Economic Citizenship Or Dominican Republic Investor Process?
When trying to make a comparison between the process
available in the Dominican Republic and some other
jurisdictions, we have already noted that the Dominican
Republic does NOT
have an instant or economic citizenship program (in fact,
they never did). However, there is a process for
qualified investors that allows you to apply for citizenship
after 6 months of obtaining a special residency status card
from immigration (which we will explain below). All
told, if you add up the various time lines, the entire
process will usually take about 18 to 24 months (all
depending upon the various government offices). So,
while it is not an instant or economic citizenship as might
be offered elsewhere, it costs MUCH
LESS than such programs in other countries and
there are no restrictions placed upon you.
Because the Dominican Republic is one of the most beautiful
countries in the Caribbean, and currently still has some of
the lowest priced real estate in comparison to other
Caribbean destinations, it is a country of choice for many
people - - and it has earned a reputation as one of
the best places to live or retire. In addition,
banking in US Dollar and Euros is available, plus with local
currency investment rates up to 16%, it means that investors
can enjoy a very comfortable income from their investments,
from a relatively small investment. As part of our
core group of services, or included in the residency fee, is
our personal assistance with banking and investment account
introductions for our clients (we gladly take clients to
visit some of the local financial institutions and introduce
them to an English speaking account officer, but we have NO
referral arrangement with any bank or brokerage firm – and
clients certainly are under no obligation to work with any
of the institutions we might suggest). In addition, we
certainly do not manage money or act as signatories on any
accounts, but we do provide any advice and assistance we can
otherwise. After all, it is YOUR money and not ours,
and you should be the only person in control of it.
Why
Choose The Dominican Republic For Residency or Citizenship
?
Some
Key Points About The Dominican Republic:
1.
The Dominican Republic Fully Recognizes Dual Citizenship.
You will NOT be asked at any time to renounce your
previous citizenship or turn in your previous passport,
and the Dominican Republic respects the fact that you
might be a dual citizenship accordingly.
2.
The Dominican Republic Offers Investors Some of The Lowest
Priced Real Estate in The Caribbean. Per
square foot, real estate costs tend to be lower in the
Dominican Republic or stated another way: You will get
MORE for your money in terms of a real estate purchase in
comparison to most other jurisdictions in the
Caribbean. Also, because the mortgage interest rates
are high (according to market conditions) and NOT
artificially manipulated by the central bank, as is the case
in the United States, the country has not fallen into a real
estate crisis as we have seen in the US and parts of Europe
(Spain, Ireland). In other words, real estate in the
local markets has not declined and local Dominican Banks are
not under water with abandoned properties or non-performing
mortgages. This means that the real estate market
remains on solid footing in the Dominican Republic.
3.
The Dominican Republic Offers Banking in US Dollars, Euros
and The Dominican Peso. In addition, interest
rates tend to be higher in the country than Panama or the US
for US Dollar denominated Bonds or Commercial Paper.
Should investors wish to consider placing monies into
Dominican Peso denominated investments, then in such a case,
as of June 2014 investors can expect up to 14 percent
(annualized) or so with some longer term bonds or commercial
paper vehicles. In other words, with a US$150,000
equivalent in Pesos invested this way, one can expect about
US$1,800 or RD$75,000 Pesos per MONTH in interest.
This certainly is enough monthly income from investments to
cover your monthly RENT in an upscale apartment, your
monthly utilities (Electricity, Telephone, Cable Television,
Etc,), And your monthly grocery bill - plus have something
extra left over.
Speaking about banking matters, it is also important to note
that the Dominican Republic does NOT
have any currency controls. You can bring in any
amount of money you want, take out any amount of money you
want - and exchange between US Dollars, Euros and Dominican
Pesos any day as much as you want all within the same
bank. Of course, each bank has their own due diligence
policy and may ask to see source or proof of funds regarding
your first wire transfer or for an unusually large wire
transfer, but that is only a bank's policy and has nothing
do with any law in the country prohibiting you to receive or
take out money. Also, as of JUNE 2014, the retail
banking unit of the Dominican Central Bank will accept and
conduct transactions in the Chinese Yuan Renminbi
Currency. This means the other local banks in the
country will probably be offering savings accounts and or
other transactions in that currency soon as well.
4.
