What you’re about to read may sound like rocket science.
Just ask Jelena, our strategy associate, or Jovana, our client relationship manager. When we explain the same concepts on this page to our high-net-worth clients, they act like we’re rocket scientists.
But here at Nomad Capitalist, we’re not in the business of launching people to the moon.
Instead, we’ve made it our mission to help you “go where you’re treated best” to enhance your personal freedom and grow and protect your wealth.
One of the most powerful tools we use to achieve this goal is the second passport, the ultimate backup plan and surest means of geopolitical diversification.
If dual citizenship and second passports already sound like rocket science to you (Wait, what?! You can have more than one citizenship?), you can head on over to our second passport page to learn the basics.
If you stay on this page, we’ll take you deeper into the realities of what you thought was only the stuff of fiction novels where international spies like Jason Bourne and James Bond carry around half a dozen personal passports with a stash of cash.
These days, second passports have leapt out of the pages of fictional spy stories and are increasingly showing up in the pockets of successful businessman, investors, and otherwise regular, but globally minded folk.
There are many ways to obtain a second passport, but the quickest path is to simply buy one.
Yes, you read that right: whether you refer to it as ‘buying a passport’, ‘economic citizenship’, or ‘citizenship by investment’, they all mean the same thing.
Certain governments are willing to grant you citizenship and a passport in as little as three months in exchange for a sizable investment or donation in their country.
Sound interesting? Read on!
WHAT IS CITIZENSHIP BY INVESTMENT?
It’s easiest to understand citizenship by investment when you break it down to its most basic elements.
First, what is citizenship?
At its heart, citizenship is the embodiment of the social contract (see diagram) – an agreement between individuals and society to work together to achieve mutual benefits.
In this symbiotic relationship, the citizen accepts certain responsibilities such as obeying the law, and in return, the state grants them rights such as property ownership, the vote, and the ability to work in the country.
In the last century, an additional right has come under the purview of the state – the right of movement.
As the world has developed and grown ever more interconnected, the state has come to rely on passports to control who has the right to enter and leave the country.
Because of this, a nation’s passport has become one of the most powerful benefits it can offer in return for each citizen’s contributions to society.
Every passport varies in its strength and desirability, just as the rights and responsibilities of each citizenship will differ to some degree depending on the country.
Whatever the terms may be, the ideal situation is one in which both the citizens and the state can enjoy peace, prosperity, and freedom.
Traditionally, citizenship (and its accompanying passport) has been granted through birth, naturalization, and marriage. But beginning in 1984, various countries around the world have introduced another path toward citizenship – the second half of our breakdown – investment.
As shown in the diagram above, one of the main responsibilities of a citizen is to contribute to the economy of their country of citizenship. Many western countries tend to abuse this right by exacting high levels of taxation, made worse by onerous reporting requirements.
But not all countries are like this.
Countries that offer citizenship by investment have determined that individuals who contribute to the economy by making an initial investment or donation fulfill this responsibility and merit citizenship in return.
This is citizenship by investment – a specific means set out by a government through which an individual can obtain that nation’s citizenship by making a qualified investment in the country.
This citizenship process is designed for wealthy people who want a fast track to dual citizenship and a second passport, or even multiple citizenships and an entire passport portfolio.
But it’s as simple as that: you make an investment and you get citizenship.
There are, of course, exceptions and important nuances between and within programs. And because not all citizenship by investment programs are the same, there is often confusion about which programs are legitimate citizenship by investment offerings verses residence by investment programs or even scams.
So, let’s clarify.
There are just four criteria you need to keep in mind to judge whether or not any given program is legitimately offering citizenship by investment:
1. THERE IS A FAST TIMELINE TO CITIZENSHIP
There are other paths to citizenship that do not cost nearly as much as citizenship by investment, but they will require more time and commitment on your part.
The big draw of citizenship by investment is that it is a quick process.
Once you apply and make your investment, you can generally expect to have your new citizenship and passport in less than six months (the record being 57 days).
Malta is the only citizenship by investment program currently available that takes more than a year to acquire. All the rest take a matter of months.
2. THE PASSPORT IS COMMODITIZED
The commoditized nature of most citizenship by investment programs means that almost anyone – regardless of their nationality, religion or language skills – can become an economic citizen.
Whether you’re from Pakistan or the United States, you can get a Dominica passport for the same price and they’ll accept you just the same as long as you pass the due diligence.
The only difference is that it might take them a few weeks longer to do the due diligence on a Pakistani or Qatari or Bahraini than it would take them to examine an applicant from the US.
Other than that, they don’t really care where you’re from. You make the payment, you get the passport.
3. THE APPLICATION PROCESS IS STRUCTURED
Any citizenship by investment program should have a clear structure. That means fixed investment amounts and a clear path to citizenship.
These citizenship programs operate almost like a business; any country that offers a murky path to a second passport most likely falls under another category.
Expect a process that is streamlined and structured.
Many countries will try to sweeten the pot by eliminating any need to relocate to or reside in the country, speak that country’s language, pay taxes, or fulfill basically any other requirement typically required of other citizenship applicants.
Just follow the process set out by the government and you will be approved.
4. THE PROGRAM IS 100% LEGAL
This seems obvious, but there are plenty of economic passport scams out there. If someone tells you that they have a buddy inside the government who can get you a passport in exchange for your payment, run!
A real citizenship by investment program will be enshrined in the country’s constitution or clearly and obviously stated somewhere in its law.
WHAT DOES NOT QUALIFY AS CITIZENSHIP BY INVESTMENT?
Most people in the citizenship industry sell passports like it’s McDonald’s.
