Citizenship Planning — Important Points

Citizenship is the relationship between an individual and a sovereign state, defined by the laws of that state and with corresponding duties and rights. It implies the status of freedom with accompanying responsibilities. Citizenship is the most privileged form of nationality, a broader term that is used in international law to denote all persons whom a state is entitled to protect. Nationality also serves to denote the relationship between a state and entities other than individuals. Corporations, ships, and aircraft, for example, possess a nationality. Modern concepts of citizenship crystallized in the 18th century during the American and French revolutions, when the term ‘citizen’ came to suggest the possession of certain liberties in the face of the coercive powers of absolute monarchs.

Passports and citizenship

A passport is a personal identification and travel document for international use issued by a sovereign state or a UN organization. Generally, only passports that are issued on the basis of a person's citizenship are of any interest and use.

Only through the acquisition of full citizenship can you legally acquire the right to a passport. Non-citizen passports and other passports issued to non-citizens are generally of limited use, with certain exceptions, for example the non-citizens passport issued to persons holding a retiree residence permit in Panama, which is legal but also of limited use. Other exceptions include diplomatic passports issued to non-citizens, UN, and refugee passports as well as certain travel documents issued by international organizations or individual states.

Diplomatic passports

Diplomatic passports are only legal and useful if issued by the competent authorities within the issuing state or international organization and if the holder is properly accredited in the host state. Normally, diplomatic passports are only issued to persons who are citizens of the issuing state.

Dual citizenship

Dual (or multiple) citizenship is the result of the interaction of the laws of two or more countries. People can become dual citizens automatically by birth within a certain territory, such as the USA, by descent from a citizen parent, by marriage, or after successfully applying for the citizenship of another country.

You can become a citizen of another country without losing your current citizenship only if the laws of the country of your current citizenship allow dual citizenship.

While many countries have no restrictions on dual citizenship, and while there is an international tendency to move away from strict single-citizenship policies, there are still important exceptions. Singapore, for example, is a strictly single-citizenship country and will require proof of relinquishment of any other citizenships the applicant may hold. Singaporean citizenship is consequently of limited interest to most international clients.

For an overview of citizenship regulations in selected countries with regard to dual citizenship, click here.

How to acquire alternative citizenship

Principal grounds for acquiring citizenship are birth within a certain territory, descent from a citizen parent, marriage to a citizen, and by naturalization. The conditions under which the privilege of grant of citizenship or naturalization is given vary from state to state, but family relationships or lengthy periods of residence are usually essential, besides character and other requirements such as knowledge of the national language.

Citizenship-by-investment

While residence permits are granted to investors and wealthy individuals in most countries, there are now only a few countries that have clear provisions in their laws for granting citizenship based on economic considerations and without residence requirements.

Australia, Canada, Hong Kong, Monaco, Portugal, the UK, the USA, Singapore and Switzerland are examples of countries that offer residence permits to wealthy individuals and investors. Other countries offer citizenship-by-investment programs, sometimes also referred to as economic citizenship programs, which is incorrect, as no separate or ‘economic’ citizenship exists. These programs allow an individual to become a full citizen but by investment instead of by marriage or birth. There are currently only six countries that offer citizenship programs, which provide a direct route to citizenship based on investment and which have passed Henley & Partners’ country due diligence — Antigua and Barbuda, Austria, Cyprus, Grenada, Malta, and St. Kitts and Nevis. The citizenship-by-investment programs of Antigua and Barbuda, St. Kitts and Nevis and Malta have been designed by Henley & Partners under relevant government mandates.

Citizenship-by-investment programs offer you the opportunity to legally acquire a new citizenship quickly and simply, without any disruptions to your life.

Other important points

Other important points to consider when intending to become a citizen of choice include the geographic location of the chosen country, its official language, political and economic stability, its legal system, the banking and business environment, visa-free travel availability for passport holders of that country, the reputation of the country and the passport, and of course initial and future overall costs.

Beware of illegal ‘programs’ and unqualified agents

The most important criterion for evaluating the usefulness of an alternative citizenship is that it be acquired in accordance with the constitution and laws of the issuing country, that is, it must be legal. Citizenship documents and passports obtained by illegal means such as bribery are unfortunately not uncommon. In many countries, it is possible to make illegal direct payments to corrupt government officials in return for passports and citizenship documents. Holders of such documents run a serious risk of exposure, arrest, and deportation. Even in those countries where there are actual provisions in the law, which give the prime minister, president, and/or other government ministers relatively wide discretion regarding the granting of citizenship, if any payment is involved, it constitutes as bribery, which is illegal all over the world. This discretion may and frequently does result in the revocation of previously granted citizenship and passports, for example, after a change of government. Persons who have acquired documents this way are also frequently blackmailed and forced to pay further ‘fees’ later on. It is therefore crucial that citizenship is obtained on the basis of specific provisions in the law and clear, official procedures.

Even in those countries that offer legal programs, one needs to be aware that in recent years, these nations have attracted all sorts of companies and agents, real estate developers and others who have been attracted by the success of some of the programs, notably the one in St. Kitts and Nevis, which has brought more than USD 1 billion to the country since the program was redesigned and internationally positioned by Henley & Partners in 2006­–2007. Very unfortunately, not all of these companies apply best business practices and today, extreme care must be exercised when selecting a lawyer, company, or choosing to buy real estate under one of the citizenship-by-investment programs. The only tightly regulated program in the world, with state-of-the art due diligence not only for applicants but also for agents promoting the program, is the Malta Individual Investor Program.

Henley & Partners can advise you

Henley & Partners is the only firm that has a true global presence and over 20 years of experience and overview to offer you real opportunities to acquire alternative citizenship on a sound legal basis. We are constantly up to date with many illegal "programs" that are frequently available online and through various agents, and we are the only firm to advise several governments on legal, policy, and operational aspects of citizenship-by-investment programs. Our highly qualified professionals work together as one team in over 30 offices worldwide.

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