A Ticking Clock: Time Remains for New Investors Interested in the Portuguese Golden Visa Programme

As the Portugal Residency by Investment Programme, popularly known as the Portuguese Golden Visa, nears its end, a variety of opposing viewpoints on how applicants should proceed have emerged, leaving prospective clients unsure of whether to proceed with their investments or look for alternatives.

In recent years, this Golden Visa has been a programme of choice for many South Africans interested in alternative residency because of the attractive Portuguese tax regime. Additionally, Portugal remains one of the safest countries across the world, with a well-known, positive quality of life.

Regarded as the most sought-after pathway to the European Union since its inception in October 2012, holders of this visa have continued to enjoy visa-free movement in the Schengen area. To echo the words of the Prime Minister of Portugal, António Costa, the programme has truly “served its purpose” and has undeniably been one of the most successful residency programmes in the EU.

Upcoming Changes

According to recent data released by the Serviço de Estrangeiros e Fronteiras (SEF), a total investment of €6,327,164,148 made by non-EU nationals from South Africa, the United States, China, the United Kingdom and Lebanon was recorded in the month of April 2023 alone towards residency by investment in Portugal. A little more than 80% of the total investment went to the real estate market, and the remainder invested in capital transfers.

With the recorded success of the programme, the Portuguese government is still open to receiving new applications amidst the looming closure of the programme. This is not entirely new when it comes to citizenship and residency programmes; closures and restructuring are unavoidable. The real estate crisis and pressure from the European Commission to end similar programmes are among reasons contributing to the closure of the Portuguese Golden Visa Programme.

Regarding taking on new applications, what is known thus far is that the parliamentary discussions on the final proposal commenced on May 19, 2023, following the initial announcement on February 16, 2023, and subsequent submissions from the public. It is anticipated that the entire legislative process will take a minimum of two and a half months. Furthermore, there is a possibility that additional investment options will be included during these discussions in Parliament. In any case, the final outcome would still need to be endorsed by the President of Portugal.

The most important point to note is that the programme is still accepting new applications until new legislation is approved and published. Clients are, however, cautioned to be careful when choosing an investment option considering the limited time constraints.

For individuals wishing to relocate to Portugal or who want to obtain a return on their investment, the real estate programme may no longer be a viable option. Instead, applications for investments under artistic production, recovery or maintenance of cultural heritage may be more feasible under the lower investment threshold.

The current legislative process suggests that applicants have limited time to submit applications. Therefore, it is prudent for those who are still interested in the programme to consider the application timeline for their preferred investment option to ensure that their application is submitted on time.

Clients who do not already have a Portuguese tax identification and bank account should prepare for an added administrative layer which can further cause delays in the application process. Like any other programme slated for amendment, there needs to be an alternative plan for pending applications. As such, the Portuguese government has chosen the D2 visa as the transitional path for Golden Visa holders who wish to renew their status in the future while still subject to Golden Visa legal requirements. It is therefore safe to conclude that there is still a bit of time for last minute takers!

Need to know more?

In addition to the Portugal Golden Visa programme discussed above, Fragomen’s Private Client team can assist with providing tailored guidance on various alternative residences, citizenships and global mobility solutions across multiple jurisdictions. Please contact Senior Private Client Consultant Ziphozihle Ntlanganiso at [email protected] for any additional information.

This blog was published on May 26, 2023, and due to the circumstances, there are frequent changes. To keep up to date with all the latest updates on global immigration, please visit our dedicated COVID-19 site, subscribe to our alerts and follow us on LinkedIn, Twitter, Facebook and Instagram.