The Cyprus Government has defended citizenship by investment scheme, in response reuters investigation of family members of Cambodian Hun family members holding cypriot passports, saying a number of security measures and control checks involved before being granted passports.
Cambodia legalized dual citizenship in 1996, so it is not unusual for cambodians having multiple citizenships or passports. So Hun family members did not violate any dual citizenship laws.
The Government recently further said that would investigate further on how members of elite obtained cypriot passports through investment. Further Ministry of Interior will launch an investigation will be launched in to all cyprus passports issued after previous criteria. Cyprus launched CIP scheme in 2013 and since then it
The Ministry of Interior has released an official statement in response the cambodian scandal below:
Referring to yesterday’s report by the Reuters news agency regarding the granting of Cypriot citizenship to Cambodian nationals, it is noted that the Cyprus Investment Program contains control procedures designed to avoid abuse so that they are assessed and further assessed. more reliable and transparent. All applications are processed on the basis of the following.
First of all the Program since 2013, when it was announced, entails the requirement that applicants be a white criminal record and should therefore include in their application a certificate of white criminal record from their country of origin and country of residence (if different). Also, the Program from 2013 stipulates that applicants should not be included in the list of persons whose property is frozen within the European Union.
The last revision of the Program, which took place on 13 February 2019, added two additional safeguards. In particular, applicants / applicants must now hold a Schengen visa in force and applicants who have applied for citizenship in any other EU Member State that has been rejected are not entitled to obtain Cypriot citizenship in the EU. frames of the Program.
Regarding the financial aspect of the Program, it is stated that from 2013 the Program assumes that all financial transactions required for the realization of investments will have to be carried out through the Cypriot banking institutions. The purpose of this obligation is to ensure that all incoming funds as well as interested parties pass the money laundering checks carried out by Cypriot banks. These audits are based on the relevant instructions issued by the Central Bank of Cyprus.
In order to ensure the application of this provision, applicants are required to include in their application copies of remittances. It is considered to be unacceptable that investments made with cash transactions are not accepted for the purposes of the Program. This requirement of the Program is in line with the European Union directives on combating money laundering and this is recognized in the European Commission’s report on investor citizenship and residence permits in the European Union, prepared in January of this year.
As for the due diligence checks of the Program, all / all applicants are sent for inspection to the State security authorities. In 2018, the Government has decided to further strengthen due diligence checks. As a first step, it was decided to further evaluate the applicants through a subscriber commercial database provided by a specialized due diligence firm. At the same time, in addition to the above, it was decided to implement enhanced due diligence checks through cooperation with three specialized due diligence firms. These bids have been identified through an open tender procedure, which began in April 2019. The bidding process is currently in its final stage and the signing of contracts is pending. Subsequently, enhanced due diligence checks will be immediately applied to all applicants.
It is noted that in July this year the Council of Ministers issued clarifications on the existing Program, which was drawn up on 13.2.2019, and in particular as regards high-risk applicants / applicants, as it made public specific categories of persons who are not entitled to acquire it. Cypriot citizenship through the Program. These categories are as follows:
I. Politically Exposed Persons Holding or Holding a Political Position for the Last 5 Years
II. Persons subjected to criminal investigation without charges being charged
III. Persons subject to criminal investigation
IV. Persons sentenced to imprisonment for serious offenses (eg public servant bribery, tax evasion, etc.) and the penalty has been prescribed
V. Persons linked to legal entities subject to EU restrictive measures eg. share holders, senior executives of companies included in the list of sanctions
VI. Persons affiliated with legal entities who have been restricted by the EU, but are no longer associated with eg. shareholders, senior executives of companies that were included in the list of sanctions, which were associated with those companies when the sanctions regime was imposed.
VII. Persons Sanctioned by Third Countries (eg US, Ukraine, Russia)
VIII. Persons associated with legal entities subject to sanctions by third countries.
IX. Persons being investigated / charged with criminal offenses and being sought across Europe by EUROPOL or internationally by INTERPOL.
X. Persons investigated / indicted for criminal offenses, are being sought across Europe by EUROPOL or internationally by INTERPOL and are no longer sought.
XI. Persons subject to sanctions by the UN Security Council.
In addition, it should be noted that in 2018 the Government decided to introduce control procedures to oversee the ever-increasing number of natural and legal persons providing administrative services for the Program. Among other things, an obligation has been introduced for them to be registered in a “Service Provider Registry for the Cyprus Investment Program”, as well as an obligation to apply a relevant “Code of Conduct” which sets out the basic principles that Providers must apply to their obligations to customers. / their customers and the Program as well as any consequences in cases of non-compliance. One of the obligations of service providers – as set out in the Code of Conduct – is to carry out due diligence checks on their / their clients / clients including the confirmation of the origin and legality of the investment funds. Also, client / client applications should be accompanied by a report of due diligence report from an internationally accepted online database for which an access fee is paid. The above was implemented in June 2018 and the first Registry was prepared on July 31, 2018.
Finally, it is stated that the Government’s policy is not to comment on individual cases publicly.
October 17, 2019
