Pipeline of €318m in foreign investments stalled by red tape
Fears Ireland will lose out over Immigrant Investor Programme backlog of 348 out of 422 applications
Investments totalling at least €318m planned by wealthy foreigners in businesses and cultural activities in Ireland under the Government's Immigrant Investor Programme have been stalled by lengthy processing of applications, the Irish Independent has learned.
The processing times have led to anecdotal evidence that some potential investors are ditching plans to bankroll firms here and instead opting for similar schemes offered by countries such as Malta.
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But the Department of Justice has insisted that its average processing time of between six and nine months for 2019 "compares favourably" with international peers, some of whom it claimed take between 12 and 24 months to process applications for similar schemes.
The Immigrant Investor Programme (IIP) is being widely used to secure investments from groups of foreigners for single projects such as housing, primary care centres or nursing homes. When the IIP was launched in 2012, a key objective was the creation and supporting of employment.
The Department of Justice conceded in a previous evaluation of the scheme for the 2012-2016 period that it was "very difficult" to estimate the exact number of jobs potentially supported by the IIP.
The scheme enables foreigners from outside the European Economic Area to secure residency in Ireland for an initial period of two years. The residency can be extended up to 10 years if certain criteria are met, and successful applicants and their families don't have to actually live in Ireland, but must visit once a year.
To qualify, the applicants must apply to invest via the programme in one of four categories.
One option is to invest at least €1m across any number of Irish companies for a minimum of three years. The businesses can be a startup established by the investor, or an existing business registered in Ireland. The investment must support the creation or maintenance of employment.
Alternatively, investors can opt to make a minimum investment of €1m in an approved investment fund; invest a minimum of €2m across real estate investment trusts listed on the Irish stock exchange; or provide a minimum philanthropic endowment of €500,000 to be used in a project to benefit the public in the arts, sport, health, cultural or educational fields.
Since it was introduced, there have been 1,200 applications made under the IIP.
Just 726 applications have been approved.
The Department of Justice and Equality has insisted that the average processing time for applications is four months. However, it also conceded that of the 422 applications received in 2018, 348 are still being processed.
Of the 348 outstanding applications, 100 were submitted eight months ago, and 248 submitted six months ago.
The Department said that a decision on a "significant number" of outstanding applications is expected in coming weeks.
It added that last year a number of enhanced control mechanisms were introduced to ensure the IIP operates "in the most open and transparent fashion".
Justice Minister Charlie Flanagan has commissioned a "major external review" of the IIP, which is expected to be concluded in the second half of the year.