Investment migration represents a significant intersection of global mobility, international finance, and sovereign rights.
This field encompasses the legal frameworks and processes that enable individuals to obtain residence or citizenship rights in a country through qualifying investments in its economy. Over the past three decades, it has evolved from a niche industry into a mainstream path for global mobility, attracting over $20 billion in annual investments worldwide.
Investment migration programs serve dual purposes: for nations, they provide a vehicle for foreign direct investment, economic development, and job creation; for individuals, they offer enhanced global mobility, business opportunities, lifestyle options, and succession planning benefits.
These programs typically come in two main forms: Citizenship by Investment (CBI), which provides direct paths to a new passport, and Residence by Investment (RBI), which offers immediate residence rights with potential paths to citizenship.
The industry operates within a complex ecosystem of government policies, international laws, due diligence procedures, and financial regulations.
Understanding its terminology is crucial for investors, practitioners, and stakeholders navigating this sophisticated field. This glossary provides comprehensive coverage of essential terms, from basic concepts to emerging trends, reflecting the dynamic nature of investment migration in our increasingly interconnected world.
As global events, economic shifts, and policy changes continue to shape the investment migration landscape, keeping abreast of industry terminology becomes ever more important for making informed decisions and understanding program requirements, opportunities, and obligations.
In this piece, we have gathered the most pertinent investment migration terminology to help you conduct your own research, understand what issues you might need to focus on, and give you more insight into what aspects of investment migration you need to consider before applying for a second citizenship or residency.
Table of Contents
- Introduction & Core Concepts
- Legal and Administrative Terms
- Investment Related Terms
- Application Process Terms
- Rights and Status Terms
- Financial Terms
- Documentation Terms
- Compliance and Risk Terms
- Tax-Related Terms
- Regional Concepts
- Industry Stakeholders
- Travel and Mobility Terms
- Program Maintenance Terms
- Emerging Trends
Introduction & Core Concepts
These fundamental terms form the backbone of investment migration, defining the basic principles and key concepts that shape the industry as a whole.
Investment Migration
The industry and practice of obtaining residence or citizenship rights in a country through investment in its economy, whether through real estate, business ventures, government bonds, or other approved investment vehicles.
Citizenship by Investment (CBI)
The process of obtaining a second citizenship through a qualifying investment in the host country. Unlike naturalization, CBI programs typically don’t require extended physical presence in the country.
Residence by Investment (RBI)
Also known as “Golden Visa” programs, these schemes grant residence rights to foreign investors who make qualifying investments in the host country.
Due Diligence
The comprehensive background checking process conducted on applicants to verify their identity, source of funds, and ensure they meet the program’s requirements.
Legal and Administrative Terms
These terms cover the legal framework and administrative processes that govern investment migration programs and their implementation.
Naturalization
The legal process by which a non-national of a country acquires the nationality of that country after birth. This can occur through various paths including residence, marriage, special service to the country, or other criteria defined by national law.
Traditional Naturalization
The most common form of naturalization, typically requiring extended legal residence, language proficiency, cultural integration, and/or other criteria specified by the host country.
Discretionary Naturalization
The granting of citizenship through special circumstances or at the discretion of government authorities, often for exceptional contributions to the country.
Citizenship by Investment Unit (CIU)
The government department specifically responsible for managing and processing citizenship by investment applications.
Alternative Investment
Any qualifying investment option beyond the standard choices, where available.
Accelerated Processing
Fast-track application processing available in some programs, usually for an additional fee.
Exit Tax
Tax obligations that may arise when renouncing previous citizenship or changing tax residency.
Investment Related Terms
These terms describe the various investment options, requirements, and financial aspects of investment migration programs.
Investment Funds
Regulated collective investment vehicles that pool investor capital to make qualifying investments under citizenship or residence programs.
ROI (Return on Investment)
The financial return realized on program-qualifying investments, considering both the investment’s performance and any citizenship/residency benefits obtained.
Investment Holding Period
The mandatory duration for which an investment must be maintained to satisfy program requirements and retain citizenship or residency status.
Government Bond Investment
A qualifying investment option where the applicant purchases government bonds for a specified period, often with zero or minimal interest.
Real Estate Investment
The purchase of approved property meeting minimum value thresholds set by the program, either for personal use or as an investment.
Business Investment
Direct investment in new or existing businesses, often with requirements for job creation or economic impact.
