In the world we live in today, nationality has become a commodity, and it becomes interesting to change citizenship, or have a second one, in order to be able to travel, save taxes, have an ace up your sleeve in case of crisis, or invest in certain places.
In today’s Centurion Capital guide piece, we will talk about the 5 most common legal ways to get a second citizenship. Keep in mind that there are countries that allow you to have dual citizenship and countries that do not.
This is something you should take into account beforehand before planning your strategy. In some cases it may not be important to give up your current nationality, but there are times when it is important. Keep this in mind.
Also keep in mind that there are countries, such as the United States, where having that nationality implies tax obligations even if you are not a resident of the country. The pros and cons of each country are something to look at very thoroughly before embarking on the adventure of second nationalities.
1. NATIONALITY BY INVESTMENT
Nationality by investment is one of the fastest ways to get a second passport, and is common in certain countries. The main barrier here is that you are required to invest a certain amount of money in the country, which can sometimes be a bit high.
However, if you are looking to get that nationality to do long term business in that territory, this can be a good way to “kill two birds with one stone”. When we talk about “investing” it is not about paying the government, but about using this money in the country, sometimes by opening a company, and sometimes by buying a property of a certain value, depending on each country.
Many times this involves an investment in real estate, business or government bonds. In most cases, this investment is a non-refundable donation made to the government of that country in order to obtain citizenship. In other words, it is nothing more than buying a second passport.
The time it takes to obtain a new nationality through this method ranges from two to six months, which varies depending on the program. Most of these countries do not require the applicant to travel or live in that country to become a citizen, which is a great advantage.
If you are an entrepreneur, investor or have good capital, a new nationality could represent quite a bit of money saved in taxes each year. The money invested in the second passport would become an investment that will not only bring you a return (ROI) in the short term, but will help you to legally retain more of your money for life and move more freely in your business and investments.
It should be noted that “citizenship by investment” is not the same as “residence permit by investment”. Since citizenship is what gives you a passport. However, the residence permit, although you can eventually get citizenship after living certain years in the country, is simply a permit to live there, like the famous “golden visas” of certain countries. This is often confused, and you should be clear about this.
Although it is a very effective and fast option to obtain your dual nationality; with investments starting from 100,000 USD and can go up to millions of dollars, it is a very expensive option for most people.
2. CITIZENSHIP BY DESCENT
Sometimes it happens that your ancestors (parents, grandparents, etc.) were from a certain country of which you are interested in having a passport. Many countries make it easy for you to obtain citizenship if you are a descendant of former citizens of that country.
A typical example is the American children or grandchildren of Irish emigrants, who are given facilities by the Irish government to obtain Irish nationality. In some cases, this ancestry can go back many more generations, such as the facilities that the Kingdom of Spain gives to Sephardic people to obtain Spanish nationality.
It’s precisely European countries that offer descendants of nationals an opportunity to gain citizenship. Italy, Spain, Poland, Lithuania, Latvia, Ireland, and Hungary, many nations allow people to claim for these benefits from second to third generation ancestors. Even Balkan countries have enacted these naturalization laws that offer a great pathway towards acquiring some of the most desired passports in the world.
Let’s paint you a picture: in South America (Argentina, Uruguay, Paraguay, Brazil) there is a large community of Italian descendants, who arrived in South America in the early twentieth century or after The Second World War. Most of them have acquired Italian passports.
It is estimated that in Paraguay 60% of the population has Italian origins, and most have Italian passports. But what is happening now? The exact opposite: many Italians are taking Paraguay’s passport.
It should be noted that there are also countries where, if a baby is born in their territory, it automatically obtains the nationality, such as the United States, Canada or Brazil, and in some cases this is also granted to the parents.
Undoubtedly, this option requires a bit of bureaucracy and time to gather all the necessary documents and go through the process, but in most cases, it is much easier and safer than the naturalization process.
The big disadvantage of this option is that it does not apply to everyone. Many of us do not have relatives from a foreign country.
3. NATIONALITY BY MARRIAGE
There are certain countries where, by the fact of marrying a person of that country, you can obtain the nationality. If you are married or plan to marry a foreign person, I recommend you to investigate the requirements to obtain the citizenship of your spouse’s country in order to take advantage of this great opportunity.
This is a double-edged sword, because regardless of the love that may exist between the two, you can have a hard time under investigation by the Immigration Department of the government of the day, as these laws give rise to many frauds and marriages of convenience.
It’s crucial to understand that just marrying a national of a country won’t automatically grant you with citizenship benefits. The truth is, there are many nations currently restricting this path towards citizenship due to the vast amount of fraud marriages out there.
In that sense, marrying a national will only fasten the process for a foreigner, adding to the cause and maybe aiding in the final decision of the authorities.
There are on the market strange persons who offer themselves for arranged marriages, or young women looking for husbands to obtain citizenship. In the US there are people who also pay 20,000 dollars to organize a fake wedding, which is absolutely forbidden. At no time do we intend to encourage this.
However, it is good to know that the marriage option exists and who knows? Maybe you will meet a special person from one of these countries and the laws will make it easy for you to spend your life together in their country.
