More than four years after the launch of Vanuatu’s Development Support Program (VDSP), Vanuatu finally looks set to introduce a long-awaited real estate investment option (REO). The government is preparing a bill to cover the considerable legislative changes necessary to introduce the REO, which is slated for consideration by Parliament during its next sitting later this month.
Passage of the bill in Parliament would pave the way for the necessary changes through a set of revised Regulation Orders under the existing Vanuatu Citizenship Act Cap 112.
In response to an approach by IMI, the Vanuatu Citizenship Commission’s Chairman, Ronald Warsal, has released the following statement:
03 April 2021
Statement by Chairman of the Vanuatu Citizenship Commission, Mr Ronald Warsal, regarding the proposed introduction of a Real Estate Option for Vanuatu’s Citizenship by Investment Program, the Development Support Program (DSP)
Vanuatu’s Citizenship by Investment Program, the Development Support Program (DSP) remains a cornerstone of our capacity to maintain economic independence during the on-going Covid 19 pandemic. With our borders remaining closed, revenues from the DSP have safe-guarded Vanuatu’s capacity to meet all its financial obligations both domestically and internationally.
The Program continues to undergo review and refinement to ensure that not only does it meet the norms and expectations of the international organisations and governments with whom we work, but also to make sure that our Program remains relevant and “fit for purpose” in the coming years.
One crucial aspect of our efforts to develop the Program is with the explicit aim of generating greater benefits for our wider economy, by developing opportunities for attracting investment into Vanuatu that will result in jobs and tangible improvements for all in our community.
We have given careful consideration to various options for broadening the scope of DSP investment opportunities, and one obvious channel that has been shown to be particularly effective and attractive in other CBI programs globally is the creation of a Real Estate (Investment) Option (REO).
The process of creating and launching an REO requires considerable work, as major changes in legislation are required. Working with the State Law Office and other stakeholders, the Citizenship Commission has devised an REO framework to be submitted as a Bill during the next Parliament sitting in April 2021.
Subject to smooth passage of the Bill, an amended set of Citizenship Program Regulation Orders will be issued, which will include the basis for a new REO Citizenship alongside other measures for the enhancement of the Program encompassing due diligence, process, and distribution in line with our goal to elevate the Program to top-tier level.
We believe that our Real Estate-linked Citizenship will be enthusiastically received internationally and domestically alike for the tangible benefits that it will generate.
Interest in (and revenue from) Vanuatu’s citizenship program – a collective term that refers to both the VDSP and VCP – has accelerated sharply since 2017. The speed and simplicity of the application process, however, which have been hallmarks of the program to date, have also raised questions about the adequacy of due diligence procedures. Observers have also called into question whether Vanuatu’s legislative branch has taken the steps necessary to put the honorary citizenship matter definitely to rest.
“The introduction of a REO, although a welcome enhancement, can only realistically succeed if accompanied by an overhaul and repositioning of the entire program, something that is mentioned in the Chairman’s statement,” commented James Elcocke-Harris of Vanuatu Investment Migration Bureau, a designated agent for the VDSP.
The Commission has, so far, offered little in the way of details about the proposed REO. Open questions include:
- Will the REO apply to both the VDSP and VCP?
- When can we expect a market launch for the REO, presuming the bill passes in Parliament?
- What investment amounts will apply?
- By which criteria will the government designate real estate projects?
At least some of those questions may be answered next week: Chairman Warsal is expected to make announcements regarding the new REO during a webinar hosted by RIF Trust and Latitude on Tuesday at 3PM CET.