In March of 2021, the Cypriot government made revisions to Regulation 6(2) of the Aliens and Immigration Regulations, with the aim of attracting foreign investments to the island and with the aim of promoting economic growth.
These amendments were part of the government's broader strategy to stimulate foreign investment in sectors beyond real estate.
The Council of Ministers recently approved a proposal by the Ministry of Interior to review the criteria for granting Permanent Residency to Investors under Regulation 6(2) of the Aliens and Immigration Regulations.
The primary objective of these reforms is to establish safeguards and ensure a secure and transparent process, which will ultimately benefit the Cypriot economy in the long-term by maintaining the integrity of immigration procedures.
Constantinos Ioannou – the Minister of Interior – emphasized the goal of fortifying the process and eliminating identified weaknesses. Although the required investment amount remains the same, control mechanisms have been introduced to ensure that applicants maintain their investment on a permanent basis. According to the Minister, the decision to revise the existing policy of the Ministry of the Interior, which is aimed at stimulating the real estate market and the broader economy, was made due to the clear need for the re-evaluation of certain provisions.
These changes were announced on May 2nd 2023. While we acknowledge and respect the underlying objective of maintaining the system's integrity, it remains to be seen how these new provisions will impact investments.
The revised criteria for granting Immigration Permits to third-country nationals who invest in Cyprus are now as follows:
- The investor must invest the amount of the 300,000 euros,
(whose origin arose from legal activities overseas), in the below
- Buy a house from a developer that is at least the amount of 300.000 euros + VAT (first purchase);
- Make an investment in properties which will be used for purposes other than residential ones – for example: hotels, offices, shops, etc. This can be a second purchase;
- Invest in share capital of a Cypriot Company with activities and staff in Cyprus: Initial investment in share capital of a new company worth €300,000 or an increase of share capital worth €300,000 in an existing company registered in the Republic of Cyprus, which is based and operates in the Republic of Cyprus and has a proven physical presence in Cyprus and employs at least five (5) people;
- Make an investment in shares of a Cyprus Investment Organization for Collective Investments (type AIF, AIFLNP, RAIF): Investment worth €300,000 in shares of a Cyprus Investment Organization for Collective Investments whose investments should be made in the Republic of Cyprus. Provided that, any alienation of the holder of the Immigration Permit from the investment he has made without immediately replacing it with another of the same or greater value, which should meet the conditions set in this procedure, will entail activation of the procedure cancellation of the License based on the provisions of Regulation 6 of the Aliens and Immigration Regulations.
- Applicants will be required to provide annual evidence of maintaining the initial investment and meeting the income requirements for themselves and their family, which stems from overseas legal activities;
- Failure to provide the necessary documents will result in the cancellation of the immigration permit for the applicant and their family;
- The minimum annual secure income for the main applicant has been increased to €50,000 (instead of €30,000), to €10,000 for each minor child (from €5,000), and to €15,000 for spouses;
- Unmarried children between the ages of 18 and 25 – only when they are proven to be higher education students abroad on the date of the application, and who are financially dependent on the applicant – may submit their own, separate application to obtain an Immigration Permit by submitting the corresponding fee. In such a case, the father or mother and/or both parents together must present an additional annual income of €10,000 for each such dependent child;
- Stricter checks and mechanisms are implemented to safeguard the initial as well as the on-going process.
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