Covid accelerates India’s millionaire exodus

Of note:

India’s wealthy have topped a list of people seeking to relocate abroad through visa programmes that offer citizenship or right of residence in other countries in return for investments.

There was very little Rahul (name changed) didn’t have going for him, when he made the tough call to leave India six years ago. He is the second generation scion of a well-heeled Delhi-based family. They have a flourishing exports business with a monopoly in what’s typically called a ‘sunrise sector’- an industry that has great future prospects.

But he left it all behind and moved to Dubai in 2015, to look after the company’s overseas expansion. He also got a citizenship by investment in one of the Caribbean nations. Harassment by tax authorities in India’s Enforcement Directorate was a key reason, he says.

“I could see it becoming a problem for someone who had businesses spread across the world,” he told the BBC. “With a foreign passport, the red-tape has reduced substantially. I am less worried about being slapped with a random tax demand.”

‘Tax terror’ has been a routine gripe among Indian corporate tycoons. When the founder and owner of India’s largest coffee chain, Cafe Coffee Day died in 2019, he accused a former director general of the income tax department of harassing him. But the government has continued to tighten its noose around business owners in recent years.

According to one report, tax searches by India’s income tax department have more than trebled in the last few years.

The government has argued this is being done to eradicate “black money – illegal cash, hidden from the tax authorities – and improve tax compliance. But critics say the overreach is also often on account of pressure on bureaucrats to meet revenue targets.

But hounding by the taxman was just one reason for his move, says Rahul. His decision was also prompted by a growing trend of “divide and rule politics” in India, he told us. He didn’t want his kids to grow up in India’s increasingly polarised environment.

Many others in his circle of wealthy friends were also renouncing their citizenship or resident status, he added.

These claims are borne out by figures from the wall-street investment bank Morgan Stanley. A 2018 bank report found that 23,000 Indian millionaires had left the country since 2014.

More recently, a Global Wealth Migration Review report revealed that nearly 5,000 millionaires, or 2% of the total number of high net-worth individuals in India left the country in 2020 alone. And Indians topped a list compiled by the London-headquartered global citizenship and residence advisory Henley & Partners (H&P), of those seeking citizenship or residency in other countries in return for monetary investments.

Covid-19 has been a big driver of what was an ongoing trend of wealthy Indians seeking to “globalise their lives and assets” according to H&P. So much so that the firm set up its office in India in the middle of the lockdown last year to cater to growing demand.

“I think they [clients] are realising they don’t want to wait for the second or third wave of the pandemic. They want to have their papers now that they are sitting at home. We refer to this as the insurance policy or Plan B,” Dominic Volek, Group Head of Private at Henley & Partners told the BBC on a video call from Dubai.

According to Mr Volek, the pandemic could be a game changer, because it is making the wealthy think about migration in a more holistic fashion. It is no longer just about visa-free travel, or ease of access to global markets, but about wealth diversification, better healthcare and education, to protect against the uncertainties brought about by the pandemic.

Countries like Portugal, which runs a ‘golden visa’ programme as well as countries like Malta and Cyprus are preferred destinations for India’s well heeled, according to H&P.

This exodus of big money is not necessarily permanent in nature – people merely invest money in another country as a fall-back option rather than take out all their money from their home country and cut business ties. But it doesn’t bode well for a developing nation like India, say experts.

“When this happens, they remove themselves, their entrepreneurial ability and their income and wealth from the tax base. This is likely to be detrimental in the long run. Their exit sends a poor signal about the ‘doing business climate’ in India,” says Rupa Subramanya, Distinguished Fellow at the Asia Pacific Foundation of Canada.

Andrew Amoils, Head of Research at New World Wealth, a Johannesburg-based wealth intelligence group, told the Business Standard newspaper: “It can be a sign of bad things to come as high-net-worth individuals are often the first people to leave – they have the means to leave unlike middle-class citizens.”

Source: Covid accelerates India’s millionaire exodus

@ASemotiuk: How To Fund Biden’s Infrastructure Plan Using Immigration

Benefits of investor immigration and citizenship-by-investment schemes over stated along with risks of corruption. Great benefits for immigration lawyers and consultants, however:

Recently, President Biden unveiled a $ 2 trillion infrastructure plan to fix roads and bridges, while boosting research and tackling climate change. Calling it a “once-in-a-generation investment in America,” he introduced the plan to address the inequalities exposed by the pandemic and to heal America’s economy from the bottom up. More recently, Biden specified how he would raise the money through higher corporate taxation. But could there be a better more creative way?

How Much Is That?

If you are anything like me, you’re not entirely sure just how many zeros there are in a trillion. I had to look it up, and it’s 12 zeros. In other words, President Biden’s infrastructure proposal would cost exactly $ 2,300,000,000,000. It has been estimated that $1 trillion worth of one dollar bills stacked one on top of the other would measure 109,220 kilometres. Put another way, if you stacked up all the dollars in President Biden’s plan one on top of another, they would reach half way to the moon. That’s a lot of money. While Biden has set out his corporate tax proposal as a way to fund it, he has indicated he is open to suggestions on this theme.

Raising Taxes Has Been Proposed

It seems to me there are basically three ways America could pay for President Biden’s plan. The first way is to raise taxes. Biden argues that for those taxpayers making less than $ 400,000 per year there would be no tax increase. Instead he has proposed to raise taxes on large corporations and high net worth individuals. It is clear that Republicans want none of that and will fight tooth and nail to oppose the plan. Let’s face it, rich people and big corporations just don’t want to pay for this proposed program. With the Democratic majority in both Houses, Biden may be able to shove the plan down their throats. Or he may not. That drama will play out in the weeks ahead. But let’s keep an open mind about this.

