Latvian immigrant investor scheme may close after Presidential intervention

If you are interested in the Latvian immigrant investor scheme, call us in London on +44 (0)344 991 9222 or in Riga on(+371) 6 781 4120 or email us at riga@workpermit.com

There are fears that the Latvian Immigrant Investor visa may close altogether following intervention by the Latvian President Andris Berzins. Mr Berzins has sent a bill, which would result in significant changes to the Latvian Immigrant Investor visa programme, back to the Latvian parliament, the Saiema, for 'reconsideration'. Mr Berzins says that the law contains 'obvious contradictions'.

The first applications for immigrant investor visas were received in July 2010. Since then over 7,000 visas have been issued, largely to wealthy Russians who are keen to benefit from visa-free travel to the European Union.

Latvia is part of the EU and also part of the Schengen Area, an area covering most of Western Europe in which internal border controls have been abolished. The holder of a Latvian Immigrant Investor visa can spend 90 days in every six months anywhere in the EU,

Five year residence permits

Latvian Immigrant Investor visas allow their holders to reside in Latvia for five years. The holder must register with the Latvian police once a year.

In 2013, the National Alliance, a right-wing nationalist party which is part of the ruling coalition objected to the granting of the visas on several grounds. They said that the visa by encouraging foreign investment in Latvian property resulted in increased property prices thereby putting property ownership beyond the reach of many Latvians.

On 31st October 2013, the Saiema approved amendments to the Immigrant Investor Program designed to cut the number of visas granted; The money would be used to build affordable properties for Latvians who cannot afford to buy their own homes. The new law provided that

  • In 2014, a maximum of only 800 immigrant investor visas would be issued.
    • 700 visas would be available for those purchasing real estate worth at least €150,000 (105,000 Latvian Lats, £127000, US$202,500). (This number would fall to 525 in 2015 and to 350 in 2016
    • A further 100 visas would be available for those who purchase real estate worth at least €500,000 (LVL351,000, £423,400, US$675,000)
  • The fee for a visa would rise from LVL70 to €50,000. The proceeds would be used to fund new housing projects

Schemes existence in question

However, the continuing existence of the scheme has been thrown into doubt. Mr Berzins has refused to sign the new law and has sent it back to the Saiema for reconsideration. Mr Berzins is still concerned that even with the proposed changes the scheme will cause property prices to rise in Latvia. He is said to believe that the scheme focuses too heavily on real estate purchase when it should instead encourage business investment and job creation.

He is not alone. The 'beyond-brics' blog on the Financial Times website reports that Dainis Gaspuitis, chief economist at SEB in Latvia says that the scheme has been of limited benefit to the Latvian economy, with estate agents and property dealers receiving most of the rewards.

Current outcome 'not brilliant'

He said 'The current outcome of the review of the programme is not brilliant. The lion's share of investment went into the real estate sector'.

Mr Gaspuitis adds 'the emphasis should be shifted towards investing in the productive sectors'. It remains to be seen how easy this will be in practice. One of the reasons why people are attracted to property investments is that it is seen to be a safer investment than many other types of investment.

Sanwar Ali of workpermit.com said 'If you have been considering applying for a Latvian immigrant investment visa then you should do so now. The scheme will either close or will most likely be more expensive in future."

If you are interested in the Latvian immigrant investor scheme, call us in London on +44 (0)344 991 9222 or in Riga on (+371) 6 781 4120 or email us at riga@workpermit.com

If you would like to apply for a visa WorkPermit.com can help. WorkPermit.com is a specialist visa consultancy with 25 years of experience dealing with visa applications. We can help with a wide range of visa applications to your country of choice. Please feel free to contact us for further details.