Second Residency and Citizenship in a post-Covid 19 world
By Daniel Lucas, Q Wealth Report Editor
Many of you reading this will be individuals who value the ability to move freely around the world. The Covid-19 crisis radically and rapidly curtailed this freedom, with travel restrictions and a dramatic reduction of flights halting travel for many.
However, while it’s easy to generalize and say that international mobility – at least at the levels we have enjoyed previously – is a thing of the past, the truth is likely more complex.
For individuals who have a second residency or citizenship of another country, traveling to that country from where they currently find themselves will probably be a bit more complicated, but not at all impossible.
Likewise, a second residency or citizenship will also grant easier access to other, third countries.
For example, for anyone possessing a European passport, travel to most other countries within Europe has already become possible, while access to individuals who hold non-European passports is still banned until June 15th – with a possible extension looming for many countries.
This restriction in travel capabilities obviously boosts the rationale for establishing a second residency or citizenship somewhere (if travel is important to you).
It might be where you do business, where you like to go on holiday with your family, or somewhere that you know can provide security in a time of crisis. Having a second residency or citizenship somewhere might be the one assurance you can have for maintaining such links to a country other than your own.
Added to that, it appears that the economic crisis the world currently faces is going to compel many countries to become a lot more competitive when it comes to the second residency and citizenship ‘market’.
Once shunned as a controversial practice reserved for island states with opaque governance credentials, the ‘Golden Passport’ business is likely to expand as cash-strapped governments look for new ways to boost revenue into their coffers and pull investment into their economies.
For example, EU member state Cyprus has recently announced a raft of new measures and regulations for their Citizenship by Investment (CBI) scheme, which are essentially meant to address and ease the concerns of Brussels over what it has essentially deemed the selling of EU citizenship.
What’s interesting about the new tighter regulations approved by the Cypriot cabinet is a clause that allows the government to revoke citizenship from someone who has been naturalized if it “was found that a candidate for naturalisation was either involved or has been convicted of a serious crime.”
Aside from the slightly vague wording (can you be found to be involved in a crime without being convicted?), what this means is that Cyprus will essentially be developing a new form of ‘hybrid’ citizenship, which is essentially the same as an ordinary citizenship apart from one key point: it can be easily revoked.
This might be considered an innovative product development to assuage EU fears, but it remains to be seen if the proposal will be accepted by Brussels, or draw more condemnation and finger-wagging.
The likely outcome is probably going to be a mixture of both, as the EU comes to recognize how a CBI program can bring not only benefits to the individual member states, but serve as a conduit for investment into the entire block in the long run.
Who knows, this could even lead to a tacit approval, or even a subtle facilitation and broader formalization of the practice by Brussels. Our friends over at Investor Migration Insider Daily have written a very informative and interesting article explaining this interesting phenomenon.
All being said, the fact is that many countries will find it to be a matter of economic necessity and rationality to begin using their citizenship as a national product that can be used to generate cash and bring in investment. With the right regulatory approach, the industry will be able to become more competitive and open, to the benefit of all parties.
A silver lining of the Covid-19 crisis might very well be a larger, more accessible and affordable selection of citizenship and residency options for people from across the world to choose from. And who knows, this might even force some countries to rethink how they treat their citizens, once they understand that they do not have a monopoly over them.
The prospects, direction and options of second residency and citizenship in a post Covid-19 world are going to be key topics in our upcoming Covid-19 report.
Drawing on our own experience in the industry and using insights from experts in the field, we’ll be providing our paid members with a comprehensive breakdown of the future of the industry, and some of the best options out there to choose from.
Paid membership is still available at a discounted rate of $5 per year, but we will soon be transitioning to a more expensive, monthly subscription. So if you want to get access for the discounted price, we recommend purchasing it soon.
Have any experiences with a second residency or citizenship program you’d like to share? Get in touch and let us know.