The Irish IIPs Contribution to the Emerald Isle’s Economy
Ireland has issued over 700 residence permits under the Immigrant Investor Programme. What impact has it had on the local economy? On relations with foreign markets? Is the Irish IIP a viable route to Irish citizenship? We explore the intangible benefits of the Irish IIP on the Emerald Isle’s economy from a birds view perspective.
In 2018 a total of 420 Applications were received under the Irish Immigrant Investor Programme (IIP). 45 Applications were approved, 3 were refused and 15 were withdrawn. Six years since the Irish IIP was first launched in 2012, over 700 applications have been approved, drawing in an influx of over EUR 500 Million to the Irish economy.
Since 2018 though, the Irish IIP, overseen by INIS (Irish Naturalisation and Immigration Service) has been under pressure from the European Commission (EC) and Organisation for Economic Cooperation and Development (OECD) to improve the transparency of its programme and enhance due diligence.
ENHANCED DUE DILIGENCE & BOTTLE NECKS
As we saw earlier this year, in January 2019 the European Commission issued a (slightly inaccurate) report further criticising citizenship and residency programmes, heightening the need to enforce more robust due diligence and screening efforts.
Ireland took heed, as was evidenced by:
- their ongoing commitment to share tax data in line with OECD common reporting standards (implemented since 2016 in Ireland); and
- the tighter due diligence processes put in place for IIP applicants such as enhanced AML, KYC, PEP and sanction screening.
Whilst this has bolstered the Irish IIP’s compliance standards it has also resulted in greater bottlenecks in processing times for IIP applicants which are taking 12 or more months in many cases.
MEASURING THE INTANGIBLE BENEFITS OF RESIDENCY SCHEMES
Nonetheless, the Chinese demand for the Irish IIP has remained steadfast.
Chinese applicants still make up approximately 9/10 investors, opting for the Enterprise route over other modes of entry. The Irish IIP’s foreign investment has gone predominantly into the hotel, nursing home and social housing sectors.
Yet the benefits of residency programmes extend far beyond the Euro value of foreign investment they attract. As such, investment migration programmes should never be analysed in isolation, calculating purely stats on the applicants and their investments.
THE OBJECTIVES OF THE IRISH IIP
As highlighted in the recent report issued by the IGEES, the Interim Evaluation of the Immigrant Investor Program, the key objectives of the Irish IIP are to:
- attract foreign direct investment;
- create jobs; and
- generate positive spillovers for the economy including access to new foreign markets.
Whilst it will always be difficult to pinpoint the precise impact investment migration has on the local labour market and accurately quantify the trade and foreign relations benefits a residency programme brings to a host country, we can, in the Irish case, identify a very clear improvement in Sino-Irish relations.
THE WIDER IMPACT OF THE IIP ON SINO-IRISH RELATIONS
In 1979 China and Ireland established diplomatic relations. Thanks to the efforts of their respective diplomatic offices, investment promotion agencies and academic institutions, ties between these two countries have since been growing stronger.
Read More: IRISH INVESTOR IMMIGRATION PROGRAM SOUGHT BY CHINESE HNWI
Several tradeshows and summits (e.g the Sino-European Enterprises Summit ‘19), commercial partnerships and investment promotion efforts at various levels have resulted in the Chinese affluent classes becoming ever more aware of the business-friendly environment and investment potential Ireland offers.
This increased familiarity has also meant increased Chinese investment (both within and outside the realms of the IIP) in the Emerald Isle’s economy. An economy that has recently been undergoing a major transformation, making it truly shine in stark contrast to its darker years of scarcity not so long ago.
A STEPPING STONE TO CITIZENSHIP
Not only has Ireland been drawing Chinese investors due to the benefits of its residency programme but also because it his home to some of the world’s top tier academic institutions. Children’s education features as one of the main motivations Chinese investors have when applying for the Irish IIP. As an added incentive, Irish IIP applicants also get to avail a EUR 50,000 ‘discount’ if they enrol one of their dependent children in an Irish university.
In contrast to other residency programmes, such as the Portugal Golden Visa, applicants must actually be physically present in Ireland if they wish to use the IIP as a stepping stone to citizenship.
Hence, most applicants will physically leave their home countries and relocate with their spouse and children.
RULINGS AND APPEALS
Ireland has issued over 700 residence permits under the Immigrant Investor Programme. What impact has it had on the local economy? On relations with foreign markets? Is the Irish IIP a viable route to Irish citizenship? We explore the intangible benefits of the Irish IIP on the Emerald Isle’s economy from a birds view perspective.
In 2018 a total of 420 Applications were received under the Irish Immigrant Investor Programme (IIP). 45 Applications were approved, 3 were refused and 15 were withdrawn. Six years since the Irish IIP was first launched in 2012, over 700 applications have been approved, drawing in an influx of over EUR 500 Million to the Irish economy.
