PM Costa says that Golden Visa has already fulfilled its function
In a mere decade (2012-2022), the Golden Visa scheme has managed to inject €5.87 billion into the Portuguese economy via real estate investment. Now the Portuguese Prime Minister, António Costa, is saying that the scheme has already met its financial targets and will soon no longer be necessary. It seems like the country wants to focus on less controversial visas, like the Digital Nomad Visa and brand-new Jobseeker Visa, and avoid the legal problems the Golden Visa can bring.
Why was the Golden Visa so controversial in the first place? The European Commission (EC) has been staunchly opposed to Golden Visas in any EU countries. Following the EC's pressure, Bulgaria terminated its Golden Visa in April 2022, and in September, Cyprus followed suit. The very same month, the European Commission announced that it would be taking Malta to court over their Golden Visa's breach of EU law.
The European Commission believes that a fast-track route to EU citizenship shouldn't be “bought” through Golden Visas. Indeed, it's the only type of visa in the EU whose eligibility criteria is purely financial. With a €500,000 investment in real estate, non-EU expats can become Portuguese residents and acquire freedom of movement through the entire Schengen area.
Golden Visa holders can apply for citizenship after 5 years like other types of expats. Here's the major difference, though: they need to have stayed in the country for only 7 days per year to become eligible for citizenship. That is only slightly over 1 month in 5 whole years. In the eyes of the European Commission, this is an unethical shortcut that is “objectionable from an ethical, legal and economic point of view.” These expats might have barely stayed in Portugal and might not have been active, culturally integrated members of its society at all.
Furthermore, the European Commission has raised the alarm that the Golden Visa application process does not screen these uber-wealthy's criminal backgrounds carefully enough. In September, for instance, it was discovered that a Chinese Golden Visa resident of Portugal, Feng Shen, was actually an ex-convict in China who had managed to get the visa using false credentials. There is also little screening of potential tax evasion and money laundering that can be committed by foreign billionaires who transfer their wealth into Portuguese real estate via the Golden Visa.
In an attempt to make the selection process more ethical, Portugal barred Russian and Belarussian billionaires from applying for the visa when Russia invaded Ukraine in March 2022. It was a way to ensure that its local laws were not in contradiction with EU sanctions of Russia.
However, Russian/Belarusian applicants are only a minority of all Golden Visa applicants. Half of all Golden Visa holders are Chinese, followed by wealthy Brazilians, South Africans, Turks, Americans and Angolans. Their visas still present legal risk. To avoid being dragged to the European Court of Justice like Malta, Portugal now seems to prefer terminating this visa altogether.
