Dateline: Sofia, Bulgaria
If you want a second citizenship, being an entrepreneur is one of the best tools to have in your arsenal. Quite simply, many countries are eager to have new businesses set up shop on their turf.
As countries seek tax dollars and bragging rights (think Estonia’s fascination with homegrown Skype), the world is becoming increasingly competitive as more countries enter the fray.
In your lifetime, at least a dozen new countries have joined the game. The Baltics, the Balkans of former Yugoslavia, Romania, and Bulgaria have almost entirely become low- to moderate-tax havens looking to encourage business in just the past twenty years.
One of the ways countries around the world encourage and reward entrepreneur investors is with immigration privileges. Consequently, there are new second residency options opening up across a broad range of countries every year.
However, it’s also true that residency and citizenship programs close their doors every year, as well. I recently shared how a four-year-old Excel file I had forgotten about had become almost entirely out-of-date as each country I listed back in 2012 has changed or eliminated their entrepreneur visa program in some way.
If you haven’t seen the list, you can read it here. Today, however, I want to address a specific immigration program: Ireland’s Business Permission Scheme.
What is the Irish Business Permission Scheme?
Under the Irish Business Permission Scheme, entrepreneurs were able to start a business with as little as €300,000 and no application fee. In return, they would receive a 12-month business visa. The program traditionally focused on retail, catering, personal services and similar businesses, but was open to any type of job-creating business.
The approved business had to create employment for at least two Irish/EEA/Swiss nationals and add to the competitiveness of the Irish economy and commercial activity. The applicant needed to earn enough from the proposed business to maintain themselves and any dependents (who were also extended visas through the program).
The application process demanded a statement of character from police authorities in any country in which the applicant had resided for more than six months in the past ten years. They also had to provide proof of their entrepreneurial skills.
After the first year of residency, the applicant could apply for renewal. Renewal required proof of audited accounts and evidence of tax compliance, employee P60s, bank statements from the past six months, valid work permits for employees and a tax clearance certificate. If all the requirements were met, another 12-month visa would be issued.
Applicants did not receive any special tax treatment or citizenship opportunities, but their business did enjoy Ireland’s low-tax policies and business-friendly environment.
Irish residency program suspension
The program, however, has been suspended. What’s more, before suspension of the program, the number of business permissions granted was already in decline. From 2008 to 2011, 411 applications were submitted and 218 were approved. From 2012 to 2014, the Irish government only extended 68 new permissions and renewed 61. In 2014 only ten new permissions were granted.
According to the Irish Naturalisation and Immigration Service (INIS), the program was suspended as of March 16th, 2016. In fact, all business, entrepreneur and investor-related migration programs are currently under review. So far, the Business Permission Scheme is the only program that has been fully suspended. The good news is that all applications submitted before March 2016 will still be considered.
There is some talk that a new scheme will take the program’s place connecting the business scheme to the existing investor scheme, but there is no guarantee that the program will ever return.
Take it as fair warning that if you’re an entrepreneur, you need to get a residency ASAP. The programs that allow you to invest small money come and go and often don’t return. If you see a program that fits your needs, you do not have the luxury of mulling over it. Just do it.
If you still have your eye on Ireland and have a little more cash or a specific type of business, you still have a few residency options. In 2012, the Irish government launched two new programs: the Immigrant Investor Programme (IIP) and The Start-up Entrepreneur Programme (STEP). Let’s take a look at both…
The Immigrant Investor Programme (IIP)
The Immigrant Investor Program (IIP) offers investors six different options ranging from €500,000-€2 million, depending on investment type. Each investment type requires a non-refundable application fee of €750. As of July 18, 2106, two of the options are temporarily suspended. The six options include:
1. €1,000,000 investment (previously €2 million) in the Immigrant Investor Bond at 0% interest rate.
2. €500,000 invested in an Irish Enterprise for three years (previously €1 million).
3. €500,000 invested in an approved fund (added in 2013).
4. €2 million minimum investment in any Irish REIT (or spread across a number of different Irish REITs) listed on the Irish Stock Exchange.
5. €950,000k mixed investment — €500k invested in the Immigrant Investor Bond and a minimum purchase of €450k on a residential property.
6. €500,000 philanthropic donation by an individual (€400,000 where five or more individuals pool their donation for an appropriate project.)
Unlike the Business Permission Scheme, successful applicants of the IIP will receive a Stamp 4 visa, which gives them two years of residence with the option of extending another three years. After the first for five years of residence, the investor can apply for an additional five years. The investor is not required to have residence in Ireland to maintain their residency but must visit Ireland at least once a year.
Similar to the Business Permission Scheme, applicants’ spouses and minor children can also obtain an Irish visa. In some cases, children between 18 and 24 may also receive residency status. Some investors may qualify for a discount of up to €50,000 for higher-level education expenses, including for children.
Qualifying for the program is relatively straightforward. As of April 2015, 55 of 57 applications were approved. Additionally, as long as the required funds remain invested, investment performance won’t affect residency.
The Start-up Entrepreneur Programme (STEP)
The STEP is designed specifically for foreigners who have feasible proposals for a High Potential Start-up (HPSU). An HPSU is a company that:
- Introduces a new or innovative product or service to international markets
- Involves manufacturing or internationally traded services
- Is capable of creating 10 jobs in Ireland and can achieve €1 million in sales in three to four years
- Is led by an experienced management team
- Is headquartered and controlled in Ireland, and
- Is less than six years old
The other main requirement is proof of access to at least €50,000 in funding for the start-up and an additional €30,000 per person for any subsequent entrepreneurs involved in the venture. The funding can come from an applicant’s own resources or earnings, a bank loan or venture capital funding. The application also comes with a €350 non-refundable fee per applicant.
Successful applicants will receive a Stamp 4 visa, the same visa given to IIP investors. In addition, entrepreneurs attending incubators, innovation boot camps and preparing documents to apply to the STEP will be given a 12-month immigration permission prior to beginning their start-up.
Qualifying for the STEP is much more rigorous than the IIP application process. From January 2012 to April 2015, the Irish government accepted 30 applications and rejected18. Rejected applications used to be sent to the Business Permission Scheme, but now that the program has been suspended no such option exists.
However, once you are approved, Enterprise Ireland provides HPSUs assistance to help start, grow, innovate and expand to global markets.
Other residency opportunities
For the lucky Irish, you may be able to bypass all these requirements and fees if you have parents, grandparents or even great grandparents who are Irish citizens.
For those looking for something different, there are other entrepreneur residency options in Europe, including for less money. Some have good passports, others are not quite as good.
But, as I said, entrepreneur visas change faster than any other category. So, if you find a program that works for you, act before the opportunity is lost.
If you want my help finding the perfect program for you and your business or investment, apply for a Strategy Call. We can examine at depth your needs and design an action plan that will fit your needs and end goals.