Government Fund Contribution
A non-refundable payment made directly to a government development fund.
Active Investment
Investments requiring direct involvement in business operations or management, such as starting and running a company.
Passive Investment
Investments that don’t require active participation, such as government bonds or real estate purchases.
Business Immigration
The process of obtaining residence or citizenship rights through business ownership, management, or investment in a country’s economy.
Application Process Terms
These terms relate to the procedures and requirements involved in submitting and processing investment migration applications.
Principal Applicant
The main investor applying for citizenship or residence through the program.
Dependent
Family members (typically spouse, children, and sometimes parents) who can be included in the main application.
Eligible Dependents
Family members who qualify to be included in the main applicant’s citizenship or residence application, typically including spouse, children under certain ages, and in some cases, dependent parents or grandparents.
Financial Dependency
The condition where one person relies on another for financial support, typically relevant for dependent applications. Financial dependency must usually be:
- Documented through bank statements and support evidence
- Proven to be consistent and substantial
- Demonstrated to have existed for a specified period
- Continuing at the time of application
Source of Funds
A comprehensive documentation and verification process proving the legitimate origin of investment capital. This typically includes:
- Bank statements
- Business ownership documents
- Investment portfolio statements
- Sale of assets documentation
- Employment contracts and salary history
- Inheritance documentation
- Tax returns
- Gift declarations (where applicable)
Enhanced Due Diligence (EDD)
An elevated level of background checking for high-risk applications or jurisdictions.
Approval in Principle
A preliminary approval indicating that the application meets basic requirements, pending final verification of investment and documentation.
Request for Evidence (RFE)
A formal request from authorities for additional documentation or clarification during the application process.
Rights and Status Terms
These terms define the various rights, privileges, and status levels available through investment migration programs.
Citizenship Rights
The full range of legal rights and privileges granted to citizens of a country, including voting rights, passport access, and unconditional right of residence.
Resident Rights
The limited set of rights granted to legal residents, which typically exclude certain political rights and may have conditions attached to maintaining status. Unlike citizenship rights, these can be more easily revoked and may require periodic renewal.
Economic Citizen
An individual who has obtained citizenship through a CBI program.
Residency Requirement
The minimum period an individual must spend in the country to maintain their status or qualify for additional benefits.
Residency Validity
The duration for which a residence permit remains valid before requiring renewal.
Permanent Residency
An immigration status allowing an individual to reside indefinitely in a country, typically with fewer restrictions than temporary residency.
Temporary Residency
Initial residence status granted for a fixed period, usually requiring renewal and meeting specific conditions.
Long-term Residency
An intermediate status between temporary and permanent residency, typically granted for extended periods with fewer renewal requirements.
Financial Terms
These terms cover the costs, fees, and financial requirements associated with investment migration programs.
Investment Threshold
The minimum investment amount required to qualify for the program.
Processing Fee
Administrative costs charged by the government for handling the application.
Professional Fee
Charges by authorized agents or law firms for their services.
Lock-in Period
The minimum duration an investment must be maintained.
Documentation Terms
These terms relate to the various documents and authentication requirements in investment migration processes.
Apostille
A form of authentication issued by designated authorities to verify documents for international use under the Hague Convention.
Certificate of No Criminal Record
Official document confirming an applicant has no criminal history in their country of residence.
Professional Reference Letter
A formal letter vouching for an applicant’s character, typically from business associates or professionals.
Bank Reference Letter
Official document from a bank confirming the client’s financial standing and relationship duration.
Compliance and Risk Terms
These terms cover the regulatory requirements and risk management aspects of investment migration programs.
Anti-Money Laundering (AML)
Regulations and procedures to prevent the legitimization of illegally obtained funds.
Know Your Customer (KYC)
The process of verifying the identity and suitability of applicants.
Risk Assessment
Evaluation of an applicant’s profile for security and compliance purposes.
Tax-Related Terms
These terms cover the tax implications and considerations in investment migration decisions.
Tax Residency
The country where an individual is subject to tax on their worldwide income.
Non-domiciled (Non-dom) Status
A tax status available in certain countries allowing foreign residents to pay tax only on income brought into the country, rather than on worldwide income.
Special Tax Regimes
Specific tax arrangements or programs designed to attract foreign investors and residents, offering preferential rates or treatment.
Common Reporting Standard (CRS)
Global standard for automatic exchange of financial account information between tax authorities.