A Second Alternative

A second alternative would be to go further in debt, increasing the federal debt from its current $ 21 trillion to $ 23 trillion. This would be like drawing down even more debt on a federal credit card that has long ago already exceeded its limit. So far, with interest rates at record lows, going into debt has been workable. The challenge there is the day when holders of American dollars lose confidence in them. That’s when interest rates will start rising and the federal debt will become unmanageable. Until then though, just printing more money could work. This would be the lazy way out of the challenge, seemingly the least painful way immediately, but likely to cause a terrible hangover down the road.

But there is a third way. And this fits with the already mentioned Biden’s willingness to consider alternatives.

Paying For Infrastructure Repairs Using Immigration

The third way would be to adapt an investor immigration program to pay for at least some of the infrastructure plan. The current U.S. EB-5 investor immigration regional center program includes a component in which foreign investors invest $ 900,000 for a period of five years on a project approved by the U.S. Citizenship and Immigration Service (USCIS). Each application must create at least 10 new jobs and enables such an investor and his or her family to immigrate to the United States permanently. Out of about one million applicants who immigrate to the United States each year, current allowances allocate only 10,000 slots to such foreign investors and their family members. However, it would not be hard to imagine how this program could be altered to help pay for Biden’s plan over a period of time. That would mean we would get the same result Biden proposes, without it costing Americans as much since the cost would be paid by new foreign investment brought into the country.

Suppose, for example, we agreed to increase the number of investor-related visas coming into the United States per year from the current 10,000, to say 100,000. Assuming each family on average has four persons, that would mean there would be 25,000 investors coming into the country under such a scenario. If each investor invested $ 900,000 and created 10 new jobs as required under the EB-5 program, that would mean the EB-5 program could generate $ 22.5 billion in revenues and 250,000 new jobs per year.

To be more exact, Biden’s plan calls for over $ 2 trillion in investment to be spent and paid for over 15 years. Using that as a measuring stick and assuming the $ 900,000 per investor would remain the same under the USCIS program, it would mean we would aim to attract some 375,000 investors to the United States over 15 years and earn just under $ 340 billion. However, if you spread this effort out over say a 40-year time frame, such an effort would exceed $ 1 trillion in investments.

Long Term Thinking

There are about 15 million millionaires in the world today outside of North America. This plan would call on attracting less than 10% of them to America over the next 40 years. That may not be easy, but maybe it could be done. The key thing is that such a program would generate 10 million new jobs for Americans. Assuming such a program was ongoing, the amounts invested would be repaid with ongoing investment over time. Further, this doesn’t even consider what other investments each such family would make in America as they buy houses, send kids to schools and spend money on consumer goods.

Maybe these assumptions about the EB-5 program are too unrealistic or miss the mark in some way. Even so, they do illustrate how the EB-5 program could help defray at least some of the costs of Biden’s proposal if used in combination with other ways of funding it. By tinkering with the various options available, a package may be created that will impose less of a burden on U.S. taxpayers and spur the economic recovery at the same time. It is worthwhile to consider these alternatives in this context.

Source: How To Fund Biden’s Infrastructure Plan Using Immigration

Antigua PM accuses US of trying to kill Caribbean citizenship by investment programs

Of note:

Antigua and Barbuda’s Prime Minister, Gaston Browne, is accusing the United States of America of trying to “kill” the Citizenship by Investment Programs (CIP) in the Caribbean.

Browne said to listeners on his weekly radio program Saturday gone, that “It seems as though they don’t want us to operate the CIP so they want to kill it”

“They attacked St Kitts and Dominica too. And they do that so often I don’t even know what to say. But anytime they kill it, countries like Dominica and St Kitts, their economies will be decimated and they will plunge tens of thousands of people e in poverty and then you end up with so many social ills,” said

His comment comes on the heels of a report last week, where the US government cited the CIP in three Caribbean countries for “lack of transparency”.

In the ‘Corruption and Lack of Transparency in Government,’ section, the 2020 report identifies the CIP programs in Antigua & Barbuda, Dominica and St. Kitts & Nevis as citizen concerns on oversight and corruption due to a lack of openness.

In Dominica, the US report pointed to local media and opposition leadership, who continue to raise allegations of corruption within the government, including in the Citizenship by Investment program and pointed to the fact that while the law provides criminal penalties for corruption by officials … the government implemented the law inconsistently.”

And in St. Kitts & Nevis, the US report pointed to media and private citizens reporting on government corruption “occasionally” even as citizens “expressed concern about the lack of financial oversight of revenues generated by the Citizenship by Investment (CBI) program.”

Browne said instead of using information to disparage these countries, the United States should instead work with these small island developing states.

“Let us work together and strengthen the relations with the United States, Dominica, St Kitts…. I mean trying to use this information to disparage us is unhelpful. If it was truthful, I would understand,” he said.

The CIP Programs in the Eastern Caribbean countries have been a source of continued criticism by the US and many nationals locally who question the use of “donation” funds that are part of the attractive offer for a second passport in these jurisdictions and visa free travel to between 152 and 162 countries.

Five Caribbean countries offer the CIP programs but neither Grenada nor St. Lucia were cited for lack of transparency in the report.

