On February 16th, the Portuguese government announced a series of measures aimed at addressing the country’s housing problem.
The Portuguese Prime Minister stated [click here for an exact translation of his speech] that the measures include changes to the Golden Visa program. He hinted that the program may be eliminated for new applicants and that the existing Golden Visas will be renewed only if certain conditions are met.
In this article, we’ll break down what you need to know about the potential end or the significant change of Portugal’s Golden Visa program and what it means for investors.
What does it mean?
Currently, there is a widespread feeling of surprise and uncertainty due to the contradictory and technically inaccurate statements made about the topic of housing. It’s crucial to analyze the objective data in detail and approach any new information with caution.
Some important procedural facts:
- The government does not have legislative competence to make changes to the Golden Visa program. The assembly of the Republic is responsible for approving any proposed changes. They will need to receive a proposal outlining the measures for voting.
- The process involves a one-month public hearing, followed by a proposal sent to Parliament on March 16th. Approval should take 15-20 days.
- Then, the President will react in one of three ways: (1) ratify the proposal, (2) return it to Parliament for amendment, or (3) ask the Constitutional Court to evaluate it.
- The governing party can approve the measures without changes because they hold the majority. However, other parties may propose alternative wording during public hearings. These proposals may influence the final wording of the law.
- Other immigration programs such as D7 Visa or Digital Nomad Visa were not discussed, but if some of the proposed measures are approved, it may require changes to the current law. This could affect standard residence permits.
- The Government aims to renew the existing Golden Visa cases but add extra requirements to use Golden Visas to address the housing issue.
Some assumptions in line with the points above:
- The current law is expected to remain unchanged for at least the next 45 days as of February 16th, 2023.
- The exact content of the final amendments to the law remains unknown to both the Government and the Parliament, yet.
- There is a high risk of complete termination of the program in the short-to-medium term.
- The timing of the implementation of the amendments is not announced, yet.
- There was room for interpretation that the residency program may still exist in some fashion.
- Some of the possible consequences include:
- A rush of applications to apply before changes come into effect
- Legal action against the State to avoid the changes to the program
- Renegotiating ongoing investments to fit other residency programs in Portugal
- Withdrawing ongoing Golden Visa cases en masse and seeking compensation from the State
Getting Through the Transition Period by Securing Your Investment
So, do you want to apply for a Portuguese Golden Visa before the changes come into effect?
Well, we’ve been through this before back in 2021, before the last significant set of Golden Visa changes were implemented on January 1st, 2022. In 2021 alone, we managed to secure hundreds of Golden Visa applications before the changes kicked in, with a 100% success rate.
Get in touch with us and let’s discuss how we can navigate your application before any changes take place.
Will Previous Or Current Applicants Be Affected?
Although there is no official declaration yet, the general expectation among law firms is that the previous or current applicants will not be affected by the changes or the potential termination of the program. However, the Portuguese Prime Minister hinted at some conditional renewals of Golden Visas for applicants that applied through the purchase of a real estate property in Portugal.
The Verdict with What We Know So Far
In Portugal, abrupt and disruptive measures are not commonly adopted, so it is best to wait for the final approval of the changes to the Golden Visa program.
The last change to the program was announced in December 2020 and was only implemented on January 1, 2022. The government provided a sufficient grace period to the investors before implementing the changes.
Investors should consider the risk of the unknown, but make decisions based on the law in force to benefit from legal protection.
Our firm will actively participate in the discussion of the changes, which may undergo significant changes through public contribution or the opposition political parties.
For those at an advanced stage of the process, it is suggested to submit the process quickly. Those still negotiating should extend the negotiations for a period that allows some clarity on the amendments.
Those in the early stage of the process should complete the preparatory steps to immediately act when the concrete amendments and timings are known.
We will closely monitor the situation, keeping clients and partners aware of any developments.
Prime Minister’s Statement (Feb 16th)
Exact translation of Prime Minister’s statements on February 16th, 2023:
The related statements by the Portuguese Prime Minister:
“Two particularly important measures to combat real estate speculation – the first, the elimination of golden visas, or rather, the elimination of the granting of new golden visas. As for the golden visas already granted, their renewal, in the case of exclusively real estate investments, will only be renewed if they are the owner’s own or permanent home or of his descendant or if the property is placed, on a permanent basis, on the rental market.”
His clarifications later:
“Meanwhile, a new immigration law for foreigners came into effect. This law already regulates in a very innovative way the granting of residence permits for special purposes; for the purposes of studies, investment, highly qualified, seasonal workers, for various circumstances. This regime must be the ruling regime, not justifying, nowadays, what is the exceptionality of the golden visas. In fact, what we can see is that of the approximately 11,000 Golden Visas granted so far, more than 9,000 came through real estate investment. A very low rate, not to say almost zero, in job creation and a very low contribution to other activities.
There are some golden visas that are active in the field of cultural patronage. What will happen? One thing is a decision not to have new ones, another thing is what happens to those currently granted. Those already granted, at their end, are subject to evaluation. If it is exclusively for real estate, there will be renewals if the real estate investment is for permanent own housing, for descendants, or is placed on the rental market – and here, we do not place the restriction of being placed on the affordable income market; it is purely and simply placed in the rental market. There are others that were granted for other purposes and, in this case, looking at the current law, it is possible to convert them depending on what the concession counterparts were, namely, in the area of cultural patronage, so there will be no disruption there. There will be a reclassification of the legal figure.”
The statement by the Portuguese Minister of Finances on the end of the Golden Visa program:
“The elimination regarding Golden Visas is general, regarding the entire model that is known because the assessment that is done even of the recent changes that have been made regarding the limitation to real estate were not sufficient regarding the continuation of the mechanism. And it has the following characteristics: (i) on the one hand, we are talking about new applicants, new candidates for golden visas. The system will close and will remain active in renewals under certain conditions, and what Mr. Prime Minister referred to is that under the new legislation regarding the entry, stay, and exit of foreigners that there are mechanisms that allow this mobilization, namely, for investment purposes, which are carried out, namely, in the cultural areas and others that I mention. But the assessment we have so far of the use of the instrument is rather residual in other purposes than real estate, and that is why this additional step is taken”.
Frequently Asked Questions on Portugal Golden Visa Changes
Will the Portugal Golden Visa program be canceled?
It is possible. Yet, we do not know what the exact changes will be and if it will be a complete termination of the program.
How Can Get Golden Visa Help
Get Golden Visa is a full-service investment immigration agency. We provide end-to-end solutions on residence and citizenship by investment programs in numerous countries worldwide.
We have local offices in Lisbon and Porto, Portugal. We have legal professionals, as well as licensed real estate professionals within our team.
We work with clients from all around the world, interested in obtaining Portugal Golden Visas or in making real estate investments in Portugal.
Contact us and talk to one of our experienced team members to help you with any and all your questions.