The Dominican Passport Offers Visa Free Travel To The
Following Countries (as of 2012 according to the
Dominican Foreign Relations Office): Cuba, Ecuador, Egypt,
The Philippines, Georgia, Hong Kong, Japan, South Korea,
Israel, Morocco, Mozambique, Lebanon, South Africa, St.
Kitts - Nevis, Trinidad - Tobago, Turkey, Tunisia and
Singapore. Travelers with a Dominican Passport may
transit the Following Countries without a Visa:
Germany, Spain. There are additional countries
offering visa free travel to Dominican Passport Holders, but
we have not mentioned them because the foreign relations
department did not list them on their official communication
sheet.
5.
The Dominican Republic Offers a Very Attractive
Alternative To Economic Citizenship Programs elsewhere,
Which is to explain, persons wishing to apply as qualified
investors have the opportunity to apply for naturalized
citizenship after 6 months and here are some comparison to
the economic citizenship programs in other other countries:
Some
Economic Citizenship Programs require that you GIVE
US$100,000 to that local government to qualify or
purchase real estate valued at US$300,000 or more. The
US$100,000 donation is money you will NEVER see again
- it is gone, kaput, vanished like a magician's trick.
In the Dominican Republic, if you invest US$200,000 you are
under no restriction as to how or where you invest it.
You can put into government bonds, commercial paper, real
estate, whatever - and the money is YOURS,
ALWAYS AND FOREVER. You can move it around,
change your investments, and take it out later on if you so
choose.
With regards to the real estate option with these other
Economic Citizenship Programs, the local government is
telling you where you MUST buy in order to qualify, and
usually these are not properties you would buy on your own
(which are not really worth the money, and good luck trying
to sell it for that amount later on). In the Dominican
Republic there are NO
RESTRICTIONS as to what you buy, where you buy and
at what price you buy. If you find a nice 2,000 square
foot luxury condo for US$200,000 then buy it, as it will
qualify as an investment towards the US$200,000
amount. Want to buy a high end one bedroom condo in a
building with a door-man, swimming pool, etc, for US$120,000
and put your other money into other interest paying
investments giving you a monthly income, feel free to do
so. That also will qualify.
Just to be clear, there are TWO different Residency
Application avenues and depending upon which one you choose,
that will determine how far off or how quickly you can apply
for citizenship:
Dominican Republic Ordinary Residency Application Process
This process was recently changed by a law passed on October
18, 2011 by President Fernandez of the Dominican Republic
(who was President at that time). As a result, the
process now requires 5 years of Provisional Residency and 2
years of Definitive or Permanent Residency before you can
apply for citizenship (a total of 7 years altogether).
Applicants would apply with the Dominican Republic
Department of Immigration for Provisional Residency as the
first residency category. This card will normally be
issued with a one year expiration although immigration will
issue a card with extended years as the expiration if the
applicant is willing to pay for the corresponding future
years up front. Remember, in accordance with the new
law of 2011, applicants would maintain provisional residency
status for 5 years total, before being able to convert their
status to Ordinary Definitive or Permanent Residency, and
then after 2 years of Definitive or Permanent Residency, you
could apply for citizenship.
The positive side to this process is that NO investment is
required, other than proof of a local bank account (with no
amount in the account specified). This process is
probably more appealing to clients that would prefer not to
make any kind of larger investment in the country and that
may not be in a rush to obtain a dual citizenship.
Indeed, many of our clients coming from Europe or Canada
might prefer this, as the goal for such persons is to be
able to declare themselves non-resident for tax purposes in
the previous home country, more so than a desire for dual
citizenship (However, if your goal is a legal and valid dual
citizenship and passport, then the following will be of
interest to you).
Dominican Republic Definitive or Permanent Residency
As a Special Qualified Investor
Prior
to 2007, President Fernandez (who was the President of the
Dominican Republic at that time) wanted to offer a program
for retirees or pensioners as existed in places such as
Panama or Costa Rica. Seeing the interest and success
in such programs, a decree was issued creating such a
program in the Dominican Republic – albeit with a number of
improvements in terms of requirements over the other
countries mentioned. However, in 2007 a formal law was
created making this program an official codified process,
but with some additional categories as well. These
categories falling under the same special law are:
A. Pensioner or Retiree – With a fixed Monthly Retirement
Income, Pension or Annuity. B. Independent Investor –
With Proof of Monthly Income coming from any investment or
non salaried source (meaning bank account interest,
brokerage accounts, rental income, royalties, etc.).