Methodology for Investment Migration Programs 2021 (Henley & Partners)

For those of you interested in indexes and citizenship and how the private companies make their assessment:

In constructing the Global Residence Program Index (GRPI) and Global Citizenship Program Index (GCPI) we have referred to multiple sources and experts to obtain and interpret the primarily qualitative data used. We have relied principally on the expertise of residence and citizenship analysts and the experience of investors and government officials. As a result, the explanatory power that supports the scores in the different categories is based on surveys, interviews with respondents, and opinions solicited from selected experts. Where possible, the subjectivity of the various factors has been assessed against publicly available data and widely accepted composite indicators.

The data for surveys and interviews has been consistently collected from a representative sample that includes respondents, experts on citizenship, and practitioners who have been involved in the design of qualitative research in global mobility and related spaces. The sample frame for respondents consists of existing and potential investors, their advisors, and government officials in countries that either already have, or are in the process of establishing, investment migration programs. Relying on potential clients means that the responses of those who decided against proceeding with any program are also included. It may also be noted that among our respondent and expert base are government officials and consultants engaged in investment migration programs that have been discontinued as well as those that are in the process of being established or reformed.

The factors that are analyzed in each of the indexes are as follows:

Global Residence Program Index

  • Reputation
  • Quality of Life
  • Visa-free or Visa-on-arrival Access
  • Processing Time and Quality of Processing
  • Compliance
  • Investment Requirements
  • Tax
  • Total Costs
  • Time to Citizenship
  • Citizenship Requirements

Global Citizenship Program Index

  • Reputation
  • Quality of Life
  • Visa-free or Visa-on-arrival Access
  • Processing Time and Quality of Processing
  • Compliance
  • Investment Requirements
  • Residence Requirements
  • Relocation Flexibility
  • Physical Visit Requirements
  • Transparency

Reputation 

Reputation relies on the perceptions of investors and advisors regarding the image of the countries in which they invest. This indicator is subjective by nature, but much like the Attractiveness Indicators employed by the IMD in its Executive Opinion Surveys, our intention was to allow our respondents and informants the space to consider intangible and unanticipated factors while assessing the reputation of destination countries.

Endeavoring to assess reputation is not new, and the relationship between reputation and outcome is a popular mechanism for assessing the competitiveness of organizations, cities, and even regions. Furthermore, the reputation of a country, much like the reputation of a corporate, is a historical indicator that allows its previous efforts to meet investor expectations to be assessed.

Quality of Life 

The assessment of Quality of Life (QoL) uses a wide range of methods to evaluate subjective perceptions of various sample groups in different contexts, as well as developing factors that are independent of subjective perceptions. Like Reputation, QoL could well benefit from considering investors’ experiences and what is particularly relevant to individuals who are interested in investment migration.

We are aware, moreover, that there are substantial institutional efforts in developing composite indicators for QoL — the United Nations Human Development Index is one of the most comprehensive (relying on life expectancy at birth, schooling, literacy rates, and gross national income per capita). These factors do not cover all civil and political liberties though; for assessing democratic values, Freedom House’s Freedom in the World report is a preferable indicator.

As our focus is also on investment, the World Bank’s Doing Business reports are pertinent, since investors may have to negotiate the regulatory environment of destination countries for a variety of economic activities. We have sought to anchor the framing of our questions in established indicators but recognize that such indicators do not always correspond to what is being assessed in the GRPI and GCPI.

Visa-free or Visa-on-arrival Access

The methodology for this factor is relatively straightforward. It aims to measure an improvement in the mobility of an investor, or their ability to enter additional countries visa-free or with visa-on-arrival access as a result of being a citizen of, or resident in, a particular jurisdiction.

For the GCPI this factor relies on the 2021 Henley Passport Index, which curates data from 227 different travel destinations (including countries, territories, and micro-states), collated by the International Air Transport Association, to arrive at the ranking. The Henley Passport Index compares data on the number of destinations that a citizen of a given country can visit without requiring a prior visa. A relaxed travel policy is worthwhile in itself, but it also characterizes a country’s political regime and the extent of its civil liberties.

While acquiring alternative citizenship is more directly linked to ease of travel, an alternative residence can also enhance the mobility of individuals. It thus also features as a factor that motivates residence investments and is included in the GRPI.

Processing Time and Quality of Processing

Processing time for applications and their quality of processing are two distinct aspects that are assessed differently. Some countries may offer a short processing time between lodging an application and issuing a visa or permit, but there may be uncertainties in administrative processes. In this regard, input from respondents has proved valuable: the responses and analysis thereof have verified the official or declared processing time and complemented the ‘hard’ data on actual processing time taken (namely, the number of days), including obstructions faced.

Compliance

Countries have different procedures and varying due diligence requirements for profiling applicants (including criminal records and financial statements), sources of funds, the manner of fund transfers, and the vulnerability to abuse of the funds invested. The standard measures adopted are best practices developed by international associations and professional agencies for anti-money laundering, counter-terrorist financing, and anti-bribery and corruption. The EU, unlike the USA, does not have a joint or federal procedure for conducting due diligence, so EU countries differ widely in terms of their national rules. Clear information and frameworks regarding due diligence facilitate better risk assessments for potential investors. A more intensive due diligence requirement may be an advantage as this translates into less uncertainty in private investments. Since financial institutions usually engage in Know Your Customer audits regardless of the regulations of investment migration programs, they are less vulnerable than private investments. Vulnerability to money laundering in different sectors could, furthermore, be avoided in the presence of clear regulations.

