Interesting profile of Canadian immigration lawyer David Lesperance who specializes in business immigration.Remain unconvinced that governments can design investor immigration or citizenship programs for the ultra-rich that provide meaningful benefits to Canada and Canadians as both the previous federal program, Quebec’s current program and programs of other countries largely demonstrate:
When a Chinese-Canadian billionaire faced a closed-door trial last month, four years after being snatched from Hong Kong, the event did not go unnoticed among China’s wealthy entrepreneurs.It was the latest sign that they could be next as Beijing pushes down on the country’s most affluent business people, says a Canadian lawyer whose unique practice focuses on building back-up plans for “ultra-high-net-worth” individuals.
That nervousness is fueling a growing and urgent interest in leaving mainland China or Hong Kong, says David Lesperance.
The number of very-rich business people based in the region contacting him for help in getting out has tripled in the last couple of years, he says, as President Xi Jinping consolidates power, eliminates opponents and tightens his grip on once-free-wheeling Hong Kong.
And they tend to be wealthier, often worth billions, people who had been entrenched where they were until recently.
“These are clients who realize the chances of getting caught have increased dramatically — to not a will but a when question,” said Lesperance. “That group has now for the first time really contemplated ‘I’m going to have to leave some day. There is definitely a wildfire.’”
“We’ve been very busy since the beginning of the year.”
The resulting flight of “golden geese” could be an economic boon for the countries where they land. Canada is definitely among the mix of possible destinations but governments here should do more to attract the rich fleeing China — and their fortunes, said the lawyer
But luring such migrants is not without controversy. Ottawa’s investor immigrant program was actually cancelled in 2014 because of what the then-Conservative government said were an array of problems. Those immigrants had to fork out a relatively tiny investment, paid less taxes here, on average, than nannies, spent little time in Canada, and often learned neither English or French, critics said.
So far, China has not seen a major exodus of its richest citizens. It’s still home to 626 billionaires, second only to the United States’ 724, according to Forbes.
But Lesperance is not the only advisor noticing a growing trend among China’s wealthy to move at least their money out of the country.
Increasing numbers are parking assets in Singapore via the city state’s “family office” system, according to a survey in March by CNBC. Jenga, one of the firms that handles such transfers, told the news outlet it had seen demand double in just the previous 12 months.
Lesperance seems to come by the work honestly, having been raised in an almost borderless environment himself. A native of Windsor, Ont., his father worked in the auto industry across the river in Detroit and two of his siblings were born in a hospital there, giving them instant dual citizenship
He says his practice — which combines immigration and taxation advice — is divided about equally between clients in China/Hong Kong, the Middle East and the United States. He’s now based in Poland, where he can fit clients from multiple time zones into his daily schedule.
Many of Saudi Arabia’s wealthy are worried about Crown Prince Mohammed bin Salman rising to the throne when his father, the king, dies. In the U.S., clients looking to decamp are divided between those who fear Democrats will boost taxes on the wealthy, and others who worry about a sharp shift to the right if the Republicans regain power nationally.
But the case of China highlights the dramatic changes Xi has wrought since coming to power in 2012, and the shifting role of business tycoons in the nominally Communist country.
Anxieties began with the 2019 proposal of an extradition treaty from Hong Kong to China, said Lesperance. It has increased as Beijing tightened the screws on Hong Kong, introducing a widely criticized National Security Law, imprisoning dissidents including media mogul Jimmy Lai and curbing the limited amount of democracy in the city’s government.
And there have been further scares on the mainland. Beijing recently quashed the thriving private-education industry and applied new pressure on the high-tech sector. Jack Ma, billionaire head of the Alibaba technology conglomerate, disappeared for months in 2020 and 2021 after he publicly criticized Chinese regulators, as an IPO for his Ant Group was suddenly axed.
Other moguls have also disappeared mysteriously. Xi’s announcement of a “common prosperity” program to more evenly spread wealth across the Chinese population has further put the very rich under pressure. Many China experts speculate that such campaigns are also about eliminating rivals to the Party’s — and Xi’s — power and control.
And then there is Xiao Jianhua, the Chinese born-and-bred Canadian citizen who was taken from his home in a Hong Kong hotel in 2017, surfacing just recently for a hasty, secretly held trial in China on unclear charges. His family in Toronto is still waiting to hear the verdict.
The case is “often cited” by clients who fear they could similarly run afoul of the government, said Lesperance. His bottom-line advice is that they prepare in advance for just that happening, rather than wait and see if things turn bad.
“You want to prevent the problem and avoid the wildfire, as opposed to trying to put it out after your house is on fire.”
