Portugal has announced amendments to its golden visa program that will come into force from January 2022. The significance of this decree is that it defers the exclusion of Lisbon and Porto from the golden visa program from July 2021 to January 2022.
Other changes include changes to the minimum investment required under the Capital Transfer option for golden visa investors.
About Portugal’s Golden Visa Program
Portugal offers eight different investment options and any investor fulfilling one of these requirements can qualify for permanent residence in Portugal by living in Portugal for just seven days in the first two years and for 14 days for subsequent periods.
The most popular investment option is the €500,000 investment in property in Portugal. An investor opting to rehabilitate a property that was constructed more than 30 years ago needs to invest just €350,000.
After real estate, the next preferred option is the capital transfer route where the applicant must invest capital either into a Portuguese company or institutions or funds as mandated by the program’s rules.
Increase in Minimum Investments
Capital Transfer into Portugal
- Increased from €1 million to €1.5 million.
Capital transfer for use in research activities of public or private scientific research institutions in Portugal
- Increased from €350,000 to €500,000.
Capital transfer into investment funds or venture capital funds with 60 percent investments into companies registered in Portugal and the applicant to hold the investment for a period of five years
- Increased from €350,000 to €500,000.
Capital transfer into a new or existing company registered in Portugal and creation or maintenance of at least five jobs for a period of three years.
- Increased from €350,000 to €500,000.
Exclusion of Lisbon and Porto
Golden visa investments will be permitted in properties located in
- Autonomous Region of Madeira
- Autonomous Region of Azores
- Hinterland territories listed in annex to the Ordinance no. 208/2017
This change effectively means any investor buying properties in Porto, Lisbon, and other locations not included in the above-mentioned areas and territories will not qualify for the golden visa.
With this change coming into force from January 1, 2022, the net result in anybody buying property in the capital city or in Porto will continue to qualify for the golden visa until the end of 2021.
Will the Changes Work?
Portugal introduced the golden visa after the 2008 economic crisis in a desperate attempt to boost its economy and attract precious foreign investment. The pandemic has created another economic crisis and countries will yet again look to attract investment immigrants.
The hike in minimum investments to qualify under the capital transfer route, although substantial, is unlikely to see significant opposition from investors. This is because more than 90 percent of all golden visa applicants prefer the real-estate investment.
This is why the decision to restrict investors to properties located in specific locations and regions in Portugal is likely to see significant opposition.
The amendment was strongly criticized when it was first introduced in 2020, which forced the government to defer the implementation of the change to 2021. The pandemic has further complicated matters but the government has refused to withdraw the change and has elected to defer it further to 2022.