Investment Requirements

The upfront investment amounts for residence differ in terms of amount required, nature of investment, and additional costs. For this indicator, we consider the required investment amounts. The range in the stated amounts is broad and the nature of the investment is not always left to the discretion of the investor. Options for different forms of investment are specified by the destination governments, largely depending on policy considerations and benefits to the respective countries. Generally, a country offering more choice in how to invest and requiring lower investment amounts (including additional costs) scores higher.

Because of the unique nature of citizenship-by-investment (CBI) programs, investment amounts are substantial, and the accompanying conditions do not allow much choice in the nature of the investment. There is a noticeable pattern to the investments required for CBI programs: the investment amounts are generally greater than those required by residence-by-investment (RBI) programs, there is usually a requirement or at least an option to purchase real estate, and there is usually a requirement or an option to make a non-refundable contribution.

Tax

This factor raises the question of the extent of the tax burden that a resident is required to bear for both corporate and personal economic activities. It is rare for a country not to impose any taxes on its residents. The only two countries in our indexes that have that distinction are Monaco and the UAE, since they do not impose personal income tax, property tax, capital gains tax, or net worth taxes. For all other countries, preferential tax schemes and tax waivers, and incentives for applicants with significant investments heavily influence the score arrived at for this factor.

Total Costs

The stated investment amount does not always constitute the total actual cost an investor must bear to acquire residence status. As the nature of investment differs considerably across programs, it is difficult to compare the total actual cost of investment. Programs that offer a range of investment options score higher in this sub-indicator. Some investors have, however, raised questions about the uncertainties and volatility of foreign markets and therefore the value of choosing options that appear to be safer. Generally, destination countries that reduce investors’ opportunity costs by providing a wider choice of investments or by offering incentive-based investments are considered by investors to be more attractive.

Time to Citizenship

The time it takes applicants to gain citizenship is one of the criteria for assessing a RBI program’s attractiveness.

This refers to the process of naturalizing as a citizen once already a resident, which is distinct from direct CBI. Countries that have appeal in this regard offer a relatively fast path to citizenship, mainly because the time it takes to naturalize is comparatively short. However, this factor considers both the formal time required and any physical presence requirements. Countries with prohibitive rules governing the transition to citizenship score zero.

Citizenship Requirements

This factor examines all the requirements to qualify for naturalization after the specified minimum time has been fulfilled, including physical presence requirements, additional investment requirements or other ‘commitment’ requirements, and other requirements to qualify for citizenship, such as language requirements and cultural integration tests. In some countries, the transition from permanent residence to citizenship is less demanding and there are minimal additional requirements. Other countries have stringent physical presence but few additional requirements.

Residence Requirements

None of the countries ranked in the GCPI impose demanding conditions of residence. Smaller countries keen on attracting investment use waivers or substantial reductions in residence requirements to their competitive advantage.

Relocation Flexibility

An assessment of the number of citizenship investors in the different countries reveals that a substantial percentage of them apply for the migration of family members with the intention of either settling in the destination country or keeping the option open in case they need to leave their home countries. For this factor, we evaluated first the number of investors who indicated their intention to relocate and compared it to the number of investors who have relocated, in order to gauge which countries are conducive to relocation. Subsequently, we assessed the factors facilitating relocation. In this regard, EU member states have a clear advantage because a citizen of an EU member state can consider relocating to another member state or to a choice of several additional countries that have agreements with the EU, such as Switzerland. Though such relocation is not automatic, the rules are well established, they provide clarity on how and when relocation to another EU member state is permissible, and the process entails lower information costs. Destination countries’ efforts towards enabling family unification, and the ease with which they deal with private property, reduce the uncertainties that relocation can entail. Furthermore, for citizens who can support themselves financially, EU law imposes very few restrictions on their freedom to relocate.

The rule of law plays an important part in informing investors’ choices in relocation: their confidence in an existent fair process for securing personal freedom, settling investment disputes, and the legal wherewithal to negotiate with government authorities, all point towards a higher score.

Physical Visit Requirements

This indicator assesses whether physical visits are required as part of the application process, usually for interviews, oath-taking ceremonies, and passport renewals, by evaluating the number of visits required and the bureaucracy of the processes that precede them.

Transparency

The World Economic Forum’s transparency indicators for CBI programs are: public support, evaluation studies, availability of public data, and due diligence criteria. No GCPI countries publish evaluations of CBI inflows, but the other criteria inform the structure and content of the surveys, which inquired about access to clear information on application processes, including due diligence, and how funds are used. Although many investors wish to understand, and preferably choose, where their investments are used, investments are often deployed in predetermined ways, making it difficult to influence their use. The visibility of such contributions in domestic projects and the earmarking of funds influence investors’ decisions and perceptions of program transparency.

Circulating such information is advantageous as it enables investors to conduct meaningful risk assessments. Furthermore, the impact of investments on potential and existing businesses could influence business decisions. The pivotal aspects for transparency are program rules and regulations, and processes and their implementation in program administration.

Source: https://www.henleyglobal.com/publications/investment-migration-programs-2021/methodology

IMC Defends Sovereign and Societal Value Creation of Investment Migration Programs [citizenship-by-investment]

Of note. The international lobby group for citizenship-by-investment programs argues (unconvincingly) its case. No Canadian firms that I recognized:

The two-month deadline set by the European Commission for the governments of Cyprus and Malta to reply to the letters of formal notice regarding their citizenship-by-investment pathways is approaching. In advance of this date, the Investment Migration Council (IMC) wishes to engage with all relevant stakeholders and remind them of a number of salient points.