Lesperance tells clients they must focus on moving both “ass and assets” — finding a place for their money and themselves and their family. That means deciding on a new home that works both “at the board table and the breakfast table,” somewhere the children can get a good education and the entrepreneur can keep running his or her business.
Popular destinations include Australia, New Zealand, the U.K., the U.S. and this country.
To get into Canada, those wealthy migrants can set up a subsidiary of their business here and obtain work permits as corporate transfers. Provincial “nominee” programs provide a pathway to permanent residence but they’re a “dog’s breakfast,” said Lesperance.
He recommends Ottawa revive the investor immigrant class, with reforms to address past issues. That could include requiring the person to provide a clear financial benefit to Canada, a system to weed out money launderers and other “undesirables,” strict application of tax laws, and imposing a large fee to cover the cost of processing those and other applications, the lawyer said. With all of it done in a clear, timely way.
“The thing to remember is that Canada is in competition for these Golden Geese and must present an opportunity which is competitive with all the other countries which are also trying to get this group.”
Previously unreleased internal communications indicate the Trump administration tried to add a citizenship question to the census with the goal of affecting congressional apportionment, according to a report issued Wednesday by the House Committee on Oversight and Reform.
The documents appear to contradict statements made under oath by then-Secretary of Commerce Wilbur Ross, who told the committee that the push for a citizenship question was unrelated to apportionment and the reason for adding it was to help enforce the Voting Rights Act.
The nearly 500 documents include several drafts of an August 2017 memorandum prepared by a Commerce Department lawyer and political appointee, James Uthmeier, in which he initially warned that using a citizenship question for apportionment would probably be illegal and violate the constitution, the report said.
In later drafts, Uthmeier and another political appointee, Earl Comstock, revised the draft to say there was “nothing illegal or unconstitutional about adding a citizenship question” and claiming the Founding Fathers “intended the apportionment count to be based on legal inhabitants,” the report said. In December 2017, the Justice Department sent a formal request to the Commerce Department, which oversees the Census Bureau, asking it to add the question; in March 2018, Ross announced it would be added to the 2020 Census.
“Today’s Committee memo pulls back the curtain on this shameful conduct and shows clearly how the Trump Administration secretly tried to manipulate the census for political gain while lying to the public and Congress about their goals,” Oversight Committee Chairwoman Carolyn B. Maloney (D-N.Y.) said in a statement.
The administration’s effort to add the question lasted two years. It was challenged by civil rights groups who blasted it as an effort to undercount Latinos and scare immigrant communities from participating in a survey that determines congressional apportionment and redistricting, as well as the disbursement of $1.5 trillion in federal funds annually.
The new evidence echoes documents that surfaced during litigation over the question, including a study by a Republican operative that found adding a citizenship question would benefit Republicans in redistricting.
“It was obvious it was just a farce,” said former Census Bureau director John Thompson, who testified at the time, saying the bureau under Ross had not done proper testing of the citizenship question before adding it. “I’m glad the committee got the materials to reinforce that, but it was not surprising.”
Thomas Wolf, deputy director of the Democracy Program at NYU’s Brennan Center for Justice, said, “Lest anyone doubted that what the Trump administration was up to was wrong, these documents show that even the Trump administration itself knew that what it was doing was illegal.”
The Supreme Court ruled in 2019 that the administration’s stated rationale for adding the question was “contrived,” and the administration dropped the effort. It then said it would instead block undocumented immigrants from being counted for apportionment, setting off another volley of court battles that lasted until the waning days of Donald Trump’s presidency.
That attempt ultimately failed when, because of pandemic-related delays, the Census Bureau was unable to deliver state population totals to the president before he left office. The administration was also unable to explain how it planned to identify and count undocumented immigrants, for whom there is no official tally.
The documents obtained by the committee had been withheld by the Trump administration despite subpoenas, the report said, adding that the committee had faced “unprecedented obstruction” from administration officials. Ross and then-Attorney General William P. Barr were held in contempt of Congress after refusing to produce them, the report noted, adding that the previously withheld or redacted documents were finally released “after more than two years of litigation, and the arrival of a new administration.”
Maloney introduced a bill last week that she said is designed to protect the Census Bureau against future attempts to politicize it. H.R. 8326, the Ensuring a Fair and Accurate Census Act, would prevent the removal of a Census Bureau director without just cause,limit the number of political appointees at the bureau and prohibit the secretary of commerce from adding topics or questions to the survey “unless he or she followed the existing statutory requirements to notify Congress in advance.” Itwouldalso bar new questions from appearing on the decennial census form unless they have been “researched, tested, certified by the Secretary, and evaluated by the Government Accountability Office.”