Substance Requirements
Minimum criteria for establishing genuine tax residency in a jurisdiction.
Tax Planning
Strategic arrangement of investments and residence to optimize tax efficiency legally.
Regional Concepts
These terms describe important regional agreements and systems that affect mobility and rights across multiple countries.
Schengen Zone/Area
A group of 27 European countries that have abolished internal border controls between member states while maintaining common external border policies. The zone allows for free movement once inside its territory and is particularly relevant for residence program investors calculating their global mobility benefits.
European Union (EU)
A political and economic union of 27 member states that operate under a standardized system of laws and free movement of people, goods, services, and capital. Citizenship of any EU country confers EU citizenship rights, including the right to live and work in any member state.
Common Travel Area (CTA)
An arrangement between the United Kingdom and Ireland (including the Channel Islands and Isle of Man) that allows British and Irish citizens to move freely and reside in either jurisdiction with associated rights to work, study, and vote in certain elections.
CARICOM (Caribbean Community)
A group of twenty countries (fifteen member states and five associate members) sharing economic integration and cooperation. CARICOM nationals from member states enjoy certain privileges regarding movement within the region.
MERCOSUR
A South American trade bloc that includes provisions for free movement of citizens between member states. Full members include Argentina, Brazil, Paraguay, and Uruguay, with various associate members having different levels of movement rights.
EU Golden Visas
Collective term for residence by investment programs offered by EU member states.
Caribbean CBI
Collective reference to citizenship programs offered by Caribbean nations.
Industry Stakeholders
These terms identify the key players and organizations in the investment migration industry.
Authorized Agent
Licensed professionals or firms approved to submit applications.
Government Unit
The official department responsible for processing applications.
Investment Migration Council (IMC)
The worldwide association for investor immigration and citizenship-by-investment.
Travel and Mobility Terms
These terms relate to international travel rights and capabilities associated with different citizenships and residencies.
Global Mobility
The ability to travel internationally with reduced visa requirements, typically measured by the number of countries accessible visa-free or with visa-on-arrival.
Passport Power
A measure of a passport’s strength based on:
- Number of countries accessible visa-free
- Number of countries accessible with visa on arrival
- Electronic travel authorization capabilities
- Diplomatic relations
- Global mobility score
Electronic Travel Authorization (ETA)
A digital pre-travel approval system required by some countries instead of a traditional visa. Usually faster and simpler to obtain than a standard visa, common in countries like Canada, Australia, and the United States (ESTA).
Visa on Arrival
Permission to enter a country granted upon arrival at a port of entry, typically requiring:
- Valid passport
- Proof of sufficient funds
- Return ticket
- Payment of visa fee
- Completion of arrival forms
Electronic Visa (E-visa)
A digital visa obtained through an online application process before travel, eliminating the need to visit an embassy or consulate. Different from an ETA as it typically involves more detailed background checking and processing time.
Visa-free Access
The ability to enter certain countries without obtaining a visa in advance, a key benefit of many citizenship programs.
Multiple Entry Visa
Permit allowing repeated entry to a country or region during its validity period.
Travel Document Ranking
Assessment of passport strength based on visa-free access to other countries.
Program Maintenance Terms
These terms cover the ongoing requirements and processes for maintaining investment migration status.
Renewal Requirements
Conditions that must be met to maintain residence or citizenship status.
Revocation
The withdrawal of citizenship or residence rights due to non-compliance or fraud.
Monitoring Period
Duration during which investments and compliance are actively tracked.
Investment Liquidation
Process of converting program investments back to cash after the holding period.
Exit Strategy
Planned approach for concluding investment and/or program participation.
Residency Surrender
Formal process of giving up residence status in a country.
Program Transfer
Moving from one investment migration program to another.
Emerging Trends
These terms reflect new developments and evolving aspects of the investment migration industry.
Digital Nomad Visa
New category of residence permits for location-independent workers.
Remote Investment
Investment options that can be managed without physical presence.
Sustainable Investment
Environmental or social impact investment options gaining popularity in newer programs.
More to Learn
Investment migration is a complex issue that is made easy through the guidance of experts in the field of NTL Trust. It is important to understand what makes it such as powerful tool for wealthy individuals, and NTL Trust can help do that by sharing their thirty years of experience with you.
To know more about investment migration and understand which program suits you the best, contact NTL Trust today to book a comprehensive consultation with one of our experts.
