Legal context
The elimination of the investor residence permit in Spain. popularly known as the Golden Visa, has been proposed under the Legislative Bill Proposal titled “Organic Law Project on Measures to Improve the Efficiency of the Public Justice Service and Collective Actions for the Protection and Defense of Consumer Rights and Interests“, This project introduces significant changes to current legislation, including the removal of all provisions related to the investor residence permit. If this regulation is approved and published, the Golden Visa will cease to exist entirely.
Foreign investment
The Golden Visa was originally introduced as a way to attract foreign investment to Spain, allowing non-EU citizens to obtain a residence permit by making substantial investments in strategic sectors such as real estate, business capital, or job creation. This program was regulated under Law 14/2013, known as the Law to Support Entrepreneurs and their internationalization. Key requirements included minimum investments of €500,000 in real estate or €1 million in shares of Spanish companies, among other modalities. Its elimination reflects a shift in government priorities, possibly driven by social, economic, or equity considerations in regards to residence permits.
Requeriments
It is important to emphasize that the proposed legislative bill will not have retroactive effects, meaning that investors who already hold a Golden Visa residence permit will continue to benefit from it under the legal provisions under which it was granted. This means that current holders will be able to renew their permits once expired provided they meet the established requirements and procedures within the framework of Law 14/2013. In this sense, the legal certainty of current residence permit holders will not be compromised, ensuring their rights are respected.
Without retroactive effect
Furthermore, it should be noted that the proposal to eliminate this visa is still in its initial stages within the legislative process. As of today, it has not been approved as law nor has it come into force. Therefore, the current provisions under Law 14/2013 remain fully valid, allowing both the issuance of new Golden Visas and the renewal of existing ones.
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Motivations and Context of the Reform
Although the legislative text does not explicitly state the specific reasons behind this elimination, several hypotheses can help explain this measure. In recent years, Golden Visas have sparked debate in various European Union countries, with polarized opinions. Advocates in favor of it argue that these programs have been effective in attracting significant investments, stimulating real estate markets, and strengthening the economy. However, critics point out that in some cases, they have led to undesirable side effects, such as real estate speculation, increased housing prices in urban areas, and unequal access to residency benefits compared to other migrant groups facing stricter restrictions.
Spain is not exempt from this debate, and the fact that this proposed legislative bill includes the elimination of the Golden Visa as a whole may reflect the need to align with more restrictive approaches being adopted by other European countries. For instance, some EU nations have chosen to eliminate or restrict their residence-by-investment programs due to concerns over transparency, risks of money laundering, and the negative social impact on specific local markets.
Expected Impact
The approval of this proposed legislative bill could have significant repercussions in both economic and legal spheres.
From an economic perspective, the elimination of the Golden Visa could affect foreign investment flows, particularly in sectors such as real estate, which has been one of the primary beneficiaries of this program. However, it could also pave the way for alternative models of attracting foreign capital that are not exclusively tied to residency benefits.
Legal scope
In the legal sphere, this measure could represent a turning point in shaping Spain’s immigration policy, marking a shift toward a more restrictive approach to residence permits based on economic criteria. Additionally, it will be crucial to analyze how the transition for current holders will be managed and the legal implications for those in the process of applying if the proposed biill is approved.
Conclusions
The elimination of the Golden Visa in Spain, as outlined in the legislative proposal, represents a highly significant decision in the context of residency policies and the attraction of foreign investments. Although this change is not yet definitive and the current regulations remain fully in force, its eventual approval would mark a significant shift in how Spain manages residence permits for investors.
In the meantime, it will be crucial to closely monitor the evolution of this proposal and any potential modifications it may undergo during the parliamentary process.
If you are an investor looking to apply for this type of permit or already hold one and seek guidance regarding potential legal changes, Supra Legit Lawyers will be delighted to assist you with regulatory compliance and address any questions you may have for your peace of mind.
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