Portugal's Golden Visa. Our take on its possible termination

Joana Torres Fernandes | Lawyer

Portugal has risen notably in 2012, when the Portuguese Government launched the Golden Visa Programme and since then, it is Europe's most successful residency-by-investment programme targeted at non-EU citizens. However, it might be nearing its termination, according to Portugal’s Prime Minister.

Last week, António Costa stated that the country is evaluating the possibility of abolishing its popular yet controversial 10-year-old Golden Visa program because it seems to have “fulfilled its function”.

“There are programs that we are currently re-evaluating and one of them is the golden visa which has, probably, already fulfilled its purpose and which, at this moment, we believe to be obsolete,” said the Prime Minister.

There has been increasing pressure from the European Commission to profoundly change or even eliminate citizenship by investment in Europe and the Portuguese government recently introduced new, stricter requirements intended to control the entry of applications, limiting the areas of the country where such investments are allowed. Yet, those measures apparently were not sufficient.

The Portugal Golden Visa has always been a theme of strong controversy with many voices speaking against it in the Portuguese political scene with most left parties opposing to the program and defending its termination. With the Prime Minister, whose party has the majority in the Parliament, announcing that the Government will re-evaluate the Golden Visa, the future of such program seems more indeterminate than ever.

Although there still isn’t an official announcement or particular proposals, or even a debate in the Parliament, it is unlikely that such a statement would be made lightly, provoking to say the least, a wave of astonishment without a substantiated cause. Therefore, we might see a future proposal to be included in the 2023 State Budget at the earliest, although many expert opinions point to 2024 as a more probable date, which is something that we also subscribe to.

Aside from the Golden Visa, Portugal has several captivating residency programs and, according to Prime Minister António Costa, who also emphasized that Portugal wants to continue to be attractive to foreign investors. One such example is the New Digital Nomads Visa, which allows remote workers with high monthly incomes to live and work in Portugal.

What will happen if the Portugal Golden Visa programme ends?

This must be the question in the mind of an investor who has already applied and will likely be worried about the Prime Minister’s unexpected statement.

We share those concerns; however, if the program was to terminate within the next few years, the following measures would certainly apply:

• A prior official announcement of six months, at least, to allow the conclusion of current investment and the completion of on-going applications.
• An investor that submits the application before the end of the programme would be allowed to follow it through to its conclusion, and, provided that the applicant renews it every 2 years and after 5 years, they can also apply for Citizenship.

Portugal has proven repeatedly to be sensible to changes and we have seen that in January 2022 with the Golden Visa programme as well as in 2020 with the Non-Habitual Resident tax regime: applicants who had presented their submission prior to the alterations coming into force benefited from the rules that were in place at the time of their application.

This assessment is shared by LVP Advogados, since every amendment of the law has a period before it enters into force. Therefore, any alteration of the current rules will not happen overnight, and a new law would only be applicable for new submissions, never for the pending processes or the ones being renewed. Portugal abides by the rule of law.

If you have further questions regarding this matter, get in touch with Joana Torres Fernandes and she will be delighted to assist you.