Thompson praised the bill. “I think it would protect the independence of the Census Bureau,” he said. “I’m very enthusiastic about the bill. … I hope it gets enacted.”
But even if it is, it might not fully insulate the bureau from partisan interference, he said. Under a Republican House and Senate, “the Congress could direct the Census Bureau to collect citizenship [information] on the census, and then there could be a fight to get the citizenship question on the 2030 Census,” he said, adding, “Congress could try to pass a law saying you need to do apportionment by citizenship.”
The bar for passing a constitutional amendment would be high, Wolf said. However, the Trump administration’s effort to add the citizenship question and exclude undocumented people from apportionment “indicates that the 2020 Census was in grave peril and we escaped only through a combination of significant legal victories and a certain amount of luck,” he said. “The census is clearly too fragile to continue in its imperiled state.”
Along with limiting political appointees and giving additional powers to the Census Bureau director, as Maloney’s bill proposes, Wolf suggested curtailing the president’s ability to influence apportionment, as Trump proposed to do. By law, reapportionment of the 435 House seats is supposed to happen automatically based on state population totals.
“The president’s role in the apportionment process was supposed to be administerial,” Wolf said. “That’s why it’s called automatic apportionment.”
As always, canadavisa.com provides a valuable service sharing the detailed numbers one backlogs (it appears I was too charitable with respect to citizenship in my May update):
Canada continues to struggle with its immigration applications as its inventory now stands at some 2.7 million people.
This represents a growth of nearly 300,000 people over the past six weeks.
The backlog has nearly doubled over the past year and nearly tripled since the start of the pandemic.
Express Entry draws resume due to backlog reduction
A total of 51,616 Express Entry applicants are waiting on decisions as of July 17, a significant reduction from the 88,903 reported when comparable was available on March 15.
The reduction in Express Entry backlogs means IRCC can once again hold all program draws, and processing times for new Express Entry applicants are back to the six-month standard. On July 6, IRCC held its first all-program draw since December 2020.
Family class inventory is up slightly
The overall inventory of family class applicants is up to 118,251 persons compared to 112,837 persons on June 6.
The Spouses, Partners and Children Program inventory has increased compared to early June. It stands at 68,159 persons compared to 67,929 persons last month. The figure for July was found by adding Spouses and Partners to Children and Other Family Class for the purpose of comparison.
The Parents and Grandparents Program (PGP) has seen another increase. It is now at 47,025 persons compared to 41,802 persons. IRCC has yet to announce details on its plans for the PGP 2022.
The growth of IRCC’s backlog is normal to an extent over the summer months. More people look to obtain temporary resident visas to visit family and friends during the warmest time of the year in Canada.
In addition, many international students who complete their studies in the spring go on to apply for Post-Graduation Work Permits (PGWP), which is Canada’s largest work permit category.
Most international students also submit their study permit applications in the months leading up to the start of Canada’s academic calendar. This results in Canada usually welcoming over 200,000 new international students leading into September each year.
The main exception is the Canada-Ukraine Authorization for Emergency Travel(CUAET), which Canada introduced in March to provide Ukrainians with the opportunity to relocate following Russia’s invasion. Since March 17, IRCC has received 362,664 CUAET applications, causing its backlog to swell.
However, the overall growth of the backlog, a nearly three-fold increase since the start of the pandemic in March 2020, highlights ongoing challenges with Canada’s immigration system. It is a function of IRCC continuing to welcome new applications throughout the pandemic even though its processing capacity was limited for large stretches of 2020 and 2021.
The department is now playing catch-up and is taking steps such as hiring additional processing staff and looking to invest in technological upgrades.
Meanwhile, other arms of the federal government have taken notice of Canada’s immigration application challenges.
In May, the Canadian Parliament’s Standing Committee on Citizenship and Immigration (CIMM) began a study on the backlogs. It will result in a public study containing recommendations for improvement.
In June, Prime Minister Justin Trudeau created a federal task force to address backlog challenges. It is made up of a group of federal ministers, who will make recommendations to address issues that are causing the delay in application processing. The goal is to create both long-term and short-term solutions that will clear the backlogs and improve the quality and speed of services.
Inventory in tables
The following tables show more details on IRCC’s inventory.
