Cyprus Confirms Citizenship By Investment Programme Will Continue
The request sent from the EU Commission on 1 April asking Cyprus to phase out its Citizenship by Investment Programme has been rebutted by the Interior Minister of Cyprus, Nicos Nouris. The Cyprus Government is therefore intending to retain the scheme despite queries raised by the Commission as to the adequacy of due diligence checks.
The Minister was quoted in the Daily Phileleftheros as confirming that Cyprus has no intention of ending the Citizenship by Investment Programme and further stated that due to the more stringent measures put in place after May 2019, there was no reason why such a scheme should be stopped. He insisted that the checks now being undertaken were far more thorough and vigorous.
The checks and measures to which the Interior Minister referred are, in part, the process of reviewing previous applications where Cypriot passports had been granted to the main applicant and their family members.
The Cyprus Government began a process of revoking citizenship where an audit revealed that a person or a member of their family had been accused of any crimes, or were the subjects of European or international sanctions. In November 2019, it was reported that Oleg Deripaska, a Russian billionaire with ties to the Kremlin, had his Cypriot citizenship rescinded as part of the stricter measures and review process. He was originally granted citizenship in 2017.
It is understood that 26 people have so far had their citizenship revoked.
The EU insists that such Citizenship by Investment schemes undermine the integrity of the bloc by granting access to individuals who may have questionable backgrounds. Critics of the schemes say that it is rife with corruption and creates major economic bubbles in key sectors such as housing and construction. Further concerns were voiced over the fact that an EU passport can be easily obtained in Cyprus for an investment of approximately €2m.
The EU also called for Cyprus to devise a plan detailing the winding down of the scheme, leading to the eventual closure of the scheme altogether. It also reportedly asked for the plan to be made available for review.
However, given the economic difficulty faced by many EU countries, including Cyprus, as a result of the COVID-19 pandemic, many supporters of the Citizenship by Investment scheme say that it boosts the economy and creates jobs which is vital in the current climate.
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