Since 2018 though, the Irish IIP, overseen by INIS (Irish Naturalisation and Immigration Service) has been under pressure from the European Commission (EC) and Organisation for Economic Cooperation and Development (OECD) to improve the transparency of its programme and enhance due diligence.
ENHANCED DUE DILIGENCE & BOTTLE NECKS
As we saw earlier this year, in January 2019 the European Commission issued a (slightly inaccurate) report further criticising citizenship and residency programmes, heightening the need to enforce more robust due diligence and screening efforts.
Ireland took heed, as was evidenced by:
- their ongoing commitment to share tax data in line with OECD common reporting standards (implemented since 2016 in Ireland); and
- the tighter due diligence processes put in place for IIP applicants such as enhanced AML, KYC, PEP and sanction screening.
Whilst this has bolstered the Irish IIP’s compliance standards it has also resulted in greater bottlenecks in processing times for IIP applicants which are taking 12 or more months in many cases.
MEASURING THE INTANGIBLE BENEFITS OF RESIDENCY SCHEMES
Nonetheless, the Chinese demand for the Irish IIP has remained steadfast.
Chinese applicants still make up approximately 9/10 investors, opting for the Enterprise route over other modes of entry. The Irish IIP’s foreign investment has gone predominantly into the hotel, nursing home and social housing sectors.
Yet the benefits of residency programmes extend far beyond the Euro value of foreign investment they attract. As such, investment migration programmes should never be analysed in isolation, calculating purely stats on the applicants and their investments.
THE OBJECTIVES OF THE IRISH IIP
As highlighted in the recent report issued by the IGEES, the Interim Evaluation of the Immigrant Investor Program, the key objectives of the Irish IIP are to:
- attract foreign direct investment;
- create jobs; and
- generate positive spillovers for the economy including access to new foreign markets.
Whilst it will always be difficult to pinpoint the precise impact investment migration has on the local labour market and accurately quantify the trade and foreign relations benefits a residency programme brings to a host country, we can, in the Irish case, identify a very clear improvement in Sino-Irish relations.
THE WIDER IMPACT OF THE IIP ON SINO-IRISH RELATIONS
In 1979 China and Ireland established diplomatic relations. Thanks to the efforts of their respective diplomatic offices, investment promotion agencies and academic institutions, ties between these two countries have since been growing stronger.
Read More: IRISH INVESTOR IMMIGRATION PROGRAM SOUGHT BY CHINESE HNWI
Several tradeshows and summits (e.g the Sino-European Enterprises Summit ‘19), commercial partnerships and investment promotion efforts at various levels have resulted in the Chinese affluent classes becoming ever more aware of the business-friendly environment and investment potential Ireland offers.
This increased familiarity has also meant increased Chinese investment (both within and outside the realms of the IIP) in the Emerald Isle’s economy. An economy that has recently been undergoing a major transformation, making it truly shine in stark contrast to its darker years of scarcity not so long ago.
A STEPPING STONE TO CITIZENSHIP
Not only has Ireland been drawing Chinese investors due to the benefits of its residency programme but also because it his home to some of the world’s top tier academic institutions. Children’s education features as one of the main motivations Chinese investors have when applying for the Irish IIP. As an added incentive, Irish IIP applicants also get to avail a EUR 50,000 ‘discount’ if they enrol one of their dependent children in an Irish university.
In contrast to other residency programmes, such as the Portugal Golden Visa, applicants must actually be physically present in Ireland if they wish to use the IIP as a stepping stone to citizenship.
Hence, most applicants will physically leave their home countries and relocate with their spouse and children.
RULINGS AND APPEALS
To qualify for Irish citizenship, the required period of actual residence is 5 out of 9 years, with the last 12 months prior to submitting the application, as continuous reckonable residence. Up until now, there had been no clarity on what 12 months of continuous reckonable residence meant.
In practice, the Department of Justice and Equality had been deeming eligible applicants who had had up to 6 weeks of absence in the 12 months preceding their citizenship application due to holiday/personal reasons.
Yet, earlier this year, Justice Barret stirred up citizenship applicants’ nerves when he ruled that it was mandatory for applicants to have “a one-year period or residence in Ireland that is ‘unbroken, uninterrupted, connected throughout space or time”.
What ensued was a period of great anxiety for foreign nationals who had already submitted their citizenship applications and hadn’t meet this stringent ‘no-break’ requirement.
Yet, this November there was a positive development for the industry. The Court of Appeal overturned Justice Barret’s rigid ruling and agreed that the Department of Justice and Equality’s practice (6 weeks of absence) was “reasonable”.
This has given much needed clarity for immigration professionals and residency permit holders, including those who are looking to obtain Irish citizenship via the Irish IIP, as they now know what the requirements are for them to obtain their Irish passport.
Originally published at https://civitaspost.com/
