16/02/21

EUROPE: Portugal postpones golden visa restrictions.

As published on international-adviser.com, Monday 15 February, 2021.

Foreign investors looking to apply for a golden visa in Portugal will be able to take advantage of the current framework for an additional six months.

The move follows the government’s decision to extend the implementation of several amendments until 1 January 2022, as they were supposed to come into force from 1 July 2021.

The changes will mostly impact the minimum investments required to qualify for the scheme.

João Cunha Vaz, senior partner at Edge International Lawyers, explained to International Adviser that this means the amended rules will only affect applications submitted after 1 January 2022.

Until then, the current requirements still stand.

He added: “These amendments are focused on two main aspects: increasing minimum thresholds of investments in certain categories, and defining the specific areas where property investments will be allowed for the purposes of substantiating a golden visa application.”

Cunha Vaz said, as of 1 January 2022, the new requirements will be:

• Capital investment; minimum €1.5m (£1.3m, $1.8m) – previously €1m;
• Investment funds; at least €500,000 – previously €350,000;
• Property investments; minimum sum required remains the same – €500,000 and €350,000 (for urban renovation) – but only in certain qualifying areas;
• Job creation: from €500,000 for incorporation/increase of share capital of a company which then needs to create five new jobs and maintain them permanently for at least three years – previously €350,000;
• Science and research activities: at least €500,000 – previously €350,000.

He added that the geographical restrictions will only apply to residential properties, while investment on any other form of real estate will not be bound to any such limitations.

“It is also clear that these amendments do not prevent the possibility to renew the existing applications under the terms of the existing rules and requirements, and also do not prevent adding family members to existing applications.

“In practical terms, all investors who have submitted their applications under the terms of the existing rules shall continue to renew their residencies with the same requirements applicable at the time of the initial application.

“At the same time, the decree-law also sets out that whoever submits their applications until 31 December 2021, will be grandfathered under the current regulations and requirements in force.”

According to Jason Porter, business development director at Blevins Franks, the move is part of Portugal’s economic recovery from the impact of the covid-19 pandemic.

He told IA: “Whilst Portugal’s management of the first wave of covid was applauded across Europe, the story of the second has not been so good.

“With two-thirds of the jobs created over the past four years under threat, there is a need to maintain the not inconsiderable inward investment Portugal has seen since the introduction of the golden visa scheme.

“Property development is a very important part of the Portuguese economy, and the requirement for investment in a property valued at €500,000 or more, has led a to property boom in Lisbon, Porto, the Silver Coast and the Algarve.

“Whilst covid has hit the property market hard, the vaccination programme and the deferral of a tightening in the golden visa rules should mean international buyers have as much encouragement as possible to come and buy, live and spend their money in Portugal.

“The postponement in the restriction in the golden visa rules should be seen in the light of the pressures the Portuguese government is facing.

“All of the hard work over the last 12 years, with unemployment at its lowest point since 2004, and a budget surplus for the first time in 45 years has been wiped out by covid.

“In one year, the economy has shrunk 8.1% and unemployment recently hit 9%. The economy needs stimulus and investment, and attracting this from overseas is one solution,” he added.