The member countries of the Organisation of Eastern Caribbean States (OECS) that offer citizenship by investment programs (CBIPs) have passed legislation to maintain the credibility of their CBIPs, with the support of the government of the Commonwealth of Dominica.
The four OECS countries signed the Memorandum of Understanding (MoU) – Antigua and Barbuda, Dominica, Grenada, and St Kitts and Nevis – during a virtual signing ceremony on Wednesday, March 20th, 2024. As part of this landmark pact, a minimum CBIP price threshold of US$200,000 was set, highlighting the determination of Caribbean CBI countries to reinforce their commitment and sustain open communication with international partners.
Out of all the countries, Saint Lucia is the only one that has not yet agreed to the Memorandum of Agreement (MoA) signed on March 20th, 2024. The upcoming increase in prices will be implemented on June 30th, 2024. However, this does not imply that Saint Lucia’s Citizenship by Investment program will never adapt to the evolving climate. At present, it will continue to function within its existing framework.
Dominica sets the standard for CBIP integrity
Leading the movement on these amendments was the Commonwealth of Dominica, whose Prime Minister, the Honourable Dr. Roosevelt Skerrit, announced in advance of his press conference on Tuesday that he had signed the agreed-upon modifications. Dominica keeps showing signs of being open to improving and preserving the Citizenship by Investment program’s integrity. As said during the press conference, Honourable Dr. Skerrit clarified that the Caribbean CBI nations will collaborate to respond to inquiries from the European Union (EU) about CBI and Schengen area visa exemptions. According to Honourable Dr. Skerrit, CBI nations are still working to improve the CBIPs’ integrity.
International Scrutiny
From 2017 to 2022, there was intense competition among Caribbean Citizenship by investment programs in the OECS, leading to a decrease in investment choices and global attention. Recently, the European Commission, the UK government, the FATF, and other organizations have voiced concerns about flaws and loopholes that call into question the standards of screening and the corruption associated with citizenship through investment schemes, the sale of passports without a valid connection, name changes, laundering of funds, and tax evasion. Caribbean CIPs have come “under fire” after the European Commission implemented a mechanism to suspend visa waivers for third-country nationals who had visa-free access to the EU, citing concerns about Member States’ internal security about citizens of those nations purchasing second citizenship and passports with inadequate security checks. Vanuatu and Dominica were hit with a suspension of their visa waiver in 2023.
The Rise in Citizenship by Investment Prices
Raising the minimum investment level is a result of several nations working together to improve the quality of their citizenship through investment initiatives and guarantee their long-term viability. The CBI countries want to increase trust among investors and other interested parties while strengthening the integrity of their programs through more transparency and cooperation. It is unclear whether the Schengen area of the EU will acknowledge and value these initiatives.
Investors who are used to lower thresholds may be concerned by this significant price increase. The objective of attracting investors is to bring in dedicated individuals who are certainly interested in contributing to the economic progress of these nations.
Additionally, this allows the CBI countries to redefine themselves as attractive destinations for high-quality investments. By strengthening their due diligence, monitoring, and reporting systems, these countries can stand out in the global market of CBI programs, not just locally but internationally.
For licensed agents working in this dynamic environment, it will be imperative to adjust to the changing dynamics of the sector. In order to effectively navigate the shift towards increased investment limits and heightened transparency standards, agents will need to reevaluate their approaches and products.
In this new era of CBI programs, the utmost professionalism will be crucial. CBI Professionals have the responsibility to ensure that this shift goes as smoothly as possible by fostering client trust via open communication and maintaining high-quality services.
The upcoming surge in investment signifies an important shift in the landscape of the sector. It is imperative that all parties involved see this as an opportunity for progress, not just for the economy of each dual citizenship program country but also for the improvement of each program and the services provided to investors.
The Caribbean nations are laying the foundation for the Caribbean’s CBI industry to become more resilient and prestigious over time.
Common Standards on Regulating CIPs
The four nations, as per the Memorandum of Agreement dated March 20, 2024, also agree to:
- Provide details about CBIP applicants.
- To ensure greater transparency, we can introduce measures like disclosing funds received by CBIPs, monitoring the use of CBIs’ proceeds, and conducting independent audits to evaluate compliance with best practice standards.
- Designate a competent authority at the regional level to establish and enforce CBIP standards based on international requirements and best practices.
- Implement uniform guidelines for overseeing the communication and promotion of the CBIPs.
- Establish shared criteria for governing agents in the CBIPs.
- Help the relevant officials and agencies in charge of administering CBIPs by organizing collaborative training programs and capacity-building activities.
The law establishes minimum pricing structures, standardizes information sharing amongst CBIPs, and ensures that no applicant may submit an application for citizenship below a specific fixed rate. According to Honourable Dr. Skerrit, these actions would put everyone in a much stronger position in terms of their response to the concerns raised by the EU.
