a population of 72,003, has just about three times the acreage of New York's Staten Island. A former British colony, it is not to be confused with the relatively nearby and much larger Dominican Republic, a former Spanish colony.

Dominica, instead of an immigrant investor program like our EB-5, has an "economic citizenship" program. Both are intended to grant benefits to aliens in return for money, but from there interesting variations surface.

The American program is designed to attract rich new residents; it assumes that alien investors want to live in the United States, or at least have the opportunity to do so.

The Dominican program is a little less self-centered; it assumes that rich aliens want a second passport, with no residence requirements, but bearing with it the opportunity to travel to most nations and granting rights of residence in Dominica and in 14 other Caricom states, such as Jamaica and Barbados. (This passport, however, apparently cannot be used to secure admission to the United States.)

Here are two lessons that the United States could learn from Dominica, assuming that we have an immigrant investor program at all (which I do not recommend):

  1. If more than one person is to get the passport (or in our case, the visa) the nation should charge more; and

  2. Arrange the system so that all residents of the nations, not just a few middlemen, receive benefits from the program.

On the first point, we grant a whole family-sized set of visas to aliens placing $500,000 investments in projects approved, but not guaranteed, by DHS; this is true if there is a single investor or if the investor and spouse have a dozen under-21 children. Dominica has a sliding scale — the larger the family, the larger the needed investment.

On the second point, the only investments accepted by the United States are in for-profit deals, though some to many of them fail. In Dominica, the alien has a choice of a one-time payment to the state or a real estate investment of more than twice that size. My sense is that if the public, via its government, is going to sell the visas or passports, then the public — not some well-connected middlemen — should profit. While the formulae used in the Dominica system are better than ours, the level of investment is not. A single alien, using the government route, can get by with a US$111,250 payment, including fees, but if that alien opts for the real estate path, there is a minimum investment of US$200,000 and government fees of $50,000. Dominica should charge more.

I stumbled onto this information while engaged in a hobby of mine, reading the judgements of the UK's Privy Council, a Brit-staffed supreme court for many of the world's former and all of the current British colonies. A Dominican journalist made unsupported allegations regarding corruption and waste in the real estate portion of the economic citizenship program (think of our South Dakota), was sued for the British version of libel, lost in the lower courts, and then lost again when he appeared before the Privy Council in London pro se.

The Judicial Committee of the Privy Council, unlike our Supreme Court, allows itself to be televised, and one can watch the proceedings and see the wonderful costumes worn by the barristers; the judges, however, have no wigs and no gowns, and simply show up in suits and ties.