Latvia issued over 19,000 residence permits to investors over 11 years

The Citizenship and Migration Affairs Office (PLMP) have issued around 19,300 temporary residence permits for investors during the investment program implemented between July 1, 2010, and December 31, 2021, according to the information report of the Ministry of Interior, LETA reported May 30.

The investment program between 2010 and 2021 provided that foreigners who invest in Latvian economy receive a temporary residence permit upon request, as outlined in Section 23 of the Immigration Law.

A total of 6,788 investors and members of their families with valid residence permits were staying in Latvia as of December 31, 2021, up by 653 people on December 31, 2020.

Between July 1, 2010, and December 31, 2021, PLMP refused to issue temporary residence permits to investors in 198 cases but cancelled 2,763 temporary residence permits.

Of the total funds invested in the investment programme, 83% or EUR 1.32 billion is related to transactions in the Latvian real estate market. Investments in the underlying liabilities of credit institutions represent 10% or EUR 158.9 million, while the allocated investments in the equity capital of capital companies are 6% or EUR 93.4 million.

Meanwhile, €14.7 million, or less than 1% of the total investment, was invested in the purchase of certain non-interest-bearing government securities.

Applicants for temporary residence permits are mainly from regions with unstable geopolitical situations and increased risks to raise capital. Around 86% of all temporary residence permits have been requested by investors from the former USSR territory, while outside it the largest investor interest is from Asian countries.

The Interior Ministry said that a change in the terms of the investment program, which became more stringent in September 2014, has significantly reduced the number of applications received under the program and the volume of investments. Meanwhile, the restrictive measures of the Covid-19 pandemic have not significantly affected investment flows associated with temporary residence permits.

A total of 182 investors' applications were received last year, with investments amounting to EUR 35.7 million, most of which still consist of real estate investments.

On the other hand, if in 2014 the number of temporary residence permits issued within the investment program represented 53% of all temporary residence permits issued to third-country nationals, it has fallen sharply in years following, representing 4.5% of the total number of newly issued permits in 2021.

The reduction in the number and size of investments related to a temporary residence permit has also been affected by measures taken to reinforce the supervision of deposits of non-residents in commercial banks of Latvia. The number of applications for residence permits related to investments in the underlying liabilities of credit institutions has heated up in recent years and does not currently indicate any interest of non-residents in this type of investment in the Latvian economy, the information report says.

In March 2022, the Latvian government decided to end the issue of temporary residence permits for the purchase of real estate and other investments. The Prime Minister stated at the time that the Interior Ministry was working on relevant amendments to the law.

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