C. Lump Sum Investor – With Proof of a local investment of
US$200,000 (or equivalent in another currency) in local
financial instruments, real estate, business enterprise,
etc.
In order to qualify for this special status regardless of A,
B or C, there is NO age requirement (as is the case in some
other jurisdiction if applying as a pensioner or retiree),
with obviously the time line of eligibility for naturalized
citizenship application shortened down to 6 months from the
date your investor residency card is issued. Over the
past few years roughly 90 percent of our clients have been
able to participate in this program and we would be glad to
assist you as well. One of the positive aspects however is
that unlike in some other jurisdictions, there is NO
requirement for the applicant to invest in real estate,
although you are welcome to do so should you wish – and keep
in mind that this will allow you to file for naturalized
citizenship under that qualifier. Also, the Dominican
Republic has been and still is a real estate investor's
paradise because per square foot, you will get more for your
money in the Dominican Republic compared to just about any
place else in all of the Caribbean (from basic properties up
to luxury condominiums or homes). In fact, over the
past 10 years, many of our clients have already doubled
their money in some cases with regards to real estate
investments – and are still buying now in 2014 because real
estate holdings are a hedge against inflation and possible
devaluation of the US Dollar – AND is still reasonably
priced compared to similar properties elsewhere (compared to
St. Martin, Bahamas, etc.).
But not only that. Persons applying under the above
mentioned special investor residency process also can obtain
a reduction on title transfer taxes for their first real
estate purchase, AND annual real estate taxes are quite low
in general compared to the US, Europe, etc. In terms
of annual real estate taxes in the Dominican Republic : You
can expect to pay one (1) percent of the property value,
calculated for the amount over and above US$100,000 (real
estate valued at the Peso Equivalent of US$100,000 and below
is tax-free in terms of any annual real estate taxes).
In terms of some general real estate information and how it
relates to the application process (for residency and
citizenship) - there is no specific or fixed amount they are
looking for or requiring in terms of a real estate
purchase, so it is up to you what you might
consider. Real estate in Santo Domingo or Santiago
will be less expensive than property in a tourist area
such as Juan Dolio or Punta Cana. With regards
to Santo Domingo, you can find a higher end 3 bedroom
condo (in an upper middle class area) ranging from say
US$145,000 for a 1,400 square foot property up to
US$250,000 for maybe a 2,400 square foot property -
and everything and anything in between. Outside of
Santo Domingo, there is a builder doing Swiss chalet style
vacation properties in the mountain area of Jarabacoa (new
construction) for about US$125,000. In addition, you
can get a 2 or 3 bedroom townhouse condo in Punta Cana –
Bavaro for about US$125,000 but it will be smaller
(about 1,200 square feet or so).
Regardless of which of the above application scenarios may
be best applicable for yourself, our office can assist with
the initial residency application all the way through to the
citizenship process and passport. Over the last 16
years we have assisted many families and individuals, and
would be glad to be of service to you as well.
GETTING
STARTED:
Regardless if you intend to apply as an ORDINARY RESIDENT
APPLICANT or QUALIFIED INVESTOR APPLICANT, immigration has
started to insist as of June 2012 that potential applicants
obtain a special residency visa from their nearest Dominican
Consulate as the first step (the second step would be a
visit to the Dominican Republic to start the actual process
with immigration). You should be aware that this is
NOT a new law or requirement, but rather one that has been
in place for many years. However, The Dominican
Department of Immigration did not enforce this provision
previously, that is until they started doing so in June of
2012. So, we can call this visa in your passport the
first step in the process, and then the actual filing
process with the Dominican Department of Immigration in
Santo Domingo as the second step.
Our office assists clients with both the first and second
step, and to make sure clients have everything correctly
prepared, we ask that they send us one original set of
documents before they apply for the visa. This is so
we can check the documents to make sure they are in order,
and to prepare a document for the client whereby someone is
our office is acting as a guarantor (A Dominican Citizen
must as a guarantor for the visa application and the
residency application with immigration). In addition,
we can provide a complete documents list and templates for
some of the documents as well. Once clients obtain the
special residency visa which is valid for 60 days, then they
will visit Santo Domingo to begin the actual process with
the department of immigration and we will be with our
clients every step of the way through approval and issuance
of the respective cards. In addition, we of course
assist with the naturalized citizenship process for our
clients, and we have been doing so for over 16 years to
date.