CYPRUS: Paying for our mistakes over the passports fiasco

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So, here we are dear readers, now we have received the bill of €1,200,000 for foreign companies to carry out the due diligence investigations regarding the passports issue (as we are not doing a good job ourselves).

This bill, should, in our opinion, be covered by the developers/agents/advocates who are the primary beneficiaries of this billion-euro bonanza. 

We fail to see why, the rest of us who have no direct benefit, should foot the bill through the government budget.

In our opinion and bearing in mind the maximum ceiling set by the Government for the passport issue to foreigners (700 passports), this comes to approximately (€1,200,000 ÷ 700) = €3,500/ applicant. 

This amount should be paid at least by the seller (developer or individual sales) since they are the primary beneficiaries. 

Similarly, to the passport charge of €3,500/applicant, we should introduce another charge of €1,000/applicant for the visas – to be consistent.

It is a fact the developers with their insatiable increase of profits have caused the E.U.’s  reaction on the subject, which has resulted in increased taxes (see added €150,000 per applicant) the proposed 4% tax on transactions etc, which at the end this investment scheme will become a non-competitive one, by comparison to other countries.

It seems that as a country we have to foot the bill as these restrictive measures/taxes are not enough, we have our “unwise” MPs to insist that we should publish the names of those who secured such passports.

In the end, we will be out of this market and we will be wondering what went wrong, whereas the unclear stance of the “Commissioner of the Protection of the personal data” is baffling.

We remind you of the warning the ex-Minister of Interior 2 years ago on this regarding the whole page ads on the subject and even the shocking shop window at the ex-Hilton Hotel.

As well as the Paphos developer who placed an open invitation to everybody who introduced such clients for passports “stand to gain a substantial income”.

We wonder is there a country where the property market does not comprise of local and foreign buyers.  

Is there a logic when our competitors do not adopt such extreme measures, we should be the ones to inflict upon ourselves the damage?

With all these restrictions (some of which are reasonable since we did not do a good job ourselves) and bearing in mind the increased competition from more attractive countries, such as Greece, it’s a matter of time (1-2 years) before the whole Cyprus investment scheme fails with the loss of millions in foreign income.

We seem to concentrate our attention on passports and home buying, but based on experience, these Cyprus passport holders are interested in large-scale investments, especially in the development of hotels. 

The influx of foreign currency has helped numerous debtors to pay-off their debts to the delight of our local banks, they would otherwise be in deep trouble.

We have many projects which are at a standstill such as the pending/licensing of 4 golf courses, the marinas and other types of investments not relating to real estate as such, which we have to consider the effect on such projects if the investment scheme fails.

Who will pay then dear readers for the situation that we will have soon?

We suggested  in a previous article that those developers who do not handle such matters with extreme care, should pay a fine of €500,000 per transaction and for which we have received the angry reaction of developers.  We took it that we must be on the right path mind you!!