Citizenship Inventory
Application type
Persons as of July 15, 2022
Grant
387,368
Proof
57,424
Total Citizenship Inventory
444,792
Immigration Inventory
Immigration Category
Persons as of July 17
Economic Class
211,903
Family Class
118,251
Humanitarian & Compassionate / Public Policy
29,848
Permit Holders Class
16
Protected Persons
154,098
Total Immigration Inventory
514,116
Express Entry Inventory
Immigration Category
Persons as of July 17
Canadian Experience Class (EE)
5,195
Federal Skilled Workers (EE)
18,127
Skilled Trades (EE)
369
Provincial/Territorial Nominees (EE)
27,925
Total Immigration Inventory
51,616
Family Class Inventory
Immigration Category
Persons as of July 17, 2022
Children & Other Family Class
9,147
FCH-Family relations – H&C
3,067
Parents and Grandparents
47,025
Spouses & Partners
59,012
Total Family Class Inventory
118,251
Economic Class Inventory
Immigration category
Persons as of July 17, 2022
Agri-Food Pilot Program
765
Atlantic Immigration Pilot Programs
2,380
Atlantic Immigration Program
33
Canadian Experience Class (EE)
5,195
Canadian Experience Class (No EE)
109
Caring for Children
60
Federal Entrepreneur
4
Federal Self Employed
4,502
Federal Skilled Workers (C-50)
123
Federal Skilled Workers (EE)
18,127
Federal Skilled Workers (Pre C-50)
23
High Medical Needs
7
Home Child Care Pilot
18,191
Home Support Worker Pilot
6,912
Interim Pathway Measure
767
Live-in Caregiver
931
Provincial/Territorial Nominees (EE)
27,925
Provincial/Territorial Nominees (No EE)
35,599
Quebec Entrepreneur
281
Quebec Investor
11,115
Quebec Self Employed
94
Quebec Skilled Workers
24,570
Rural and Northern Immigration Pilot
1,118
Skilled Trades (EE)
369
Skilled Trades (No EE)
2
Start-up Business
1,309
TR to PR
51,392
Total Economic Class Inventory
211,903
Humanitarian and Compassionate Inventory
Immigration Category
Persons as of July 17, 2022
HC & PH class-ADM Dependant Person Overseas
44
Humanitarian & Compassionate Straight
3,067
Humanitarian & Compassionate with Risk or Discrimination
Higher threshold than most, along with focus on active not passive investment:
To attract experienced, high-value investors to invest in domestic businesses, the New Zealand government has created a new investor migrant visa category. The new Active Investor Plus visa category will replace the existing Investor 1 and Investor 2 visa categories. Eligibility criteria for New Zealand’s Active Investor Plus visa category includes a minimum $5 million investment and only 50% of that can be invested in listed equities.
“We have so many fantastic businesses in New Zealand that are making a real name for themselves in the global marketplace. Our Government has a goal to support these businesses to grow into even more successful global brands, and updating our investor visa settings is a key part of our strategy to attract high-value investors,” Economic and Regional Development Minister Stuart Nash said.
The new Active Investor Plus visa will open on 19 September 2022. Applications under the Investor 1 and Investor 2 visas will no longer be accepted after 27 July 2022. The government said said that all applications in the current pipeline will continue to be processed by Immigration New Zealand.
The new Active Investor Plus visa will replace the old investment visa categories and would require migrants to make investments in New Zealand businesses, the minister said.
He said that the new visa regime is meant to attract more active investors who can deliver real benefits to the New Zealand economy over a long period of time.
“The new Active Investor Plus visa will replace the old investment visa categories, which although successful in attracting a large amount of funds over past decade – over $12b –often resulted in passive investment in shares and bonds rather than directly into New Zealand companies,” he said.
“Applicants who make acceptable direct investments, among other requirements, will be eligible for the new visa with a $5 million minimum investment and receive the highest rating which is a lower minimum amount than those who choose more indirect investments. The minimum amount required for indirect investments will be $15 million,” he added.
Always interesting to see where the money is going. Canada is on the list for the start-up visa program, which is distinct from most of the other programs listed in terms of being based more on actual investment than just residence (but look forward to an eventual IRCC evaluation to see how effective it is):
“A tsunami of private capital has left Russia and Ukraine, the UK has lost its wealth hub crown, and the US is fading fast as a magnet for the world’s wealthy, with the UAE expected to overtake it by attracting the largest net inflows of millionaires globally in 2022, according to the latest Henley Global Citizens Report, which tracks private wealth and investment migration trends worldwide.
The Q2 report released today by international residence and citizenship by investment advisory firm Henley & Partners exclusively features the latest projected 2022 net inflows and outflows of US dollar millionaires (namely, the difference between the number of HNWIs who relocate to and the number who emigrate from a country) forecast by New World Wealth. The firm is the only known independent wealth research company systematically tracking international private wealth migration trends over the past decade. The HNWI migration figures focus only on people with wealth of USD 1 million or more and who have truly moved — namely, those who stay in their new country more than half of the year.
