METHODOLOGY

 

Overview

The CBI Index is a rating system designed to measure the performance and appeal of global citizenship by investment (CBI) programmes across a diverse range of indicators. Its purpose is to provide a rigorous and systematic mechanism for appraising programmes, to facilitate the decision-making process for individuals considering them, and to bring value to the CBI industry.

The CBI Index assesses all countries with operational CBI programmes, which, in 2022, include the following 13 nations: Antigua and Barbuda, Austria, Cambodia, Dominica, Egypt, Grenada, Jordan, Malta, Montenegro, St Kitts and Nevis, St Lucia, Turkey, and Vanuatu. With North Macedonia’s much -publicised programme not yet fully operational, Egypt remains the latest addition to the CBI Index after opening in 2020. Bulgaria is no longer considered due to the Programme’s recent abolition.

The nine pillars that constitute the CBI Index include:

  1. Freedom of Movement
  2. Standard of Living
  3. Minimum Investment Outlay
  4. Mandatory Travel or Residence
  5. Citizenship Timeline
  6. Ease of Processing
  7. Due Diligence
  8. Family
  9. Certainty of Product

Arriving at an appropriate rating for the nine pillars involved a complex combination of benchmarking, statistical analysis, and comparative investigation.

Each of the nine pillars is scored out of a maximum of 10 points, calculated on an averaging basis from the scores of composite indicators and sub-indicators. The maximum score attainable by a programme is 90, with all final scores also expressed in terms of a percentage of the total points available. For example, a perfect 90-point score would be expressed as 100 per cent.

It should be noted that, owing to the vast number of statistics, indicators, and sub-indicators available for analysis, no single approach exists for the rating of CBI programmes. In framing the CBI Index, however, reliance was placed on official sources and publications from institutions of the highest international standing, as well as on the specialised input of industry experts, whose contributions and responses were used to obtain and interpret both qualitative and quantitative data used in the construction of the CBI Index.

It should further be noted that, whenever possible, points were awarded based on evidence from official sources and the letter of the law. Because announcements of changes to CBI programmes are often made many weeks and months in advance of their actual implementation, the CBI Index limits its evaluations to changes confirmed by governments themselves and associated legal facts.

Finally, the 2022 CBI Index does not consider temporary measures still in place as a result of Covid-19 pandemic, except in the Certainty of Product Pillar, which takes into account a programme’s ability to respond and adapt to present needs. The more general impact of the Covid-19 pandemic on a nation’s wellbeing is factored in the Standard of Living Pillar.

 

The Pillars

Pillar 1: Freedom of Movement

Freedom of movement within and between countries is of paramount importance to any individual seeking second citizenship. This holds true whether the individual wishes to travel for work purposes, to visit family, or for leisure.

In the 2022 CBI Index, the Freedom of Movement Pillar measures the relative strength of each country’s citizenship on the basis of three equally weighted factors: the number of destinations to which a country’s passport allows travel without restriction, the number of prime business hubs to which it provides access, and the degree to which a given citizenship provides settlement rights in other nations.

It is assumed, for the purposes of this pillar, that the passport used for travel is an ordinary passport, and not a diplomatic or service passport.

Emphasis was placed on the total number of countries and territories that may be visited without applying for a visa. This includes both visa-free and visa-on-arrival destinations, as neither requires persons to receive a visa in advance of travel. Government and other official sources, including data from the United Nations World Tourism Organisation, were used to obtain up-to-date information on visa requirements for holders of each of the 13 passports under evaluation.

As business travel is a prime consideration for prospective global citizens, a passport’s ability to provide access to the world’s leading economic and financial centres was also evaluated. The Heritage Foundation’s Index of Economic Freedom, the World Economic Forum’s Global Competitiveness Report, the International Institute for Management Development’s World Competitive Index, and other authoritative sources were used to arrive at a list of the top centres for international business.

For both of these indicators, points were awarded on a descending scale, with the highest score received by the country with visa-free or visa-on-arrival entry to the highest number of foreign countries or territories.

While the freedom to access a high number of jurisdictions is of critical importance to the citizenship investor, many also look at second citizenship as a gateway to ensuring long-term security and stability for themselves and their families. The settlement rights measure reflects this, making CBI countries that are part of broad free-movement regimes more attractive.

In order to assess settlement rights, value was placed both on the number of jurisdictions accessible within a given free-movement regime and on the nature of the rights afforded to the citizen, with distinctions drawn for rights that are conditional on a citizen undertaking work.

The European Union, the CARICOM Single Market and Economy, the Association of Southeast Asian Nations, the Community of Sahel-Saharan States, and the Common Market for Eastern and Southern Africa free-movement regimes were also assessed against the total average United Nations Human Development Index score of the free-movement bloc under evaluation.