If your spouse’s country does not represent a substantial advantage and on the contrary would bring you disadvantages, for example, at tax level, then it would not be a very good idea to apply for that nationality.
4. SPECIAL CITIZENSHIP: EXCEPTIONAL CASES
Certain professionals, such as athletes, millionaires, or renowned scientists, may be granted citizenship as part of special treatment by the government. There are even cases where the president of a country is empowered to “hand grant” citizenship to whomever he or she wishes.
To give an example of how this could work, we have the case of French actor Gérard Depardieu. He managed to obtain Russian citizenship from his friend, the one and only President Vladimir Putin, in just a few days. He did this at a time when he was in conflict with the French government lead by François Hollande, who enacted a 75% income supertax on wealth.
It’s a bit more complicated to get, if you don’t have special skills or very good contacts, but perhaps it might help you at some point to know that this possibility exists.
There are also other ways to obtain citizenships, although through somewhat unconventional methods. Let’s put the example of Austria to illustrate it. You could be interested in such a passport and could actually get it by donating 3 million EUR to the country. In a more extreme case, you could just start a company that will guarantee job creation for Austrians for as much as 10 million EUR.
Both of these options will virtually secure an Austrian passport for you, even when there are no laws that speak of it. Why? Because these kinds of actions are well received by governments and more than often offer a ticket into its bureaucratic system.
There are other countries also doing this. For example, New Zealand and Poland are known for bypassing usual requirements for citizenship when approached with big donations. If you are indeed able to convince authorities, the benefits attached to these passports are secured, no extra process needed.
However, the same cannot be said of most Western countries. There is the case of nations like Singapore that are in a constant search of artists and are more than willing to provide them with citizen benefits in exchange for cultural uplifting.
Qatar and Monaco, for example, offer a similar deal for athletes, especially when Olympic potential is detected. This we saw at the Tokyo Olympics,where not only Africans wore the Qatari flag, like Sudanese runners, but also Brazilian beach volleyball players, German boxers and Croatian handball players. Coming from 17 different locations, it proves how there are countries hungry for medals!
The key when thinking about this particular method is get to know cases of success. Check similar profiles of other capital holders and you’ll find out about so many countries that are willing to give out citizenships in exchange for business partners.
Perhaps this is the best known. When you spend some time (usually several years) in a country, you can choose to apply for nationality, this is known as naturalization.
For this, each country may ask for different requirements, from passing an exam (where you may be asked about articles of the constitution, to taking a language test) to having to spend time in the country. There are also countries where it is enough to simply prove how long you have been in the country administratively.
For this option, you must first obtain a residence and work permit in the second country. Then live and work in that country for the minimum time required, which typically ranges from 3 to 10 years, and comply with all the legal requirements of that country.
In many cases it would mean a complicated process, which includes learning a new language, integrating into a new society, contributing for a certain amount of periods to social security, learning about the country’s history to pass a citizenship test, etc.
Even though it is a good alternative for many people, the big disadvantage of this option is that it takes a long time, requires more effort and no one can give you the certainty that the policies and laws of naturalization will not change during the long process.
Additionally, even if you meet all the requirements, approval of your citizenship application is not guaranteed. In this case, all the years and efforts invested would be wasted. It is therefore necessary to wait several years before obtaining a passport for naturalization, in some cases over 10 years. But if you are looking for a quick solution, the fastest in the world is Paraguay as after only three years you can apply for naturalization.
In general, we can say that the longer the waiting time to submit the application and the longer the processing time, the higher the risk.
The key is to check beforehand the minimum time you may be asked to live in the country before being granted the nationality, as there are certain countries where this is quicker, and others where it may take more than a decade.
FINAL RACCOMENDATIONS FROM THE AUTHOR
Now that we have seen the options for getting a second passport, I ask you this: Do you really need a second passport? It is much easier to get a residence permit or visa in certain countries than it is to get a nationality.
This is because getting “a passport” is synonymous with getting the nationality, however a residence permit or visa allows you to live in the country, move freely, open businesses, work … that is, to do almost the same as a national, but in a simpler way.
In addition, many countries have tax advantages for people who, being foreigners, become residents (even tax residents) of the country, such as non-dom systems.
That being said, we cannot but encourage you to reach out to our team of experts and hear a second opinion about your financial objectives. We will be more than glad to aid you in finding the ideal mechanism for you to achieve your goals, from where it would be better to get a second passport to which fiscal residency suits you best.
Just contact us at Centurion Capitalist and will get back at you in no time!
Warning: The content of this article does not constitute legal or tax advice. It is provided for general informational purposes only and not for the purpose of offering any warranty or guarantee. As laws change frequently, personalized professional advice is absolutely necessary.
Article written by: Fabrice Barra is a cosmopolitan entrepreneur, lawyer, fiduciary and author, one of the world’s leading experts on offshore strategies, corporate haven, international investments and global mindset lifestyles. He is the personal trusted advisor of well-known entrepreneurs, UHNWI, Forbes Global 2000 companies, professional sportsmen, aristocrats, celebrities, investors, people with a net wealth of 7- to 8- or more figures, and he has access to a network of influential people around the world.