The new Bulgarian citizenship by investment program – some specific questions from our clients
Today we are responding to one of our valued clients with his six questions regarding the Foreigners’ Law and the Law for the Bulgarian citizenship.
Requirement to visit Bulgaria while holding permanent residence status
Please could you confirm if the investors who have maintained their investments (either full or financing) for 5 years, and have also completed 5 years of PR and have also applied for citizenship (which was rejected on the basis of an unlawful principle of having active investment at the time of citizenship application) are required to visit Bulgaria once every calendar year? Is it mandatory under Law? Or under rules of Government Department?
Unlawful principle or strictly by the law?
First of all, we would strongly object the term “unlawful principle of having active investment at the time of citizenship application”. Our reasoning follows further in the report.
Financed vs non-financed investment
Secondly, it is important to comprehend that the old Law for the Bulgarian citizenship and the old Law for the foreigners in Bulgaria, didn’t make distinction as to whether the investment of the citizenship candidates has been financed or not. The only restriction was in art. 25 (1), p.7 of the Law for the foreigners. This restriction was applying only to investments in the form of trust management account. Namely, it was not allowed to use the investment as collateral to obtain credit from Bulgarian credit institutions (ie Bulgarian banks). In the most widely used investment option – Bulgarian government bonds, it made no formal difference whether the investment was financed or not. Please note that by the new foreigners’ Law, financing the investments in bonds, shares and investment funds is not allowed.
The real question
From the question, we assume that the investors have obtained permanent residence in Bulgaria by investment. We understand that they have maintained their investment and their permanent residence status for 5 years. After the 5 years term, they have applied for citizenship under the semi-fast-track option. We understand that their citizenship application has been rejected. It is stated that the reason for the rejection is an “unlawful principle of having active investment in the time of citizenship application”.
The question is: are the investors who have obtained permanent residence by investment and are not approved for citizenship, required to visit Bulgaria once every calendar year?
The six years absence rule
The new Law for the foreigners (art.40) foresees different cases when the permanent residence rights of the foreigners will be revoked if they do not live or visit Bulgaria or the EU. The investment residents are exempt in almost all of the cases, unlike the non-investment residents. The only case when the investment residence will be revoked in case of not visiting is when the foreigner has not been present in Bulgaria for a period of 6 years. With that being said, there is no formal requirement for the investment resident (PR) to visit Bulgaria every year.
Long absence from Bulgaria, now what?
There are clients who had obtained their PRs initially (around 8 years back) and never visited Bulgaria or visited once after that. Their PR cards have also expired. Please advise if these cases still have a valid PR and can apply for card renewals now and subsequently citizenship?
As already explained above, after a 6 years absence from Bulgaria, the PR status of the foreigner will be revoked. Therefore, if the foreigner has never visited Bulgaria after PR was granted, then he would have surpassed the 6 year legal term and his PR status will be canceled. If the foreigner has been in Bulgaria once and has not exceeded 6 years absence from the country, then he will not fall within the “6 years absence” rule.
The investment must be maintained and available in all cases
In both cases above, the foreigner may apply for new PR card, as the initial 5 year card has expired. In both cases the foreigner will need to prove that the investment is still available.
The importance of the six years absence rule
If the foreigner has not exceeded the “6 years absence” rule, he should be already eligible for citizenship if the following three (investment related) conditions are met:
- The investment has been available for at least 5 years, and;
- The investment has been available at all times, and;
- The investment is available at the moment of the citizenship application.
In case that the “6 years absence” rule has been violated, the foreigner will be eligible for semi-fast-track citizenship in five years after he obtains his new PR card. This is of course provided that the investment is maintained for the whole period.
Applying for Bulgarian citizenship even if the investment is unavailable at the application?
All the above mentioned clients, who have maintained their investments (either full or financing) for 5 years, and have also completed 5 years of PR are grandfathered under the new law? This means they can apply for citizenship and get it even if their investments are not valid as of today?
Investment must be available at the moment of the citizenship application
Neither the old nor the new citizenship Law mention explicitly that the investment needs to be available at the moment of the application. However, art. 22(1), p.4 of the said Law stipulates that the semi-fast-track investment citizenship will be revoked if the investment has not been maintained for one year after citizenship is granted. With that being said, the citizenship will not be granted if the investment is not available at the moment of the application.
The new citizenship law grandfather clause
All such clients who had applied for citizenship before and their citizenship applications had been rejected with the reason of non-validity of investment at the time of approval from citizenship committee or signing of decree by the VP, are grand fathered under the new law and will be able to apply again and the investment validity will not be a problem this time?
According to the Law for the foreigners (art. 40(1), p.1), the PR status will be cancelled at any time if the investment becomes unavailable. According to the citizenship Law, the investment need to be maintained for one (or two) year after citizenship is granted. If this is not the case, the citizenship will be revoked. With that being said, all applicants whose investment have become unavailable will not be grand-fathered on basis of the already unavailable investment. Accordingly, these applicants will not be able to obtain citizenship, if their investment is not available at the moment of the application.
And again about the availability of the investment
Is there any possibility that investors whose previous citizenship applications had been rejected unlawfully, can be reinstated and processed under new law?
In case the investment has become unavailable, at any time, the only possibility is to apply again from scratch. We would strongly opposed the term “unlawfully” for the reasons, explained above.
What if the main applicant has deceased?
We have one particular client who had died 2 years back. His investment was under financing option and his entire family has PR status but expired cards and haven’t visited after the 5 years of PR. Please advise what could be done for them under new law?
Unfortunately, the family members will be not able to obtain investment PR status anymore, as they do not qualify as “family member” of investment permanent resident under the foreigners’ Law.
Standard naturalization after 5 years still possible
However, if they have not violated the “6 years absence” rule, they may be already eligible for Bulgarian citizenship under art. 12 of the citizenship’s Law (standard naturalization). In this case however, they will need to pass successfully Bulgarian language exam and may also need to relinquish their existing citizenship.