Investor-friendly golden visa schemes have come under the scrutiny of the European Commission, which claims that in many cases these have posed a security threat, particularly due to the lack of transparency and poor cooperation between member states, adding that it will begin to monitor activity and developing a common set of security checks by the end of the year.
A Commission report released this week identifies the risks involved in investor visa programs, which include security, money laundering, tax evasion and corruption.
More specifically, Cyprus, Bulgaria, and Malta have been singled out for granting golden visas to investors under questionable conditions, including among others no obligation of physical residence or having genuine connections with the country before obtaining citizenship.
Last year, citing security risks, the Commission urged member states to restrict issuing investor visas to non-nationals.
It should be noted that currently over in 20 EU states – Bulgaria, Czechia, Estonia, Ireland, Greece, Spain, France, Croatia, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia and the UK – run such programs granting foreign nationals fast-track citizenship and/or residency in exchange for set investments as well as instant Schengen Area access.
“Legally residing in the EU and in the Schengen area comes with rights and privileges that should not be abused. Member states must at all times fully respect and apply existing obligatory checks and balances – and national investor residence schemes should not be exempt from that,” said Commissioner for Migration, Home Affairs and Citizenship Dimitris Avramopoulos.
Several incidents of shady golden visa practices have been reported, including lack of due diligence checks to verify where the applicants’ money comes from.
In Greece, earlier this year the government moved ahead with revisions to a legal framework covering its golden visa scheme in efforts to ensure transparency after reports of illegal dealings.
In view of the leniency of such programs, the Commission announced that it will strictly monitor compliance with EU law and will proceed with necessary action as appropriate.
It advises EU members running such schemes to ensure that obligatory border and security checks are systematically carried out; long-term residence permit and family reunification directives are complied with; funds paid by investor citizenship and residence applicants are assessed according to EU anti-money laundering rules; and tax evasion is addressed through administrative cooperation.
“We want more transparency on how nationality is granted and more cooperation between member states. There should be no weak link in the EU, where people could shop around for the most lenient scheme,” said Commissioner for Justice, Consumers and Gender Equality, Věra Jourová.
EU countries will be monitored and Commission experts will step in to work towards improving the transparency, governance and security of the said programs.