What is Residency By Investment?

Published September 12, 2020

What is Residency By Investment?

Residency by investment is the process of obtaining residency right in a foreign country by investing in that country’s economy.

Programmes aimed to attract foreign investment can be found across the globe. Some of these offer residency or citizenship rights, in exchange for substantial investments.
In Europe, most European Union Member States offer residency by investment (RBI) programmes (so-called ‘Golden Visas’).
The residency programmes main advantage is access to residency, in exchange for specified investments via a clearly outlined process. Although they share common features, these national residency programmes vary greatly in terms of applicants’ requirements and rights granted to them.

The 3 main characteristics that distinguish different residency programmes are:

1. Investment obligations.
The investment amount required and the type of investments offered. These investments can be active, such as setting up a business and creating jobs, or passive, whereby the investor may buy government bonds or property.
2. Required physical presence on the country of interest.
Some programmes require that the applicant spend some time on their country of choice to maintain residency status.
3. Freedom of movement.
European countries that are members of the borderless Schengen Zone offer visa-free travel in all 26 Schengen Zone countries as part of their residency programmes. Obtaining residency rights in these countries can, therefore, expand and facilitate travel options, a key aspect for frequent travellers.

Principally, residency by investment programmes target investors from countries undergoing wars or political and economic crises, where lack of safety is a primary and vital concern. This category of investors, widely known as high net worth individuals, seek easy access to safe destinations with a good quality of life and high educational standards. These benefits are undoubtedly the best kind of ‘insurance policy’ for people who try to escape from dire conditions in their countries of origin.

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