Bulgaria keeps delivering “golden passports” to wealthy non-EU foreigners in return for ‘investment’, but it turns out that in most cases, such investment does not materialise, so the country gains little and may even risk an infringement procedure from Brussels. EURACTIV Bulgaria reports.
Information obtained by EURACTIV Bulgaria under the Access to Public Information Act, appears to confirm the suspicions that the sale of Bulgarian citizenship does not bring investment to the country.
Most foreigners who have bought Bulgarian “golden passports” have actually used a scheme that allows them to avoid having to invest a penny in the country. Others have only deposited money in an account in a bank in Bulgaria, which they can withdraw immediately after receiving the passport. Nobody has bought a real business.
So far, 98 foreigners have obtained Bulgarian citizenship after declaring “investments” of at least BGN 2 million (€1 million) in the country. However, there are no such investments.
Worse still, it turns out that Bulgaria actually pays the people to whom it has granted citizenship because those ‘new citizens’ who purchase and keep government debt earn dividends.
The new information obtained shows that 78 out of these 98 foreigners have bought government securities, received Bulgarian citizenship, and many of them then sold back the securities, while those who kept them received dividends. Another six “investors” have deposited money in a Bulgarian bank, which they are free to withdraw when they like.
Bulgarian passports are attractive to foreigners because they give them the opportunity to travel freely in the EU. It is less clear what the benefit for the country is, because data shows that selling Bulgarian citizenship has not brought any significant foreign investment, and will most likely result in infringement procedures against the country.
The ruling coalition government of Boyko Borissov insists that the scheme should be preserved. Their argument is that Bulgaria should not be deprived of an opportunity to attract big foreign investors. They say that the system must be improved by making sure that real investment is made.
The European Commission has already opened infringement procedures against Malta and Cyprus for selling citizenship for investment. Bulgaria was warned that it would most likely be next in the Commission’s crosshairs.
In December, the Ministry of Justice processed another batch of 20 applications for Bulgarian citizenship by foreigners who bought only government securities.
For the last year and a half, the government has been withholding a draft bill that would put an end to the practice of selling citizenship. The European Parliament, for its part, is currently preparing a new legislative report on citizenship practices in exchange for EU investment.
Interestingly, the rapporteur for the S&D Group is Elena Yoncheva, a Bulgarian MEP from the opposition. Bulgaria will hold parliamentary elections on 4 April, with Borissov’s GERB party (EPP-affiliated) and the Bulgarian socialists neck-and-neck in polls.
[Edited by Zoran Radosavljevic]