The legal case

The right to assign citizenship is very clearly the sole competence of a sovereign state. This analysis of the European Commission’s legal case has nothing to do with whether one agrees with the concept of citizenship by investment. The vast majority of EU legal experts argue that the Commission has no legal right to become involved in how sovereign states define citizenship law.

The IMC has sought the opinions of several legal scholars, including Professor Dr Daniel Sarmiento, a leading specialist in EU competence law, and Professor Dr Carl Baudenbacher, the former president of the EFTA court. The conclusion is clear: The EU has no competence in the area of citizenship. Moreover, the concept of ‘genuine link’ that was invoked by the EU is both vague and arbitrary. The European Court of Justice already found in earlier decisions that it is not relevant.

It is therefore unlikely that the European Court of Justice would rule in favour in the matter at hand, as this could have very serious secondary consequences, and could open the way for the EU to encroach on the power of granting nationality, which is reserved, in EU Law, for Member States.

As rightly noted by the European Parliament, “Nationality is defined according to the national laws of that State.”

Strong governance and due diligence

The IMC however understands and shares the concerns of both the EU and wider stakeholders around the question of proper due diligence on applicants to such programs. This is why it has developed, in cooperation with international anti financial crime firms BDO, Exiger and Refinitiv, a common best practice framework and developed a blueprint for good governance through due diligence standards to uphold the highest levels of integrity and transparency. [Download the ‘Due Diligence in Investment Migration: Best Approach and Minimum Standard Recommendations’ Report]

Nevertheless, the IMC suggests that there has been a significant exaggeration of the risks. Working in partnership with Oxford Analytica, the leading geopolitical risk analysis and advisory firm, it has identified that for all the publicly voiced concerns, the due diligence and governance in place already acts as a powerful deterrent. [Download the ‘Due Diligence in Investment Migration: Current Applications and Trends’ Report and the ‘Citizenship by Investment Programmes: An EU Risk Assessment’ Report]

Oxford Analytica found that the operational reality is that investment migration risks are primarily theoretical in nature. This assessment is broadly shared with the intelligence, security, and law enforcement professionals involved in managing investment migration. Potentially nefarious activity is a negligible percentage and compares very favourably to other legal migration pathways.

There are, of course, enhancements that should be made at corporate, sovereign state, and intragovernmental information sharing levels. The IMC and its membership community are committed to the highest of standards. We want to work in partnership with the relevant stakeholders to devise a formal regulatory system that mirrors those of financial and professional services providers and that will ensure the necessary protection. That system should be based on an objective and knowledgeable analysis of the reality of investment migration, not one that is based on scare stories and rumour.

A creator of societal and sovereign value

Investment migration is a vital lever for sovereign nations to raise debt-free capital, attract talented individuals, and deliver benefits to society as a whole. In Malta, to mention but one example, the Individual Investor Programme attracted EUR 1.4 billion directly into the island nation’s economy following the damaging Euro crisis. This liquidity has had profoundly positive consequences. There has been significant employment creation across all levels of society, and the Maltese government has greater autonomy to invest in vital infrastructure projects, some of which involve critical care for cancer patients.

Bruno L’Ecuyer, CEO of the IMC commented: “Investment migration pathways are now a well-established, normalised wealth management advisory practice. As is the case with other established financial and professional services practitioners, we want to work in partnership with all relevant stakeholders to ensure that sovereign and societal value can be maximised through prudent, responsible, and objective regulation.”

For this to happen, all investment migration advisors must run operations to the highest possible standards and be prepared to face the consequences if they are found wanting. Equally, stakeholders must understand that the privilege of granting citizenship and residence rights is solely the domain of a sovereign state, and that significant sovereign and societal value can be created through investment migration, particularly in the Covid era, which moreover in many instances is aligned with the UNs Sustainable Development Goals.

ENDS.

About the Investment Migration Council

The Investment Migration Council (IMC) is the worldwide association for Investment Migration, bringing together the leading stakeholders in the field and giving the industry a voice.

The IMC sets the standards on a global level and interacts with other professional associations, governments, and international organisations in relation to investment migration.

The IMC helps to improve public understanding of the issues faced by clients and governments in this area and promotes education and high professional standards among its members.

The IMC is constituted as a not-for-profit association under Swiss law. Based in Geneva, it has representative offices in New York, London and the Cayman Islands. Managed by a Secretariat under the direction of a Governing Board, the IMC also has a non-executive Advisory Committee, in which the most important industry stakeholders are represented. The IMC is funded by membership fees, donors and income from activities such as events, education, training, and publications.

(Membership list can be found here: https://investmentmigration.org/members-directory/ )

Source: IMC Defends Sovereign and Societal Value Creation of Investment Migration Programs

Green: Canada should revive the investor immigrant program and fix its past failures

Not aware of any studies that show meaningful benefits from investor immigration programs in OECD countries. Green is notably vague with respect to how he proposes to “fix its past failures” beyond increasing the investment threshold. The IRCC evaluation was devastating (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwjN2Z6D2qDtAhX8GFkFHWXyCD4QFjAAegQIAxAC&url=https%3A%2F%2Fwww.canada.ca%2Fcontent%2Fdam%2Fircc%2Fmigration%2Fircc%2Fenglish%2Fpdf%2Fpub%2Fe2-2013_fbip.pdf&usg=AOvVaw2KiDUWqxbDR2xBXtujZnYm) and census data indicates the median incomes based on tax data to be minimal and lower than refugees. Quebec’s comparable program largely serves as a backdoor entry to other parts of the country:

From the earliest days of Confederation, immigration has been essential to Canada’s evolution and identity as a country. The labour – and tax dollars – of successive waves of people from around the world have supported universal health care, pension plans, education, national infrastructure, and the creation of small businesses and employment.