Sadly, too many of our clients have come to us only after working with another company or agent who recommended a certain passport to them, not because of their individual needs but because the agent got a commission for promoting one country’s program.
Most of the time, these clients don’t even know why they were recommended one passport over the other.
Here at Nomad Capitalist, we take a holistic approach and consider all your needs, resources, and goals before determining which citizenship by investment program is best for you.
Other companies that only sell passports cannot see your big picture.
But poor recommendations are just the tip of the iceberg when it comes to all the incorrect notions about what, where, why, and how you can obtain citizenship by investment.
Let’s put an end to those notions here and now and clarify exactly what economic citizenship is by understanding what it is not.
1. EXCEPTIONAL CITIZENSHIP
There are many programs that look like citizenship by investment because they involve an investment of sorts and you get citizenship in return, but they are typically not structured or commoditized and they usually aren’t fast either.
Of the four ways to get citizenship, these hybrid programs fit better under the exceptional citizenship category.
You may be able to buy real estate in Cambodia or donate €3 million to Austria and get a second passport out of the deal, but these programs are highly subject to political whims and are not available to every willing applicant.
Those aren’t real citizenship by investment programs.
2. GETTING PAID TO GET A PASSPORT
There are other programs where you can invest money and essentially get paid for a passport. But, again, these programs are not commoditized.
I have done programs like this where an American can invest $150,000 in real estate and get citizenship in a year and then sell their investment for a profit. However, if you’re Iranian, forget it. You could invest $2 million and they wouldn’t accept you.
If you can only get a passportif they like you and you’re from a good country, that’s not citizenship by investment.
However, if you think you might qualify for a program like this, you can read all about them here.
3. RESIDENCE BY INVESTMENT
Residence by investment is not the same as citizenship by investment. Numerous countries will grant residence to those who invest money in their country, but that residence permit does not guarantee eventual citizenship.
All that the investment grants is entrance into the country.
Countries have various criteria that an individual can meet to qualify for a residence permit, from having a job offer to starting a company to marrying one of their citizens. Some countries decide to add an extra option and allow those who make an investment to reside in the country as well without having to meet the other criteria.
That’s not selling citizenship, that’s just allowing someone another way to become a resident. Once they are a resident, they can be naturalized the same as everyone else.
This is the case with the many different Golden Visa programs in Europe like in Greece and Portugal. While you can eventually get a second passport out of the deal, it will take at least five years of residence and you must learn some Portuguese and pass through the naturalization process to finally get your citizenship.
Many people like to talk about the US EB-5 program as if it were a citizenship by investment program as well, but it is a residence by investment program, not a citizenship program.
You can fast-track your ability to get into the US, but you must meet all the same criteria that anyone else moving to the US would have to fulfill, including living there the majority of the time, learning the language, paying US taxes, and waiting the necessary time before applying for naturalization the same as everyone else.
The one grey area is Bulgaria, which offers a residence by investment program with a fast-track to citizenship option. But this “fast track” still takes two or more years before official citizenship is conferred on the investor.
Compare that to the Caribbean citizenship programs where there is no wait time (besides due diligence and processing times that take as little as eight weeks), no residence requirement, and no language requirement. You make the investment and you get the citizenship.
Residence by investment is not the same as citizenship by investment.
4. OLD/RUMORED PROGRAMS
There is also the problem of people who think that programs exist that have never existed or did at one time and have since been canceled.
Because the offshore industry changes so frequently, there is a lot of confusion about what programs are currently in operation. In recent years, for instance, both the Ireland and Comoros citizenship by investment programs were suspended.
There are also situations where a country will talk about starting a citizenship by investment program but then never follow through.
Not long ago, there were rumors that Armenia was going to introduce a program. However, it turned out that it was just a lot of people in the industry speculating and Armenia was kind of going along with it.
However, there is now a new administration and any possibility of an Armenia citizenship by investment program is dead.
And then there are the scams. I get a lot of questions from people about this program or the other and I have to tell them, “Yeah, that’s a scam!” I’m never surprised when the websites promoting these scammy programs suddenly disappear.
The key to getting a second passport is to do so legally. Avoid any program that involves paying off corrupt officials. Any citizenship program you take part in should be referenced in the country’s laws. If the person promoting a program cannot show you the legal basis for your citizenship, run away.
Remember, a true citizenship by investment program is commoditized, structured, legal, and fast.
Anything that cannot meet all four requirements does not qualify as a citizenship by investment. That does not mean that other programs won’t work for you (unless, of course, they’re illegal), but it is important to know what you’re getting into.
If you want fast, easy, and secure, make sure you are investing in a real citizenship by investment program. Everything else comes with a certain element of risk.about:blank
WHERE CAN YOU GET CITIZENSHIP BY INVESTMENT?
Citizenship by investment programs come and go on a regular basis.
The two exceptions are the original citizenship by investment program in St. Kitts and Nevis, which has lasted more than 35 years, and Dominica’s program, which has been around for more than 25 years.
All the rest are less than a decade old.
And many have come and gone within this last decade as well, including the Comoros Islands program that I took advantage of during its short lifespan.
Some, like Montenegro’s program, have a set period of availability. Others have a limit on how many applications they receive each year.
And then there are the programs that meet political pushback, like Moldova, which has been suspended for the time being and will not accept new applications until the latter half of 2021, if they ever reopen the program.
The bottom line is that nothing is permanent in this industry.
If one of the programs below sounds like a fantastic deal, click on the “Learn More” button to get more details and then reach out to us so we can help you create a holistic offshore strategy that incorporates your second passport goals into your banking, investment, business, tax, and lifestyle goals as well.