August 02, 2024
In the aftermath of the Russia-Ukraine conflict, many citizenship and residency programmes for Russians and Belarusians have been shut down or suspended. Despite the challenges, there are still some viable options for those seeking residency, especially within the European Schengen Area. Fundamentally, this article explores the latest available programmes, highlighting their pros and cons to help applicants make informed decisions.
1. Hungarian Residence Programme
The Hungarian Residence Programme, newly launched in July 2024, offers several investment options, including a €250,000 investment in real estate fund units, a €500,000 direct purchase of Hungarian residential real estate, and a €1,000,000 charitable donation.
Advantages of the Hungarian Residence Programme:
- Schengen Access: Hungary is a member of the Schengen Agreement. This allows residents to spend up to 90 days within any 180-day period in the Schengen Area.
- Neutral Stance: Hungary maintains a more neutral stance compared to other EU countries regarding Russia, making it a more favorable option for Russian and Belarusian applicants.
- Flexibility: The programme does not require a minimum stay, allowing flexibility for investors who may not wish to reside full-time in Hungary.
- Path to Citizenship: After three years of physical residency, investors can apply for permanent residency, and after a further five years of physical residency, they may be eligible for citizenship.
Disadvantages of the Hungarian Residence Programme:
- New Programme: As a new programme, it necessitates careful valuation of real estate investments to ensure compliance and avoid potential pitfalls.
- Renewal Requirement: Residency permits need renewal, which adds an administrative burden and ongoing commitment.
2. Portuguese Golden Visa
The Portuguese Golden Visa has recently lifted its suspension for Russian and Belarusian applicants, presenting a renewed opportunity for investors. Specifically, the programme requires a €500,000 investment in non-real estate funds or a €350,000 investment in research activities or heritage rehabilitation.
Advantages of the Portuguese Golden Visa:
- Schengen Access: Portugal is a member of the Schengen Agreement. This allows residents to spend up to 90 days within any 180-day period in the Schengen Area.
- Proven Track Record: This is a well-established programme with a proven track record, offering a reliable path to residency.
- Schengen Benefits: Successful applicants gain access to the entire Schengen Area, enhancing travel and business opportunities within Europe.
Disadvantages of the Portuguese Golden Visa:
- Lengthy Process: The application process can be lengthy, requiring regular renewals which can be burdensome.
- Investment Risks: With the abolition of direct real estate investment, applicants are now limited to fund investments, which carry inherent risks and lack a long-established track record.
- Citizenship Requirements: Contrary to popular belief, the programme does not automatically convert to citizenship as this requires substantial links, including a long period of physical presence in the country and fluent knowledge of Portuguese before becoming theoretically eligible.
3. Malta Global Residence Programme
The Malta Global Residence Programme is tailored primarily for tax nomads by providing a Tax Identification Number (TIN), but the programme caters for a residency card. Essentially, the requirements include a minimum of an annual tax of €15,000 to the government, approximately €10,000 per year to maintain a residential address, and additional professional fees.
Advantages of the Malta Global Residence Programme:
- Schengen Access: Malta is a member of the Schengen Agreement. This allows residents to spend up to 90 days within any 180-day period in the Schengen Area.
- High Security: Malta's stringent due diligence processes ensure a high level of security and reputation, making it a trusted option for investors.
- Low Capital Outlay: The programme's low capital outlay is advantageous compared to other residency schemes.
- Family Coverage: It covers the applicant, their partner, dependent children, and even house help such as maids or nannies.
- Eligibility: The time spent under the Malta Global Residence Programme counts towards eligibility for Maltese citizenship under the Malta Exceptional Investment Naturalisation (MEIN) and Naturalisation for Exceptional Services by Direct Investment (NESDI) programme.
- Cost Efficiency: Given that the Maltese citizenship by investment regulations allow a one-year option and a three-year option, with the three-year option costing €150,000 less, the irony is that if a person spends three years under the Global Residence Programme, the resulting savings on the three-year option of citizenship actually exceed the total cost of the programme over three years by quite a margin.
- Provides a tax identification number (TIN): Beneficial for tax planning and financial management.
Disadvantages of the Malta Global Residence Programme:
- Renewal Uncertainty: Although the programme is annually renewable, there is no clear timeline on if or when the suspension for Russian applicants will be lifted.
- Residency Commitment: Applicants must commit to not living in any other country outside of Malta for more than 183 days per year to avoid tax residency issues.
4. UAE (Emirati Golden Visa)
The Emirati Golden Visa requires substantial investments in real estate or specific sectors, offering long-term residency with several benefits.
Advantages of the Emirati Golden Visa:
- Stability: The programme provides long-term stability and access to a prosperous and secure region.
- Benefits: Offers various benefits, including opportunities for business, work, and family inclusion.
Disadvantages of the Emirati Golden Visa:
- Schengen Access: Unlike European programmes, the UAE Golden Visa does not provide access to the Schengen Area.
- High Investment: Requires significant financial investment and proof of income.
- Policy Changes: The specifics of the programme can change based on national policies and economic conditions.
Conclusion
In conclusion, while the current geopolitical situation poses significant challenges for Russian and Belarusian applicants seeking residency in the European Schengen Area, there are still viable options available. Malta has long been a trusted option with its established programmes. Additionally, Hungary presents a new opportunity with its recently launched residency programme. Moreover, Portugal, having lifted its suspension, offers a renewed pathway for Russian and Belarusian applicants seeking access to the Schengen Area. Subsequently, with careful consideration and planning, applicants can navigate these complexities and find suitable pathways to achieve their residency goals.
However, it is important to underline that while there are emerging opportunities for Russians and Belarusians, these should not be interpreted as lenient gateways. Fundamentally, individuals with questionable sources of wealth, sanctioned individuals, people working for sanctioned entities, or politically exposed persons with problematic links would face difficulty traversing these systems. The increasing scalability of these programmes and the anticipated harmonization of due diligence procedures, especially with the new Sixth Anti-Money Laundering Directive (6AMLD), will require Citizenship and Residency Advisors to become subject persons. This means they will be obligated to perform rigorous due diligence. Effectively, they will ensure that only genuine clients, who sincerely aim to access the Schengen Area for legitimate purposes, can benefit from these programmes.