The economic stress caused by a global pandemic, on top of the dual realities of an aging population and a slow-growing population, make immigration more important than ever. It is also an opportune time for Canada to revive the investor immigrant program that was terminated in 2014, with a view to integrating it into our long-term economic strategy.

The federal government has clearly flagged that expediting immigration to Canada is a priority over the next several years.

In addition to setting a target to welcome 401,000 permanent residents in 2021, Ottawa recently made it easier for Hong Kong students and youth to quickly come to Canada on work and study permits, as well as offering new ways to stay permanently. The new permanent residence rules will also benefit people from Hong Kong already in Canada under existing work and study permits.

Then there’s the 300,000 Canadian citizens living in Hong Kong, many of whom, in light of recent political developments there, may be contemplating a return.

Also consider that although many applications were delayed by COVID-19, most are already well down the approval pipe and will proceed quickly once embassies and visa agencies fully reopen. Ottawa has already flagged that it will work to fast-track increased admission to Canada in 2021.

For all of that, there is much more that can be done for both prospective immigrants and Canada. At the top of that list is a practical reassessment of the investor immigrant class.

In 2020, the practical benefits of reviving the program far outweigh any misplaced concern about those “buying” Canadian citizenship.

Let’s not be hypocritical: Those of us already fortunate enough to live here stand to benefit as much as anyone who is new to the country.

The key to making it work this time around is to be clear-eyed about past failures, to refine the tax structure and better manage the five-year deposits required by these immigrant investors. It does not seem excessive to increase the $800,000 fee that was required before the Harper government cancelled the program. But in the past, those deposits were directed to provinces to foster the growth of small and medium-sized enterprises – a well-intentioned initiative that never took shape.

By learning from that disappointing experience, Canada can win on several counts.

It can seize opportunity to create a COVID-19 fund to help offset the economic cost of the coronavirus and attract immigrants who have the means to make a big difference in short order.

It can also attract a group of educated and financially secure immigrants who, along with their families, will make a lasting contribution to our economy. It is also an opportunity to bring regional and local governments into the process to ensure the funds are put to the best use.

Nowhere would that difference be felt more immediately than in the stabilization of the domestic residential real estate market, small business and employment, something of great importance to all Canadians and their families.

For some time now, there have been claims that housing markets, especially condominiums in urban centres, are threatened by an imbalance of supply and demand.

That’s a tough prospect for municipalities and provinces that have already been economically ravaged by the effect of the coronavirus.

Higher immigration levels – especially in the economic class – address this on a number of levels.

Furthermore, while much has been made of the pandemic-driven urban exodus, new Canadians tend to gravitate to and revitalize our cities.

Immigration is an important way for Canada to build long-term economic, social and cultural bridges around the world. Does anyone think it will be anything but beneficial to our relations with Washington that vice-president-elect Kamala Harris had such a positive experience as a student in Montreal?

We have always been justifiably proud of being a country of immigrants. Clearing the 2020 backlog, expediting new permanent residency applications and reinstating the investor immigrant class is both timely and strategic at a time when we need to reinforce our country as seldom before, and to ensure the long-term prosperity of all Canadians.

Green is a Managing Partner at Green and Spiegel and past chair of the Canadian Bar Association, National Section, Citizenship and Immigration

Source: https://www.theglobeandmail.com/business/commentary/article-canada-should-revive-the-investor-immigrant-program-and-fix-its-past/

Apex Capital Partners Launches Discounted Citizenship by Investment Program for Concerned Citizens Following Flood of Inquiries from Conservative Americans Looking to Relocate Abroad After Biden’s Presidential Victory

Almost funny but reflects a certain mindset (don’t recall any similar pitches from citizenship-by-investment firms targeted at Democrats following Trump’s election (the Cape Breton site encouraging Americans was more a welcome site):

 Apex Capital Partners, a boutique financial advisory firm specializing in advising international individuals and governments on Citizenship by Investment Programs (CIPs), today announced the availability of its “American Second Passport Program,” a new option intended for US citizens who are concerned with the country’s direction under President-Elect Joe Biden, and are now serious about moving abroad. Ultimately, CIPs provide individuals and their families with the legal means for acquiring second citizenships, passports and permanent residency in other countries, often in the Caribbean or Europe.

Apex Capital Partners typically receives approximately five inquiries from American citizens per year but is now hearing from numerous concerned citizens on a daily basis, experiencing a 650% increase in interest since the November 3rd election alone, when compared to 2019. This comes as no surprise, as leading up to the election the team has been inundated with requests from high net worth individuals, particularly conservatives, seeking to relocate abroad should now President-Elect Biden emerge victorious. Now, the Company is offering 35% off its American Second Passport Program until January 20, 2020 – Inauguration Day.

Many Americans are now very concerned about proposed significant increases to their income tax payments, as well as continued social unrest. Further, this year’s “American nightmare” fueled by COVID-19 has resulted in very restricted travel for Americans, limiting recreational or business trips for anyone possessing just a US passport. For these reasons, citizenship by investment in other parts of the world is widely considered a safe, financially secure passport diversification option.

