Portuguese Parliament Approves Changes to Golden Visa Legislation

In a significant move on July 19, 2023, the Portuguese Parliament voted to finalize the wording to the changes of the Golden Visa legislation which will make the program more restrictive and focused on investment in research, culture, and job creation, marking the culmination of a legislative process that commenced on February 16th. This landmark decision has far-reaching implications for the Golden Visa program and its applicants. But the question on everyone’s mind is, “When does the new law come into effect?”

Following the Parliament’s approval, the legislation must now be sent to the President for further action. The President has three distinct options for handling the proposed changes.

The first option is “Direct Ratification,” where the President can approve the proposal outright. If chosen, the legislation will be officially published in the country’s official journal and will take effect the day after publication without any further modifications. Alternatively, the President may opt for the “Request for Amendment” route, wherein the proposal is not accepted in its current form. In this case, the legislation is returned to the Parliament for necessary amendments before it can be reconsidered for ratification. The third option available to the President is “Constitution Court Evaluation.” Here, the President accepts the document but seeks an evaluation from the Constitution Court to ensure that the new legislation does not endanger any fundamental rights or principles.

The President has a period of 20 days to make his decision on which of these courses of action to pursue. The President’s choice will play a critical role in determining the future implementation and impact of the Golden Visa program in Portugal.

The revised Golden Visa legislation brings several notable changes to the program:

1. Conversion of Pending Applications: Pending applications will now be converted into the Entrepreneur Permit. However, the specific impact of this conversion is yet to be detailed, and it is likely that the 7-day flexibility period will remain.

2. Exclusion of Real Estate Options: Real estate options, whether through direct or indirect investment, will no longer be eligible under the new legislation.

3. Expanded Investment Fund Option: The scope of eligible investments includes “collective investment entities” focused on capitalizing companies.

4. Introduction of Competent Authorities: The legislation introduces competent authorities to verify the suitability of investments for the respective entrepreneurial projects.

Under the revised Golden Visa program, the following investment options are eligible:

1. Creation of at least 10 jobs.
2. Capital transfer equal to or exceeding 500,000 euros for research activities in the national scientific and technological system.
3. Capital transfer equal to or exceeding 250,000 euros for investment or support to artistic production and cultural heritage preservation.
4. Capital transfer equal to or exceeding 500,000 euros for shares in non-real estate collective investment entities incorporated under Portuguese legislation, with at least 60% of the investments in Portuguese commercial companies.
5. Capital transfer equal to or exceeding 500,000 euros for the incorporation of a commercial company with headquarters in Portugal, combined with job creation.

It is essential to understand that these changes will not have a retroactive effect, meaning they will not apply to past cases or applications. Existing rights, including renewal, family reunification, and permanent residency applications, will be protected and remain unaffected by the new legislation.

For pending concessions and renewals, they will be approved under the existing regime, ensuring continuity for applicants in the pipeline. Additionally, future renewals for investment options that have been revoked will be assessed under the Entrepreneur Permit regime, removing the previous requirement of 183 days/year residency for these cases.

These measures aim to provide clarity and assurance to current and prospective Golden Visa applicants, maintaining their rights and minimizing disruptions during the transition to the new legislation.

As the new legislation takes effect, potential Golden Visa applicants and current participants must be well-informed about the changes to make informed decisions.

Source - Citizenship Invest