Adding new conditions to getting Golden Visa residency permits in Cyprus that include passports for the 28-member European Union hasn’t deterred rich Chinese and investors from that country for continuing to queue for them.
With critics saying the government hasn’t done enough to get applicants for possible money laundering and hiding cash from criminal activities, the bar for eligibility could be set even higher, including a 2-million euro ($2.27 million) investment in property and 75,000-euro ($84,950) donation toward research and development.
That effectively shuts out all but the wealthy, including Cypriots of the Diaspora or with Cypriot heritage who will have to go through normal channels to get the same residency permits passed quickly to rich investors who have no link otherwise to Cyprus and don’t have to live there.
The Golden Visas have brought in some 4.8 billion euros ($5.44 billion) since 2013, when President Nicos Anastasiades had to seek a 10-billion euro ($11.33 billion) international bailout after a banking crisis almost brought down the economy.
The country has recovered since then on the back of record tourism and the Golden Visas, leading Anastasiades to dismiss criticism the government wasn’t checking for whether applicants had criminal backgrounds well enough.
Pantelis Leptos, Director of the Leptos Estates Property Development, told in-Cyprus there isn’t any official data on nationalities of investors but said most at the luxury Del Mar development in coastal Limassol are Chinese.
Dolphin Capital, in a report about Aristo Developers in coastal Paphos, said most of the buyers there are Chinese, the news agency said, adding that Chinese media reported a total of 4,846 properties were sold over the first five months of 2019. T
The Chinese reports note that among the advantages of Cyprus in attracting investments is the avoidance of tax on property, stamps and dividends, as well as of bureaucracy.
In February, China’s government was said to be trying to hunt down tax cheats, including wealthy people buying up property on Cyprus to get Golden Visas.
China is applying new tax rules in a bid to keep citizens from spiriting money abroad and hiding their assets in foreign properties, such as on Cyprus, which has been accused of selling the visas without vetting applicants for possible tax evasion, money laundering or criminal activities.
Implementation of the Common Reporting Standard (CRS) which focuses on the exchange of information between China and other countries showed a large number are tax dodgers who will be chased to pay what they owe, the financial news agency Bloomberg reported.
CRS can be used to find a Chinese citizen opening an account in a Cypriot bank with Cypriot authorities required to notify Chinese officials, and vice versa, although real estate is excluded, making it easier to hide assets than cash.
The Paris-based Organization for Economic Co-operation and Development said it’s also up to banks to ask for the additional information from foreigners and then forward it to the tax officials in their countries, INSIDER said.
The Bloomberg report said Chinese have taken advantage of Cyprus’ Golden Visa program that has drawn scrutiny from European Union officials although it was defended by Anastasiades who said other countries have worse records vetting applicants.
A Cypriot Foreign Ministry study showed it is mostly Russians and Chinese who obtained Cypriot citizens by investing primarily in real estate and that Limassol is the top choice for f Russians who buy apartments in high-rises, while the Chinese choose Paphos to invest in houses and property.