As expected, Russia has suffered the biggest emigration of millionaires over the past six months, with forecast net outflows of 15,000 by the end of 2022 — a massive 15% of its HNWI population and 9,500 more than in 2019, pre-pandemic. Russia’s invasion is in turn driving a steep spike in outgoing HNWIs from Ukraine, which is predicted to suffer its highest net loss in the country’s history — 2,800 millionaires (42% of its HNWI population) and a net loss of 2,400 more than 2019. No country-specific figures are available for 2020 and 2021 owing to Covid-related lockdowns and travel restrictions.
Top 10 countries gaining and losing millionaires in 2022
Forecast figures in the Henley Global Citizens Report show the top 10 countries in terms of net inflows of HNWIs in 2022 will be the UAE, Australia, Singapore, Israel, Switzerland, the US, Portugal, Greece, Canada, and New Zealand. Large numbers of millionaires are also expected to move to ‘the three Ms’: Malta, Mauritius, and Monaco. On the flip side, the 10 countries where the highest net outflows of HNWIs are predicted are Russia, China, India, Hong Kong, Ukraine, Brazil, the UK, Mexico, Saudi Arabia, and Indonesia.
Dr. Juerg Steffen, CEO of Henley & Partners, says HNWI migration was a rising trend over the past decade until, understandably, it dipped in 2020 and 2021 due to the Covid-19 pandemic. ‘The 2022 forecast reflects an extremely volatile environment worldwide. By the end of the year, 88,000 millionaires are expected to have relocated to new countries, 22,000 fewer than in 2019 when 110,000 moved. Next year, the largest millionaire migration flows on record are predicted — 125,000 — as affluent investors and their families earnestly prepare for the new post-Covid world, with an as yet-to-be revealed rearrangement of the global order, and the ever-present threat of climate change as a constant backdrop.’
Andrew Amoils, Head of Research at New World Wealth says HNWI migration figures are an excellent barometer for the health of an economy. ‘Affluent individuals are extremely mobile, and their movements can provide an early warning signal into future country trends. Countries that draw wealthy individuals and families to migrate to their shores tend to be robust, with low crime rates, competitive tax rates, and attractive business opportunities.’
UK and USA – the mighty are falling
According to the latest data, destinations that traditionally attracted wealthy investors are losing their luster. The UK, once touted as the world’s financial center, continues to see a steady loss of millionaires, with net outflows of 1,500 predicted for 2022. This trend began five years ago when the Brexit vote and rising taxes saw more HNWIs leaving the country than entering for the first time. The UK has suffered a total net loss of approximately 12,000 millionaires since 2017.
The appeal of another financial giant, the US, is also dwindling fast. America is notably less popular among migrating millionaires today than pre-Covid, perhaps owing in part to the threat of higher taxes. The country still attracts more HNWIs than it loses to emigration, with a net inflow of 1,500 projected for 2022, although this is a staggering 86% drop from 2019 levels, which saw a net inflow of 10,800 millionaires.
Commenting on the geopolitics of millionaire migration in the Henley Global Citizens Report, award-winning journalist Misha Glenny says private wealth growth is bound to remain anemic in the US this year as political unpredictability looms. ‘In November, the mid-term elections are likely to return a Republican House and possibly the Senate, too. With culture wars between Democrats and Republicans mounting once more with the leaked decision of the Supreme Court to overturn the Roe vs. Wade ruling on abortions, some fear we are entering another period of dramatic instability such as that which characterized the Trump years. As a consequence, some high-net-worth investors will doubtless think twice before committing their wealth to the Americas.’
The UAE’s stellar ascent as a wealth hub
By contrast, the UAE has become the focus of intense interest among affluent investors and is expected to see the highest net influx of HNWIs globally in 2022, with 4,000 forecast — a dramatic increase of 208% versus 2019’s net inflow of 1,300 and one of its largest on record. This mirrors the country’s remarkable rise in the Henley Passport Index rankings over the past decade as it focused on attracting tourism and trade by implementing a succession of mutually reciprocated visa waivers. The UAE is now doing the same with its competitive, agile approach to adapting immigration regulations to attract private wealth, capital, and talent.
Glenny says affluent Russians seeking to escape the impact of the devastating Western sanctions on their country have started to move to the UAE and Israel in large numbers. ‘An underlying pattern was already detectable in advance of the invasion of Ukraine. Well before the imposition of sanctions on the Russian banking system, there was a tsunami of capital leaving the country, largely prompted by the increasingly capricious governing style of President Vladimir Putin and his demands of loyalty made on middle-class and wealthy Russians. They have now come under further pressure from many Western countries, such as Britain, where they had previously made their homes.’
