Portugal ends its Golden Visa program: What it means for investors
Updated: Mar 25
For years, the Portugal Golden Visa program has been a popular option for non-EU citizens seeking residency in the country. The program grants residency to investors who meet certain criteria and has been a boom for Portugal's economy, bringing in millions of euros in investment each year.
However, following a ministerial meeting held on 16 February 2023, the Portuguese government presented a package of measures to respond to various concerns within the scope of the housing policy in Portugal. It was in this context that the measure of apparently ending the Portugal Golden Visa program was grafted.
What is the Portuguese Golden Visa?
The Portugal Golden Visa program is a residency-by-investment scheme that has become increasingly popular among foreign investors. This program provides a number of benefits to those who qualify, including the right to live, work, and study in Portugal, as well as free movement within the European Union and Europe’s Schengen Area.
One of the top benefits of the program is its affordable investment options, which start from €250,000. This makes it a more accessible option compared to similar programs in other countries. Additionally, investors who keep their qualifying investment for at least five years can potentially become permanent residents or even Portuguese citizens.
Another major advantage of the Portugal Golden Visa program is the access it provides to the EU and visa-free travel to 172 nations. This is particularly valuable for investors who conduct business across borders or travel frequently for personal reasons.
Investors in the program also have the opportunity to become non-habitual residents and pay little to no tax for 10 years. This can be a significant financial benefit for high net worth individuals who are looking to optimize their tax liabilities.
What will happen to the Portuguese Golden Visa in 2023?
The Portuguese Government announced on 16 February 2023 that it will end its golden visa program. The announcement marked the start of a phase of intentions in which the government is submitting these measures to public scrutiny from a political point of view. It is expected that at this time the main stakeholders in all industries affected by the measures will be heard, in order for them to give their perspective of the positive or negative impact that each one of the measures will have.
Following this period of public consultation, the Council of Ministers will meet again and approve its final version of the package of measures on 16 March 2023. Here it is important to note that in this sequence, the measures will take two different directions: one part of the bill will be immediately approved and will follow the path of a legal diploma approved by the government. The other part will be submitted to the Parliament, as is the case with all provisions regarding the entry and exit of foreigners in Portugal, namely the Golden Visa.
In other words, in the days following this new communication of March 16th, the text of the Government's bill on the various matters will be known, and it is here that the discussion of the true content and scope of the measures begins. This bill follows the traditional path of being voted on generically, discussed in specialized commissions, expectantly in the constitutional affairs commission, the relevant social partners will be consulted through requests for an opinion, major or minor amendment proposals will be presented by the various parties with a parliamentary seat, and in the end, a vote will be taken on the final version of the text by the General Assembly.
Once the final version of the text has been approved, it will be sent to the President of the Republic, who can immediately send it for publication or can question it, from a political point of view, returning it to the Assembly with the notes that he deems to justify a review, or from a legal perspective, sending it to the Constitutional Court to assess its conformity with the Constitution. Only after all these procedures have been completed can the proposed law be sent for publication and thus be entered into force.
It should be noted that the law may determine different periods of the so-called vacatio legis for each of its matters. That is, the different measures resulting from the law can start to be applied at different times, more or less extended in time.
The legislative processes that take place in the Assembly of the Republic have the enormous advantage of being highly transparent, allowing for their progress and various discussions to be followed, which will bring stability and allow all stakeholders to adjust expectations and act accordingly.
I am currently enrolled in the Golden Visa process, what should I do?
We understand that communications of this nature generate uncertainty and anxiety, so it is essential to maintain serenity and discernment. We are committed to analyzing the position each client is in within their investment cycle and proceed with the application, benefiting from the legislation which is still in force. Any decisions can be analyzed and questioned from a political or legal point of view, and this must be done appropriately, with consistency and seriousness. Until the new legislation is passed and comes into effect, investors can still benefit from the existing program and apply for residency in Portugal.
For those who are already invested in the Portugal Golden Visa program, it is important to monitor the situation closely and seek professional advice to understand the potential impacts of the changes. For future investors, there may be alternative pathways to obtain residency in Portugal, such as the Non-Habitual Residency program or other types of investment visas.
Overall, while the Portugal Golden Visa program has been a popular option for investors seeking residency in the country, it is important to note that the government's decision to end the program is part of a larger package of measures to respond to various concerns within the scope of the housing policy in Portugal. The legislative process is still ongoing, and it is important to stay informed and seek professional advice to make informed investment decisions.