Pillar 2: Standard of Living

The Minimum Investment Outlay Pillar measures one of the most practical and foremost considerations of CBI: how much capital is required for the investor to become an eligible applicant for the programme of their choosing.

The cost of applying for CBI increases with the number of dependants – or qualifying family members – included in an application. In some jurisdictions this increase is proportional, while in others the cost only increases following the inclusion of multiple dependants. To remain consistent across all jurisdictions, it was assumed that one applicant was applying for citizenship alone (i.e., the application consisted of a single applicant).

Where a CBI programme offers multiple investment options, the most affordable was selected for evaluation. For example, Dominica offers a single applicant the choice between a direct contribution to the Government and an investment in pre-approved real estate, with the latter being the more expensive alternative. The first option was therefore used to determine the minimum investment outlay for the Dominica CBI Programme.

This pillar considers pure investment requirements, exclusive of minor fees that may also apply. These may include application, processing, or due diligence fees that do not significantly alter the cost of a citizenship application. However, where countries had sizeable additional fees amounting to US$15,000 or more, such fees were taken into account.

The highest number of points was awarded to the country requiring the lowest minimum investment.

Pillar 3: Minimum Investment Outlay

The Minimum Investment Outlay Pillar measures one of the most practical and foremost considerations of CBI: how much capital is required for the investor to become an eligible applicant for the programme of their choosing.

The cost of applying for CBI increases with the number of dependants – or qualifying family members – included in an application. In some jurisdictions this increase is proportional, while in others the cost only increases following the inclusion of multiple dependants. To remain consistent across all jurisdictions, it was assumed that one applicant was applying for citizenship alone (i.e., the application consisted of a single applicant).

Where a CBI programme offers multiple investment options, the most affordable was selected for evaluation. For example, Dominica offers a single applicant the choice between a direct contribution to the Government and an investment in pre-approved real estate, with the latter being the more expensive alternative. The first option was therefore used to determine the minimum investment outlay for the Dominica CBI Programme.

This pillar considers pure investment requirements, exclusive of minor fees that may also apply. These may include application, processing, or due diligence fees that do not significantly alter the cost of a citizenship application. However, where countries had sizeable additional fees amounting to US$15,000 or more, such fees were taken into account.

The highest number of points was awarded to the country requiring the lowest minimum investment.

Pillar 4: Mandatory Travel or Residence

The Mandatory Travel or Residence Pillar examines the travel or residence conditions imposed on applicants both before and after the granting of citizenship. Often busy with running a business or with international travel of their own, citizens of the world have little time on their hands to fulfil minimum stay requirements.

A careful examination of the laws, regulations, and policies pertaining to each CBI programme was undertaken. First, it was determined whether any such prerequisites applied. Second, post-citizenship requirements were examined, as well as the consequences of failing to fulfil said requirements. Third, the extent of the travel or residence requirements were analysed, with physical visits for the purposes of attending an interview, swearing an oath of allegiance, or giving biometric information all considered.

It is important to note that physical, rather than nominal, requirements were taken into consideration.

In line with previous pillars, scrutiny focused on the main applicant rather than any dependants that may be included in the citizenship application.

As having year-round freedom to travel is a highly valued liberty, programmes that waived both residence and travel requirements achieved the best score, followed by those with minimal requirements. The lowest scores were attained by programmes with extensive requirements.

The scoring system under the Mandatory Travel or Residence Pillar combines the subtotals for mandatory travel requirements and residence requirements to yield the total pillar score.

Pillar 5: Citizenship Timeline

The Citizenship Timeline Pillar looks at the average time taken for citizenship to be secured by the applicant.

The speed at which application forms and supporting documentation are processed, and the steps involved in approving an application, vary between programmes. Therefore, a thorough inspection of applicable laws, regulations, and policies was made to determine the official processing times mandated by each jurisdiction.

Extensive reliance was also placed on the first-hand experience of applicants, agents, and other stakeholders, whose contributions proved to be an invaluable tool in ascertaining citizenship timelines.

One of the key merits of CBI programmes is their ability to provide a rapid route to second citizenship; as such, the highest number of points was awarded to the programmes with the shortest turnaround times.

Additional merit was given to programmes offering fast-track processing options (even if at an additional fee), as these provide an extra layer of certainty for the applicant who is urgently in need of second citizenship.

Pillar 6: Ease of Processing

The Ease of Processing Pillar measures the end-to-end complexity of the CBI application process. In some jurisdictions, the application process can be a labour-intensive and painstaking task that is time-consuming for the applicant; in others, it is streamlined and the applicant receives clear directives on how to proceed. The overall effortlessness of the application process is a particularly important component and the promise of a smooth, hassle-free process can generate readiness to engage with a programme.

