The Cyprus investment program of 'golden passports' was mired in corruption
Previously, thanks to the 'golden passport' program, anyone could obtain citizenship or residence permit in all EU countries by investing in Cypriot real estate. Such a tempting opportunity attracted investments into the country's economy, but this accessibility of obtaining EU citizenship caused serious concern in the European Commission. As 'Russkaya Germaniya' notes, Brussels repeatedly called for a review of the 'golden passport' issuance system.
For wealthy foreigners, the Cypriot citizenship-by-investment program offered very favorable terms. Initially, Cyprus issued passports for investments from 2 million euros, then, due to criticism from the EU, the threshold was raised to 2.5 million. Investors in Cyprus were exempt from income tax on the sale of securities, tax on dividends and interest income. Many foreigners were also attracted by the fact that citizenship was granted for life and for generations to come.
'The ministers of finance and interior presented a proposal to cancel this program. The proposal was based on long-term shortcomings as well as abuse of the provisions of the Cyprus Investment Program. The decision will take effect on November 1, 2020,' said the official government spokesman in October. He also explained that the cancellation of attracting foreign investments for citizenship is final.
The politician's statement was made the day after the release of an investigative film by Al Jazeera, which reported on the possible involvement of officials in serious abuses and violations in granting citizenship. The TV channel revealed that the Cypriot Ministry of Interior, disregarding national legislation, provided 'golden passports' to individuals with criminal records, as well as those suspected of various crimes and even wanted at the time of their application review.
The Cypriot authorities initiated an investigation, and on October 7, the Council of Ministers decided to launch a procedure to strip seven holders of 'golden passports' of their citizenship for giving false testimony and concealing information.
The decision to wind down the program turned out to be forced. Had it not been for the scandal and the disclosure of compromising material, the island's authorities would hardly have abandoned the practice of rewarding with a passport those who invested at least $2 million in the Cypriot economy. Over its existence, this program brought over $7 billion to the country's budget.