European Commission has decided to seek a plan to abolish investment programs for the Naturalisation of investors.


In a particularly difficult period, in the midst of the pandemic of the corona and the economic crisis it has created, in all the Member States of the European Union, the European Commission has decided to seek a plan to abolish investment programs for the naturalisation of investors.

Cyprus also received such a letter on April 1, 2020. According to a Commission spokesman, who was asked by “F”, the letter in question “falls under its (Commission’s) commitments to monitor investment programs for naturalization and permanent residence in the EU.” and to continue the dialogue with the Member States. The Commission recently sent another round of letters to the Cypriot, Maltese and Bulgarian authorities on April 1st in connection with the investor naturalization program. ”   
Although the Commission spokesman did not want to comment on the content, however, according to information obtained by “F”, one of the Commission’s demands is to submit a specific plan to record the manner in which its naturalization plan each country will begin to be restricted until it is finally terminated.

Both the content of the letter and the time period in which it was sent are strange. First of all, because the Commission does not have the right to impose on member states the abolition of such national programs. Secondly, because a time period has been chosen in which each Member State is faced with a deep recession and is trying in every way possible to cope with the difficulties created by the forced lock down of their economies. In the case of Cyprus in particular, no letter with such content was expected, when in recent months and after the problematic cases that saw the light of day, all efforts were focused on strengthening the controls carried out for the purpose of approving applications from investors who wish to acquire Cypriot citizenship.   

It is indicative that the resumption of the naturalization plan is not only one of the measures promoted by the government to reduce the impact on the economy, but is also included in the proposals of some of the parliamentary parties.  
Asked about this, Interior Minister Nikos Nouris confirmed the letter and the existence of the issue in question, ie whether the government intends to submit a program for the gradual termination of the investment plan. He added that he had responded to the letter, stressing that there was no intention to end the program. “With the measures taken after May 2019, we believe that not only is there no reason to terminate, but on the contrary, the control that is now in place is excessive.” He added that in mid-February he had the opportunity to present the revised provisions of the Cyprus Investment Program to the EU’s Commissioner for Justice and Consumer Affairs, Didier Reynders in Brussels, answering all the questions that had been asked. “As I mentioned in the letter,

Millions are being released
As it has already become known, the government has decided to expedite the examination of applications submitted in recent months and are pending, in an effort to directly stimulate the economy and especially the land development sector and indirectly state revenues. As is the usual practice, it is estimated that today, hundreds of millions of euros are tied to escrow accounts until the examination of applications for naturalization and the final delivery of real estate is completed. This is also one of the reasons why construction sites may soon start operating, if epidemiological data allow, to complete some pre-sold projects. There are also cases of projects that have been sold, but the price is gradually paid,

The government does not seem to be willing to play the role of a “good student” in the demands of Brussels this time around, as, although it does not officially say so, it is not satisfied with the way the unprecedented crisis brought about by the Crown Prince is being handled. After all, he has repeatedly stated that there is a willingness, -although there has been cooperation- in relation to the preparation of a common set of rules that will govern such programs at European level. The rules were expected to be ready by the end of 2019, however, the relevant process has not yet been completed, resulting in delays.

Regulations and interest
The government will immediately proceed with the submission of regulations that will concern the program, in order to obtain the approval of the Parliament. The new regulations will be embellished with the presentations of the three-member Committee appointed by the Council of Ministers, and as “F” has rewritten, a special link will be made with the procedures against money laundering. The naturalization program was also one of the most intense reports in the recent Moneyval report on Cyprus.
However, in the midst of all these negatives of recent weeks, it is expected that when the virus cycle closes, China’s interest in real estate will return and turn more to more sparsely populated areas and mansions in more open spaces. Land development entrepreneurs, for their part, are already preparing for the next day, creating online tours of properties available for sale.  

Author :Antonis Antoniou