Will Portugal´s dream investor program recover from its own internal backlashes?
Spoiler alert, the answer is yes. But will everything be smooth sailing from now on?
The Portugal Golden Visa has become one of the most popular residency-by-investment schemes in the world, welcoming investors from the world over to the sun-drenched shores of Portugal. However, recent concerns regarding the processing of Golden Visa applications are of a far less sunny disposition.
Issues within SEF (Serviço de Estrangeiros e Fronteiras or, in English, the Foreigners and Borders Service), such as the proposed extinction of the department, plus backlogs due to the COVID-19 pandemic, and now the Ukrainian War, have created substantial delays for Golden Visa applicants.
With this said, as of 13 June 2022, SEF has resumed accepting new Golden Visa applications, pre-approvals are now being processed and the backlog is decreasing considerably. As far as we know, SEF is currently analyzing applications from November 2021 for households that have been completely pre-approved. Since the last quarter was, predictably, the one with the most volume of applicants, it is expected that there will be slow processing until they manage to cover the end of 2021. Nonetheless, the current state of play suggests that the cog is turning and things are steadily grinding back to normal.
Looking to the future, there are favorable conditions for the process to speed up considerably in the near future.
However, despite these affairs abating somewhat, what do these internal matters within SEF mean for the future of Portugal’s Golden Visa in the coming months?
What is the Portugal Golden Visa?
Portugal’s Golden Visa Program is the country’s exceptionally successful residency by investment scheme, which has seen 10,748 investors benefiting from the scheme since it was launched in 2012, generating an impressive €6 338 112 974,07 in funds.
Advantages of the program include access to 27 countries in the EU, visa-free travel to 183 countries, plus affordable investment options starting from 250K. The flexibility of the program, plus the tax benefits that can be unlocked under the non-habitual residence (NHR) scheme are further ticks in the boxes for expats seeking Portuguese residency.
Cracks from all sides
Despite the continuing success of the Portugal Golden Visa, the greatest setback could very well be of the country’s own making. Internal issues within SEF, coupled with external issues outside their control, have created much havoc with their ability to manage Golden Visa applications. How they are responding will be crucial in determining the desirability of the program in the future.
There has been some discussion on the reconvening and restructuring of SEF, and even calls for the extinction of the department to be replaced by the Portuguese Agency of Migration and Asylum (APMA) or possibly only transferring to them the registry and notary office, and providing the police with greater management of border control. However, there could still be many twists and turns to the reshuffling of SEF, which will only come to light in the coming months.
Obviously, this coverage has been creating a lot of political pressure on the department and a high level of uncertainty among workers, leading to strikes and widespread instability. For example, there have been a few cases where waiting queues have been over four hours for some non-EU arrival flights, creating many issues at Lisbon airport and talk that the airport may have to “refuse flights” next year as they seek to solve the airport situation in the capital.
Yes, SEF has seen better days and has been encircled by upheavals and complications on all sides, both within its walls and from outside. But we have good news.
The turn of the tide
The clouds seem to be finally parting, providing some relief to Golden Visa applicants. On 13 June 2022, SEF resumed accepting new Golden Visa applications, pre-approvals have now been processed. While the backlog is tremendous, things are speeding up, and this time in the right direction. In fact, biometrics appointments from mid-September to November are missing, and the processing pre-approval and biometrics appointments scheduled for December are missing, but after this, the process should speed up considerably. From January to June there will be no new processes, as the backlog up until this point will not be as critical as predicted.
At the time of writing, SEF has notified and made available an agenda for biometrics for households in which all members have been pre-approved and who have applied in the first half of September. This is good news, as it highlights that the SEF service that has been blocked for many months is steadily getting back to normal. Alongside this, in the longer term, the revamp of SEF could pay dividends and help restructure the entire process, making it easier for the department to structure itself and have clear internal ambitions and goals to streamline its work.
Portugal has proved to be resilient in the past and has walked away as the winner before, overcoming the crisis following the 2008 recession with an emphasis on tourism and promoting its real estate market, such as through the Golden Visa program.
Similarly, in 2017, the year saw an unprecedented increase in Golden Visa applications and, despite a backlog of 4,000 Golden Visa applications due to a lack of staff, SEF managed to get the job done, with applicants at the time dwarfing previous years. The recent appointment of SEF’s new National Director has also brought positive reinforcement, and we have already seen the results of his determination and motivation to detangle the effects of the past few years and steer the ship in the right direction.
Will Portugal’s dream investor program come off the rails?
Despite all the unlikely factors that have clearly affected the processes for SEF, there seems to be a light at the end of the tunnel, and very favorable conditions seem to be in place for the processing of Golden Visa applications to stabilize relatively quickly. The government, with a very strong parliamentary majority, supports SEF and has already presented a text of amendments to the immigration law, that reinforce and diversify the various immigration options. The decree that regulates immigration law is expected, at the same time, to make the procedure more efficient and streamlined, in addition to clarifying proceedings.
The appointment of the new National Director of SEF, and the trust that was placed in him at a critical moment for SEF, emphasizes this. So much so that, even with the restructuring, or even the extinction of SEF, on the horizon, there is enough political confidence to be able to take extraordinary measures to open mass appointments as has been happening in recent weeks.
Looking to the future, we have enough stability now, alongside an unshakeable and unequivocal will, to ensure that there are favorable conditions for the resumption of the investment program in Portugal.
All things considered, given the past history of the country to bounce back from adversity — such as with the 2008 financial crisis and how the Golden Visa Program was instrumental to the country’s recovery — it’s pretty safe to say that, although it may take some time, SEF will get back on track and the Portugal Golden Visa will run like clockwork once again, hopefully in the near future. Under the leadership of the new National Director of SEF, we are hoping for the provision of a better, streamlined application system that will be up and running as soon as possible, putting Golden Visa applicants’ very real concerns to rest.