Multiple indicators were considered, commencing with entry qualifications such as previous business experience, a proven track record of achievement, or fluency in a language. Knowledge of local history or culture assessments and interview requirements were also weighed.

By its very nature as a naturalisation process, CBI involves a significant amount of paperwork, including both forms and supporting documents. Having the support of an official government website and of a dedicated CBI body to seek and obtain clarification was thus a factor in awarding points to a programme.

Extensive communication with advisors and legal experts is required where a jurisdiction mandates the purchase of real estate or other assets, and hefty paperwork must also be submitted as evidence of that purchase. Therefore, countries with compulsory purchasing requirements were deemed to burden the application process.

Programmes with fewer demands placed on the applicant, and with relatively straightforward procedures, achieved higher scores for this pillar.

Pillar 7: Due Diligence

The Due Diligence Pillar focuses on each nation’s commitment to ensuring that their programme remains transparent and effective at evaluating potential candidates for citizenship. It is, therefore, a measure of each programme’s integrity.

The CBI Index focuses on the ability of governments to obtain information on and from applicants, such as by the performance of internal and external due diligence checks. Indicators comprise police certificate requirements – including the number of nations from which a certificate must be provided – as well as requests for fingerprints or biometric data.

Emphasis was also placed on a country’s ability to gather evidence on the applicant’s source of funds, as this is a core step in denying citizenship to those profiting from, or involved in, the financing of illicit activity.

Increasingly, strict anti-terrorism and anti-money laundering (AML) legislation has prompted some governments to exclude persons of certain nationalities from their programmes or to restrict funds transferred from certain jurisdictions, in order to ensure compliance with international sanctions. These current trends are included among this pillar’s indicators.

The greater a country’s ability to perform background checks on applicants, the higher the score attained.

Pillar 8: Family

The Family Pillar measures the extent to which investors can obtain citizenship with their immediate and extended family.

The CBI Index recognises that the rise of increasingly complex family relationships is driving investors to seek programmes that allow for a more diverse range of family members to be included under a primary application. Indeed, while the large majority of CBI programmes provide for the inclusion of spouses and minor children, only a handful of countries do so for adult children and extended family. Introducing an additional layer of nuance to its scoring system, this year’s CBI Index also draws a distinction between family members who are allowed to apply with, and obtain citizenship at the same time as, the main applicant, and those who can apply at a later stage and as a consequence of the main applicant having already received citizenship.

Multiple family member categories were considered, with points being awarded for adult children, parents, grandparents, and even siblings. Additional merit was also given to programmes with provisions for family members of the main applicant’s spouse.

Additionally, the degree of flexibility within each of these categories can differ radically from programme to programme. In the adult children category, for example, programmes that allow for the inclusion of children aged 18 years or above with few restrictions achieved the most points. Those that require proof of a high degree of dependency – for example with a requirement that the child be in full-time education and fully supported by the main applicant – achieved fewer points.

As inclusivity has become an issue of global importance and increasingly relevant to the CBI industry, a point was awarded to those programmes that make provision for dependents living with a disability.

Pillar 9: Certainty of Product

The Certainty of Product Pillar encompasses a range of factors that measure a programme’s certainty across five different dimensions: longevity, popularity and renown, stability, reputation, and adaptability. With the CBI industry continuing its rapid growth, it is more important than ever to provide investors with a means of differentiating a programme’s relative robustness.

‘Longevity’ measures the age of a given programme. ‘Popularity and renown’ evaluates the number of applications and naturalisations under each programme per year, as well as a programme’s eminence in the industry.

As applicants and service providers prize continuity throughout the application process and beyond, the stability of each programme was also assessed. Here, importance was placed on whether any calls to end a particular programme have been made by authorities within or external to the CBI jurisdiction.

Additionally, countries with no cap on the number of applications that can be processed over the life of the programme scored more highly than jurisdictions that imposed a yearly maximum or a fixed total over a given period. For example, Montenegro’s CBI programme is both time- and volume-limited, with the government planning to end the scheme after 31 December 2022 and limiting the total number of investors to 2,000.

The reputation of a programme was determined by the amount of negative press or the number of scandals it has been linked to, affecting investors’ broader perceptions of the countries in which they invest. Just as important, however, is evidence that programme funds are being utilised for social good. Points were awarded for a jurisdiction’s transparent use of CBI funds, for example for the development of domestic healthcare, education, tourism, and other infrastructure.

Lastly, ‘adaptability’ reflects a programme’s ability to rapidly respond to, and sometimes even predict, the needs of applicants and the industry. Additionally, it assesses a programme’s responsiveness to major global events such as the Covid-19 pandemic and the war in Ukraine which, respectively, have had a significant impact on global mobility and due diligence requirements. More points were awarded to jurisdictions that have shown capacity to communicate with applicants, prospective applicants, and stakeholders – and to tweak their requirements accordingly.