Israel, Australia, New Zealand, Singapore among the big winners
As Glenny points out, net HNWI inflows are on the rise in Israel, with a figure of 2,500 forecast for 2022 — a significant increase of 79% since 2019.
Long-term high performer Australia consistently attracts large numbers of HNWIs. New World Wealth estimates that over 80,000 US dollar millionaires have moved to the country over the past 20 years. In 2022, the net inflow is expected to be 3,500 — the second-highest globally. Neighboring New Zealand is expected to receive a net inflow of 800 HNWIs in 2022, and Asia’s prime hub of affluence, Singapore, continues to attract millionaires, with net inflows of 2,800 expected — a prolific 87% increase compared to 2019’s figure of 1,500.
Commenting in the Henley Global Citizens Report, FutureMap founder and international bestselling author Dr. Parag Khanna says, ‘Globalization is not dead — and certainly not from the perspective of Asia, where inward capital flows are rising on the back of a post-Covid reopening and genuine investments across the region in productive capacity. With multiple factory floors, multi-trillion-dollar economies, rapid urbanization, a rising middle class, and surging technological penetration, Asia’s continued ascent remains the major economic story of our age.’
China, Hong Kong (SAR China), India, Brazil among the biggest losers
Wealth emigration is beginning to hurt in China, with net outflows of 10,000 HNWIs expected in 2022. Amoils says, ‘General wealth growth in the country has been slowing over the past few years. As such, recent outflows of HNWIs may be more damaging than in the past. China’s deteriorating relationships with Australia and the US are also a major long-term concern.’
In Hong Kong (SAR China) HNWI departures continue albeit at a slower pace, with projected net millionaire outflows of 3,000 in 2022 (a 29% drop compared to 2019). Brazil’s millionaire exodus is intensifying with net outflows of 2,500 HNWIs predicted — up 79% compared to 2019. India is expected to suffer a net loss of approximately 8,000 HNWIs in 2022, up 14% since 2019 when the net loss was 7,000. However, India produces far more new millionaires than it loses to migration each year.
Commenting on wealth growth projections in the Henley Global Citizens Report, Prof. Trevor Williams, former Chief Economist at Lloyds Bank Commercial, says emerging economies are forecast to boom in the next decade. ‘As the world economy grows, economies in Africa, Latin America, and elsewhere in the Global South are catching up with high-income economies. And as this report shows, they will see a more significant number of millionaires and billionaires in the next decade. For example, the number of HNWIs in Sri Lanka is forecast to increase by 90% by 2031, while India and Mauritius’s millionaire growth is forecast at 80%, and China’s at 50%, compared to 20% in the USA and 10% in France, Germany, Italy, and the UK.’
Relentless uncertainty fuels demand for investment migration
Henley & Partners received the highest number of investment migration program enquiries on record in the first quarter of 2022 — an increase of 55% compared to the previous quarter, which was itself record-breaking. The top four nationalities currently driving demand are Russians, Indians, Americans, and Brits, and for the first time ever, Ukrainians are in the top 10 globally.
Dominic Volek, Group Head of Private Clients at Henley & Partners, says historically, many wealthy individuals acquired residence rights or citizenship without moving to those countries. ‘Recent turmoil is causing this to shift — more investors are considering relocating their families to other countries for a range of reasons, from safety and security, to education and healthcare, to climate resilience and even crypto-friendliness. It is important to note that nine of the top ten countries for forecast net HNWI inflows in 2022 host formal investment migration programs, which encourage foreign direct investment in return for the right to reside or citizenship. Investors can now see the value of diversifying their domicile portfolios as the ultimate hedge against both regional and global volatility.’
More on the citizenship petition and reaction, particularly touchy given Russian weaponization of citizenship and efforts to destroy Ukrainian identity and citizenship:
The document was registered on the presidential website on May 23 by Vitaliy Kapustyan, and so far it has already garnered over 25,000 signatures – the number required for a mandatory response from the head of state
The author of the petition demands the introduction of a comprehensive examination for obtaining citizenship in Ukraine. It should consist of a test on the Ukrainian language, the history of Ukraine, knowledge of the Constitution, and the national anthem.
It notes that the exam does not exempt candidates for citizenship from providing other necessary documents, but that the test should be an integral part of the process of acquiring citizenship.
“The Armed Forces of Ukraine, volunteers, and all concerned Ukrainians are doing everything possible to preserve the integrity of Ukraine,” the author of the petition stated in the explanatory note.
