Jul 03, 2017
COLLECTING A SECOND PASSPORT
MORE HIGH-NET-WORTH INDIVIDUALS BUY SECOND PASSPORTS; COLLECTORS TAKE NOTE
Globalisation has created a new class of mobile citizen seeking multiple nationalities. A second (or perhaps third) nationality provides the high net worth individual living in a fractious world with a way to pursue business, financial and personal opportunities in geographies with political and economic stability and better overall quality of life. An additional passport can facilitate residency abroad, ease of travel and access to, and mobility of, personal assets. This can have special benefits in the art world.
Obtaining a passport has never been easier for those of means. Entering Citizenship by Investment Programs (CIPs) is currently one of the most popular methods of obtaining multiple nationalities. In terms of mobility, the benefits for high-net-worth individuals (HNWIs), including collectors and dealers of art, culture vultures and adventurers, are palpable.
Today’s HNWIs see passport collecting as an avenue to mobility, luxurious lifestyles, and a window into the fascinating world of culture and history around the globe. The privileged can achieve unique experiences and access rare displays of artistry and talent in far-flung destinations. For collectors and dealers of art, this access can be especially important. The appeal is both aesthetic (in terms of first-hand enjoyment of artistic works and experiences) and highly practical for doing business.
On the practical front, investing in an alternative residence and citizenship, acquiring a second passport, is seen as an instrument of financial and personal security. A growing number of HNWIs seek additional passports for asset protection, minimization of taxes, better tax planning, as well as an insurance in the event of economic and social upheaval or unstable, confiscatory political regimes. Where instability reigns, assets are at greater risk.
In terms of family relocation to a foreign country, obtaining another passport may be the best solution. While there are many ways to immigrate to a foreign country, CIPs are typically the fastest and most straightforward means to a second passport for most HNWIs and their family members. The specifications of different programmes vary by country, allowing foreigners to invest in real estate projects and businesses, to purchase properties, or to donate money directly to a country’s governmental fund in exchange for citizenship and its inherent rights.
Many HNWIs are willing to spend hundreds of thousands - even millions - of dollars to add a second or third passport to their collections, given the benefits resulting from such acquisitions. This is, especially true in China, Russia, the Middle East and other parts of Southeast Asia. Who would not be tempted by the right fast-track citizenship program, which can provide a second passport that allows visa-free access to major regions and countries in the world, including stable jurisdictions such as the Schengen states, the United Kingdom, Singapore, and Canada? For many, such open doors are well worth the price, and even considered a bargain.
Given the number of welcoming, business-friendly jurisdictions offering the incentive of affordable investment opportunities and fast-track citizenship processing, today’s HNWIs are spoiled for choice as to where they can acquire their new citizenship and passport. There is growing competition – especially amongst a number of well-regulated, tax-friendly offshore jurisdictions in close geographical proximity. This is the case in the Caribbean, which currently has five countries offering CIP options: St. Kitts and Nevis, Antigua and Barbuda, Dominica, Grenada and St. Lucia. In Europe, on the high end of the CIPs spectrum, Cyprus and Malta are two countries offering a citizenship by investment option to HNWIs, literally unlocking the concept of acquiring a European passport, and hence the right to reside in an EU member country.
Despite the fixed investment price for each CIP, for HNWIs nowadays, passports are truly “collectibles” with priceless value.