Americans concerned by a Biden administration are turning to Apex Capital Partners, a leading, internationally recognized Company that works directly with both international governments and those pursuing citizenship abroad to implement strategies needed to acquire foreign citizenships. These alternative citizenship opportunities are made possible through CIPs, a legal transaction in the form of a real estate or infrastructure investment in exchange for citizenship, in countries such as the Caribbean and Europe – with popular examples such as St. Kitts and Nevis, Saint Lucia, Dominica, Grenada and Montenegro.

“CIPs are especially valuable now for three key reasons. One, with an alternative to a US passport, travelers and business executives can bypass the current travel COVID 19 restrictions in place. Two, people can reside in a safe, unthreatened place amid shaky US social and political conditions that they perceive are dangerous. Lastly and right now the most popular reason, is that citizenship abroad enables for more financial security and often reduced taxes – a concern felt by many conservatives and HNWI,” said Nuri Katz, Founder of Apex Capital Partners.

Interest to leave the country after Biden’s victory has also been expressed publicly to the nation by none other than President Trump himself, who recently suggested “maybe I’ll have to leave the country.” Prior to the outcome of the 2016 Election, many liberal individuals and families across the country threatened to leave if Trump was elected. Some people left, while many more turned to social media to state their displeasure with Trump’s administration. Four years later, the same trend came during the first 2020 presidential debate, when Google searches for “move to Canada” greatly spiked.

“Talk about leaving the country after an election outcome is certainly not new, but we’re now seeing it become a reality after such a difficult year. In 2017, around 5,000 people internationally obtained CIPs, but this year I estimate it to be 25,000,” said Katz. “Despite all the potential and personal reasons for wanting to leave the United States, it is still a very difficult decision and should be conducted with an experienced team of migration advisors as well as tax and legal professionals. Using a network of legal advisors, our team informs investors on viable options to seek citizenship and evaluate all financial consequences. Throughout this process, we’re here to help answer any and all questions.”

About Apex Capital Partners

Apex Capital Partners is a full-service advisory firm specializing in investment consulting and wealth management for a multinational, high-net-worth clientele. APEX provides services with end-to-end execution in areas such as second citizenship and immigration, wealth and asset management, financial services, and international real estate sale and development.

For more than two decades, APEX consultants have guided affluent individuals and their families through the complexities of foreign investing, and of obtaining second citizenship and residency. The APEX team also advises governments in establishing Citizenship by Investment programs, and provides support services to financial institutions, law firms, and family offices representing the interests of high-net-worth investors. For those interested in pursuing a citizenship by investment opportunity, please contact Apex Capital Partners by visiting http://apexcapital.partners/

Source: Apex Capital Partners Launches Discounted Citizenship by Investment Program for Concerned Citizens Following Flood of Inquiries from Conservative Americans Looking to Relocate Abroad After Biden’s Presidential Victory

The scandal-hit market for passports and long-term visas is booming

From the Economist:

FOR THE industry’s critics, it is a scandal that exposes exactly what they have been warning about. Many people have an almost instinctive distaste for the business in selling long-term-residence rights in a country or even citizenship there for cash, usually in the form of an authorised investment. So a documentary this month on Al Jazeera, a Qatar-based television channel, seeming to uncover corruption in an “investment migration” scheme offered by Cyprus, did not not seem especially shocking. It showed Cypriot politicians filmed in a sting operation, apparently willing to sell their country’s passport to a (fictitious) Chinese businessman who, in the cover story, had been convicted to seven years in jail for money-laundering, and so should have been ineligible.

For the industry’s practitioners—the consultants, accountants, bankers, wealth managers, lawyers and government departments selling their country’s charms—this is a blow. Although the politicians involved have protested their innocence, Cyprus has suspended its “golden passport” scheme from November 1st. European Union officials in Brussels and members of the European Parliament were already hostile to such schemes. And in response to the latest scandal, the European Commission has begun legal action (“infringement procedures”) to investigate both Cyprus’s scheme and one offered by Malta. It is an extremely sensitive issue for the EU. On the one hand, no issue is more jealousy guarded as a “national” competence than whom a country allows to be a citizen. On the other hand, a passport from an EU member confers the right to live and work anywhere in the EU; and a “Schengen” visa allows free travel to 22 EU members and four other countries.

Source: The scandal-hit market for passports and long-term visas is booming

After outcry, Cyprus suspends its citizenship for cash programme

Good riddance:

Cyprus said it was suspending a controversial citizenship for investment programme on Tuesday following reports of abuses of a system that gives the rich a passport and visa-free travel throughout the EU.

Criticism of the programme reached a head after the Al Jazeera network secretly filmed a state official, a lawmaker and a lawyer apparently attempting to help an imaginary Chinese investor – with a criminal record – get a passport.

A criminal record should disqualify a candidate.

Several news outlets, including Reuters, have carried reports in the past two years on a scheme where thousands of foreign investors with deep pockets have leapfrogged over normally arduous citizenship processes, including for persons born on the island.

Parliamentary speaker Demetris Syllouris, seen in the video apparently offering to use his influence in getting the investor a passport – and suggesting alternatives if that failed – said he would be standing down from his duties from Oct. 19.

Syllouris, 67, is the second highest-ranking state official in Cyprus after President Nicos Anastasiades. He said he would withdraw until an investigation was complete.

“I would like to publicly apologise for this unpleasant image conveyed to the Cypriot public… And any upset it may have caused,” he said in a statement.

Syllouris has previously said he suspected something was amiss with the imaginary investor but was fishing for information. He said the reports were “staged” and out of context.