“Being Ukrainian is a privilege and at the same time a responsibility. In addition to the set of documents, candidates must show their respect and genuine interest in acquiring Ukrainian citizenship.”
In response to the petition, President Zelenskyy noted that one of the requirements for obtaining Ukrainian citizenship by foreigners is the level of command of the state language. This is determined by the National Commission on the Standards of the State Language, which sets the appropriate test.
At the same time, the requirements for obtaining citizenship do not include passing tests on the history of Ukraine and Ukrainian legislation.
“The issue of introducing a mandatory exam for acquiring Ukrainian citizenship will require legislative regulation,” the president said.
He explained that the government of Ukraine ensures the implementation of policy in the spheres of education and science, the comprehensive development and functioning of the state language in all spheres of public life throughout the territory of Ukraine, the implementation of state legal policy, and regulates migration processes.
“That’s why I ask Prime Minister of Ukraine Denys Shmyhal to look comprehensively into the issues raised in the electronic petition,” Zelenskyy said.
“The author of the electronic petition will be informed about the results of consideration of the issues raised.”
As scandal erupted in Ukraine on June 3, after adviser to the Minister of Internal Affairs Anton Gerashchenko announced that Russian journalist Aleksandr Nevzorov and his wife Lidia had received Ukrainian citizenship.
Public opinion was divided, with some criticizing the granting of citizenship. There are no other recent decrees on the granting of Ukrainian citizenship on the website of the President of Ukraine.
It is also not known whether Nevzorov took a test on the level of his proficiency in Ukrainian.
The Russian government updated the rules related to the Presidential Order that simplified the procedure for Ukrainian citizens seeking Russian citizenship. Now, children, spouses and parents of Ukrainian citizens are eligible for the relaxed process (previously only main applicants were eligible). Additionally, applicants now only need to show a migration card (or any other document confirming that the foreign citizen crossed the Russian border legally), whereas previously they had to prove residence in Russia, proof of income in Russia and knowledge of the Russian language. Lastly, foreign citizens without an address registered in Russia can file documents in any region where they reside in Russia.
Good detailed analysis of the numbers and the lack of accountability with respect to its delivery failures along with the application of exemptions from the fee-remission policy just implemented in 2021:
Ottawa has failed to issue passports within the required timeline to almost 300,000 Canadians in the first year of a new fee-remission policy brought in by immigration officials to ensure service standards are met.
According to the Service Fees Act, when an individual pays for a government service and there’s an unreasonable delay, the department involved must return a portion of the fee.
In April 2021, Immigration, Refugees and Citizenship Canada rolled out its remission policy for fees to apply to a program designed to attract foreign youth to travel and work in Canada; for the citizenship ceremony where someone takes the oath; and for passports.
Passport applicants, however, were not entitled to refunds this year due to the short nature of timelines and “exceptional circumstance” of the COVID-19 pandemic that officials say falls under a provision in the law enacted in 2017. Those circumstances are defined as situations outside the department’s control and include:
“Unforeseen” system disruptions;
Natural disasters;
Emergency situations that cause a closure of an office, a reduction in the service capacity or a surge of applications outside the department’s control;
Labour disruption.
Yet the number of people who would have qualified for fee remissions offers a glimpse at the extent of the delays at beleaguered passport services as Canadians look to travel extensively again.
Since the spring, Canadians have been camping outside Service Canada offices across the country to get new travel documents for planned trips as lives returned to normal for many, with border and public health restrictions relaxed.
“We know service delays, particularly in recent months, are unacceptable,” said Trudeau. “We will continue to do everything we can to improve the delivery of these services in an efficient and timely manner.
“This new task force will help guide the work of the government to better meet the changing needs of Canadians and continue to provide them with the high-quality services they need and deserve.”
According to data obtained by the Star, the immigration department, which oversees Passport Canada, failed to promptly deliver passports to a total of 295,789 Canadians in the year between April 2021 and 2022. Of those, 217,139 received their travel documents between one and 10 days late, while 78,650 got theirs 11 days or more past the standard times.
The passport service standard was set at 10 business days for in-person applications; 20 days by mail; end of next day for urgent service; and two to nine days for express service. Applicants who got their passport one to 10 days late would have been eligible for a 25 per cent refund, while those experiencing a delay of 11 days or more were supposed to get 50 per cent.
The number of passport applications that missed the target time surged from 1,648 in April 2021 to more than 23,000 last August to 55,117 in January, before falling to 40,343 this April.
The data provided by immigration officials did not break down further in terms of how an application was received. However, in the 2020-21 fiscal year, 81 per cent of all in-person passport applications were processed within 10 business days and 78 per cent of mail-in applications met the 20-day target.
