MEPs call for Golden Visa ban



Members of the European Parliament are calling for a ban on ‘Golden Visas’ claiming they are objectionable ethically, legally and economically and pose several serious security risks.

MEPs stress that ‘citizenship by investment’ (CBI) schemes, under which third country nationals can secure nationality rights in exchange for an investment, undermine the essence of EU citizenship and should be phased out.

Sophie in ‘t Veld, a Dutch member of the European parliament, said: “These schemes only serve to provide a back door into the EU for shady individuals who cannot enter in broad daylight. It is time we closed that door, so that Russian oligarchs and other persons with dirty money stay out.

“Member state governments have refused to address the problem, claiming it was not an EU matter. Given what is currently happening, they cannot duck this issue anymore.”

The draft legislative initiative report sets out an array of measures to address problems linked to citizenship and residence by investment schemes. The text calls for ‘a meaningful percentage’ to be levied on the investments made, which would continue while the CBI is phased out, and indefinitely for ‘residence by investment’ (RBI) schemes.

Noting the difference in the severity of the risks posed by ‘residence by investment’ schemes, the draft report asks for common EU rules to harmonise standards and strengthen the fight against money laundering, corruption and tax evasion.

At least 130,000 individuals have taken advantage of the CBI and RBI schemes in the EU between 2011 and 2019, which have generated over €21.8 billion in revenue for the countries concerned.

Twelve EU states have RBI schemes, all with diverging amounts and options of investment, as well as standards for checks and procedures. Three member states have CBI schemes: Bulgaria (where the government has tabled a draft law to end the scheme), Cyprus (currently only processing applications submitted prior to November 2020) and Malta.

Butt is it really a threat?

According to Mohammad Butt, Barcelona office director, Lucas Fox, the Golden Visas do not pose any threat to Spain, or the EU in general.

He said: “We have completed several Golden Visa transactions and the background checks are very tight. Applicants need to provide a criminal record check from their native country and for the property purchase, provide the proof and origin of funds.

“In reality, the Golden Visa Scheme has opened the door to thousands of potential investors looking to benefit from Spain’s historic low property prices and numerous lifestyle benefits, primarily targeting Middle Eastern and Chinese investors, with interest also from the USA, India and Latin America.

“With property prices increasing at a steady yet sustainable pace in Spain, the Golden Visa programme makes for an interesting investment, as the Spanish government has maintained the initial investment level at just 500,000 euros, which is extremely low.

“Investors have the opportunity to purchase a property and immediately secure tenants, bringing in rental income from day one. They can then apply for the Golden Visa, which allows free movement within the Schegan Zone for investors and their immediate family.”

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