In order to have citizenship in a country, the traditional means have been pretty straight forward. A person will have had to have been born in that country, or apply for citizenship through that country’s naturalisation process. However, times are changing and the business world is among the first to take advantage of these changes. Today there are what is known as investment passports, which is in fact a whole other legal and legitimate way to get citizenship. Citizenship by investment programs are now offered by most countries that want to encourage new business.
So, who are the business people obtaining these types of passports? What are the benefits to them? Well there are a number, as we will discuss.
What is the Citizenship by Investment Program?
While you may think this is a relatively new program, the fact of the matter is that citizenship investment programs (CIPs) have been around for a while now. The islands of Nevis and St Kitts in the Caribbean have the longest running citizenship program in the world, as theirs dates back to 1984. Fast forward to the year 2013 when Malta became the first EU approved citizenship program to be offered.
When Malta announced its plans to offer the program it wasn’t exactly smooth sailing, and their announcement was met with a lot of outcry. A compromise was reached and now the program is available. Cyprus soon followed Malta’s lead in hopes of raising extra money that the country very much needed at the time. Just last year, Cyprus revised its program and made a few changes including the price to invest.
In a nutshell these programs allow people to purchase their citizenship in a country by making an investment in the country itself. Each program has its own cost that is set by the country. Once a person has made their investment, they receive citizenship and are free to live and move about that country just like any other citizen.
Top Five Benefits
So, what are the benefits to business people to essentially purchase citizenship in another country? Here are the top five benefits:
- Gives People a Chance to Access Other Markets – When you think about a person who lives in the United States or Canada for example who is looking to expand into the European market, what better way to go about it than by actually living in Europe and experiencing the culture? The CIP program in Cyprus for example, gives them the right to then live in Europe. This is considered to be very valuable.
- It Makes Traveling Easier and Sometimes Cheaper – For business travellers who are used to having to wait while visas and permits are processed and approved, citizenship can turn that same trip into a breeze. It’s also less costly since you don’t have to apply for any travel documents. It gives business people the ability to pick up and go whenever needed.
- A Way to Avoid Paying Taxes – If the business person is American, taking on that new citizenship will allow them to give up their American citizenship, which means they will no longer need to pay taxes in the U.S. and on the money they make abroad. This double-taxation can really hurt business people.
- Customers Like Knowing You Are a “Local” – When you work in the country of your citizenship it can help your customer base.
- You Have Options – Of course there’s also the fact that if you have more than one citizenship then you have options should you ever need to move to another country.
Look for Numbers to Grow
As it stands, there are about 5,000 people each year that are looking to obtain citizenship through the CIP program each year. As these programs continue to expand and grow in popularity, look for these numbers to grow as more business people start to learn about the benefits it affords them.
Elena spends her time exploring a variety of intriguing and hot topics and then blogging about them. As a busy mum she likes to learn as much about the world as possible, and then share what she’s learned at elenatahora.com.