A five-year adult passport application currently costs $120; a 10-year is $160. If all 300,000 applicants eligible for remissions were applying for a five-year adult passport, more than $11.2 million might have been returned for the substandard service.
Under the fee-remission policy, immigration applicants would be notified if their application was not processed within the established service standards and a refund would be issued based on the calculation method applicable for the fee paid.
Immigration department spokesperson Nancy Caron said this year’s remissions would have started by July 1, but have been postponed due to the pandemic, as the policy does not apply to applications processed in “unusual or exceptional circumstances” that may disrupt regular operations or result in “unforeseeable and significant influx of applications.”
“Remissions are not retroactive and applications received prior to the exceptional circumstances being lifted will not be eligible for remissions,” explained Caron, adding that exceptional circumstances are in effect for passport applicants with applications submitted between April 1, 2021, until at least Sept. 30.
For the International Experience Canada Program, which allows young people from other countries to travel and work in Canada, 766 applicants saw delays of one to 28 days beyond the 56-day service standard in the first year of the remission policy; they qualified for a 25 per cent refund of the $153 application fees. Another 222 applicants, who waited 29 days or more, would receive 50 per cent in remission of the paid fee.
Remissions under these two programs totalled just under $50,000.
During debates on the federal budget that passed in June, the immigration department had asked for exemptions from fee remissions for a string of programs: authorization to return to Canada, rehabilitation for criminality and serious criminality, restoration of temporary resident status, and temporary resident permits.
However, clauses relating to the exemption were defeated by the standing committee in finance and were removed.
Caron said uniform and predictable processing times and service standards cannot be established for those programs as they are highly dependent on third parties such as foreign judicial systems and international public safety organizations.
“Due to the high complexity and discretionary nature of the decisions associated with these applications, few can be considered straightforward,” Caron told the Star, adding that officials are still assessing the status of those programs to ensure compliance with the Service Fees Act.
May numbers are similar to April as the first months of the pandemic resulted in drastic shutdowns and reductions across the suite of immigration-related programs.
The number of TR2PR transitions continued to decline. While in 2021, these transitions (some double counting) averaged about 68 percent of all Permanent Residents admissions, in 2022 this share had dropped to about 51 percent, suggesting a decreased “inventory” and/or a conscious government decision too redress the balance and address backlogs.
Temporary residents (IMP and TFWP) continued reflected an ongoing return to pre-pandemic levels along with the seasonal changes in agriculture workers. The number of not-stated IMP has increased, from forming about 9 percent of all IMP in 2021 to about 23 percent in 2022, possibly reflecting coding issues.
International students, applications and permits, reflect normal seasonal patterns. As noted, given the number of media and other reports regarding private colleges being used more for immigration than study purposes (and related exploitation), IRCC needs to consider seriously disaggregating post-secondary study permits data to separate out public and private sector institutions.
Citizenship looks on track to continue whittling away at the backlog of about 400,000 (as if June 1st).
The number of Ukrainians arriving in Canada, mainly under the Canada-Ukraine authorization for emergency travel remains significant, comprising half of all visitor visas in April and May.
Ukraine is one of only about 26 nations that does not allow dual citizenship. In recent times, including immediately before the February invasion, there were calls to change the citizenship laws to reflect the modern reality of what citizenship could mean in Ukraine.
Proponents argued that some foreigners, by merit, deserved citizenship: Such as foreigners who came to Ukraine and volunteered in the Ukrainian Armed Forces, deserved the right of obtaining Ukrainian citizenship without relinquishing their other passport. Other arguments were more pragmatic: millions of Ukrainians live outside of Ukraine, many send money home which contributes to the roughly 10% of pre-war GDP of Ukraine, and have obtained foreign passports which should not deprive them of their right to being Ukrainian.
Likewise, arguments were made that the current citizenship laws put Ukrainians living under occupation, such as in the Donbas, in legal limbo if they have chosen, or been forced, to receive a “DNR” or “LNR” passports. The hundreds of thousands, or perhaps millions, of Ukrainians in Crimea may have less appetite for returning home to Ukraine if they felt that they would be discriminated against for having received Russian passports – said some.
Earlier this week, President Vladimir Zelenski tasked Prime Minister Denis Shmygal with investigating how best an exam of the Ukrainian language could be introduced for those seeking to obtain Ukrainian citizenship. The President’s instructions came following a public petition that had been signed by over 25,000 Ukrainian citizens.
What will happen next with the legislation is unclear, but given the strongly patriotic public sentiment now in Ukraine, it is likely that the language exam will be introduced in the near future.
Multicultural Meanderings 