The suspension of the programme, in its current form, would take effect from Nov. 1, government spokesman Kyriakos Koushos told journalists after an emergency session of the island’s cabinet.

For a minimum investment of 2 million euros, the scheme would guarantee visa-free travel in the European Union, which Cyprus joined in 2004.

Criticised as opaque and fraught with the risk of money-laundering, the scheme is popular with Russians, Ukrainians and, more recently, Chinese and Cambodians.

The persons filmed in the documentary claimed entrapment and said they had reported the matter to authorities months ago.

Reuters reported in October 2019 that Cambodians close to long-time leader Hun Sen, plus family members, had acquired passports, leading authorities to review the programme.

Another report by Al Jazeera in August this year said at least 60 individuals who acquired citizenship between 2017 and 2019 were high risk, and would probably not have qualified with new tighter rules since introduced.

At the time, authorities dismissed that report as “propaganda”, focussing instead on trying to find the whistleblower.

Rich families buy second citizenship in post-Ritz Saudi Arabia

Of interest:

“I have clients who escaped the Ritz-Carlton event because they were prudent enough to secure second citizenship beforehand. … The moment you hire me you are admitting to yourself that there is a danger,” David Lesperance, a Canadian lawyer who has advised dozens of affluent Gulf families since the early 1990s, told Al-Monitor.

In November 2017, 381 prominent Saudi businessmen, royals and officials were caught up in the “anti-corruption” crackdown led by Crown Prince Mohammad bin Salman.

Saudi authorities reportedly pressured a quarter of Ritz-Carlton detainees, including through physical abuse, to hand over to the state assets worth a total of over $106 billion.

Ryan Bohl is a Middle East analyst at the US-based geopolitical-­risk firm Stratfor. He told Al-Monitor anti-corruption campaigns led by Gulf Cooperation Council (GCC) countries are now “used to seize assets of those the state sees as disloyal.”

In this context, the global trade of second citizenship — often associated with tax evasion, money laundering and corruption — is viewed by some Gulf nationals who are exposed to risks related to political oppression and regime change as a strategic way out.

Cyprus and the bin Laden family

Preferred destinations are publicly known — Cyprus, Ireland, Turkey, the United Kingdom, the United States, Canada and the Caribbean islands, among others — but firms operating in this secretive industry do not disclose how many Gulf nationals bought second citizenship.

Internal documents leaked to the Qatari broadcaster Al Jazeera earlier this year revealed, however, the extent of Cyprus’ citizenship by investment program: about 2,500 individuals from 74 countries bought a Cypriot passport between 2017 and 2019.

Although Russian, Chinese and Ukrainian citizens account for the vast majority of names listed in the Cyprus Papers, applications from Saudi Arabia have “increased since the rise of Crown Prince Mohammad bin Salman,” Al Jazeera’s investigation reads.

In 2019, Cyprus granted citizenship to the relative of a Saudi national detained at the Ritz-Carlton and to a member of the bin Laden family — once one of the most influential in the kingdom. During the crackdown, three bin Laden brothers were detained and the family’s conglomerate effectively taken over by the state.

According to The Independent, some wealthy Saudis moved assets “out of the region” in the days following the Ritz-Carlton arrests, and Capital Economics’ senior emerging markets economist Jason Tuvey noted “a jump in Saudi residents placing banking deposits abroad.”

GCC states either prohibit dual citizenship or condition it on government approval but are not actively cracking down on second citizenships, Bohl believes. “They are, however, trying to find ways to ensure that such secondary passports do not become shields by which dissidents can attack their policies with impunity,” the analyst said.

Saudi operatives abducted three princes living in Europe between 2015 and 2017 and a year later a hit squad killed and dismembered Saudi journalist and Washington Post contributor Jamal Khashoggi, who was a US resident with three children who are US citizens.

“It is beyond having a second nationality,” said Ziad Karkaji, managing partner of a Beirut-based firm specialized in residency and citizenship programs. Speaking about Al-Waleed bin Talal, a high-profile Saudi investor who holds a Lebanese passport, Karkaji told Al-Monitor, “With all his power and connections, he still stayed in the Ritz-Carlton.”

In September 2020, a group of Saudi dissidents, most of them in exile, crossed a red line by announcing the formation of a pro-democracy political party to call for peaceful change and combat what they referred to as state “violence and repression.”

“Every society is three meals away from chaos”

Beyond political considerations, getting second citizenship is “a long-standing practice” for Gulf businessmen and investors who travel frequently and want to avoid visa processing time, Bohl recalled. According to The Henley Passport Index, a power ranking of passports, the Cypriot travel document is twice as powerful as the Saudi.

Given the complexity of navigating national and international legislation, high-end intermediaries such as private bankers and family offices often recommend wealthy individuals seeking second citizenship to hire an expert. Some jurisdictions, like Malta, publish the names of foreigners who have acquired citizenship in the island state.

Applications for second passports from GCC nationals also soared about a decade ago during the Arab Spring. Some senior officials and members of royal families fear social discontent could lead to shifts in power and their assets being frozen.

As the global economy is expected to gradually shift away from carbon-intensive energies, the ruling families in the Arab Gulf states face unprecedented economic and sociopolitical challenges to reinvent their oil-dependent model of governance. Experts warn the change could cause political instability and eventually increase demand for second citizenship.

“Well, as Lenin said, ‘Every society is three meals away from chaos.’” Things happened, you know; in Tunisia it started with a fruit seller,” Lesperance commented.

Source: Rich families buy second citizenship in post-Ritz Saudi Arabia