Cyprus sets restrictions to RBI program, raises minimum income criteria

Cyprus, the EU island nation, has announced new rules for foreigners seeking permanent residency through investment, after the Interior Ministry's proposed revisions were approved by the Council of Ministers on Friday, 21 April 2023. The changes take effect 2 May 2023.

What's changing

The investment threshold stays at €300,000, but minimum income requirements have risen sharply:

• Main applicant: from €30,000 to €50,000 a year
• Spouse: an additional €15,000 in income must be shown
• Each minor dependent: an additional €10,000 in income must be shown

Michalis Anastasiou, partner at Evagoras Anastasiou & Associates, said the higher €50,000 threshold is meant as a safeguard, since the previous income level was seen as too low and left the program exposed in international efforts to combat tax evasion.

Investors who already hold Cypriot permanent residency by investment must now provide annual evidence that they still hold their qualifying investment and meet the income threshold — failure to do so terminates the residency for both the applicant and dependents. Parents, parents-in-law, and adult children no longer qualify as dependents under the new rules.

"[The changes were made] to revise the existing policy of the Ministry of the Interior, which aimed to stimulate the real estate market, but also more broadly the economy, was taken because it had become clear that certain provisions needed re-evaluation," — Cyprus Interior Minister Constantinos Ioannou

A further update announced 27 April 2023 requires the €300,000 investment to be paid in full before a visa application can be lodged, regardless of a real estate project's delivery status, with funds required to come directly from the main applicant's (or dependent spouse's) own account.

Local industry professionals broadly welcomed the stricter rules. Celia Pourgoura, director at Pourgoura & Aspri LLC, said countries are entitled to adjust their immigration policy, particularly outside the Schengen area, and that tighter criteria can make a program more sustainable by inviting less scrutiny.

A wider EU trend toward restriction

As golden visa programs expand elsewhere, EU member states are increasingly tightening their own. Portugal and Ireland have both moved to end their programs entirely, while Greece doubled its investment threshold in certain areas to protect the property market from inflated prices. EU legislators are also pushing member states toward stricter due diligence, and are calling for an end to citizenship-by-investment programs altogether — the EU parliament has taken Malta to the EU court over its program. Cyprus itself previously ran a citizenship-by-investment program that ended in 2020 amid corruption allegations, and has since revoked multiple citizenships granted under it.

Source: Uglobal