The trend of global citizenship
By Dr. Juerg Steffen, Head of Asia Pacific, Henley & Partners
Today‘s globalised world offers individuals tremendous opportunities to optimise their personal and business lives. This includes increased international freedom of travel, tax and estate planning, as well as diversification on both a business and personal level by having multiple residences or citizenships.
Depending on your current situation, an alternative residence may also mean greater personal flexibility, a better quality of life for your family, a good education for your children, and a safe haven in times of political instability. It’s a trend that is growing rapidly as more countries welcome wealthy and talented individuals by offering citizenship and residence programs that are faster than traditional naturalisation requirements.
The advances in communications and computer technology has made it possible for “knowledge workers” to work and live almost anywhere, and for entrepreneurs and investors to operate and supervise their businesses and investments 24 hours a day from virtually anywhere in the world.
Such people are looking for greater ease of travel for international business and are eager to join the ranks of the world’s ’global citizens’. Global citizens know that the passport they has a huge impact on their access to the world.
For entrepreneurs, global citizenship means increasing business opportunities, while international investors now also diversify their passport portfolios with an eye on the opportunities this can open up. In terms of taxation, there is a growing tendency for countries to consider the lead of the United States in taxing non-resident citizens and, as a result, alternative citizenship is increasingly of interest as an effective tool for future international tax planning.
As a national of two or more different states, you generally have more planning options open to you, and can also enjoy more privacy in terms of your banking and investment. The acquisition of alternative citizenship in itself normally does not alter one’s tax situation and, while minimising one’s tax liability is a motivating factor for a number of individuals who seek dual citizenship, for the majority of our clients their business and lifestyle needs are the determining factors.
The option of global citizenship is proving popular all over the world and, in the last couple of years alone, new programs have been introduced in Antigua and Barbuda, Grenada, Malta, the Netherlands and Spain. These either allow direct citizenship by investment or offer routes to citizenship for wealthy investors through attractive residence programs.
Trust is a vital consideration for anyone seeking advice on investing in another country under a citizenship or residence program, and for the security of your investment and the validity of your passport it is vital that your application is processed in strict accordance with the relevant country’s legislation and is completely authentic. Transparency is essential for the investor’s security and peace of mind, and Henley & Partners offer this through our position as the global leader in government advisory services. These include projects ranging from strategic consulting to the design, implementation and operation of investment related residence and citizenship programs for governments, among them Belgium, Canada, Malta, Switzerland and the United Kingdom. The objective of such programs is to enhance a country’s attractiveness to international entrepreneurs and investors and to create more favorable conditions for foreign direct investments. Our teams have been responsible for over US$3.8 billion in foreign direct investments.
Among our clients are high net worth individuals and families, successful entrepreneurs and investors, top-level managers, artists, and celebrities of the fashion, entertainment and sports worlds. These people wish to internationalize in order to diversify their interests and opportunities, and are joined by wealthy people who may have sold their business (or businesses) and who plan to retire in another country, either for family, financial and estate planning reasons or to enjoy different cultural and climatic opportunities. In view of the increasingly aggressive fiscal and regulatory environment in some otherwise reasonably stable, high-tax countries, a move of residence to a country with a milder tax regime is an attractive option for many who feel they have to pay more than their fair share, and who do not like the constant erosion of their privacy.
What is becoming more important is the fact that citizenship and a passport from a diplomatically stable country could save your life when travelling, in the event of sudden political unrest, civil war, terrorism, or other perilous situations. In fact, many international and high net worth individuals consider an alternative passport as the best life insurance money can buy.
* Henley & Partners will host the 8th Global Residence and Citizenship Conference at the Fullerton Bay Hotel, Singapore on 29-30 October 2014.