After implementing a drastic 50 percent reduction in its required donation for economic citizenship last month, which prompted Antigua and Barbuda to go even lower, the Citizenship by Investment Unit (CIU) – and by extension the government of St Kitts and Nevis – now says it “remains resolute in protecting the high standards associated with the federation’s citizenship by investment (CBI) programme” and “will not engage in a race to the bottom,” reports Caribbean News Now.
The St Kitts and Nevis’ CBI programme presently has three distinct citizenship options: the real estate product priced at US$400,000, the Sugar Industry Diversification Foundation (SIDF) option at US$250,000, and the recently introduced Hurricane Relief Fund (HRF) option where investors can make a non-refundable contribution of US$150,000.
The Hurricane Relief Fund option, which was introduced last month, will be available for a period of six months, although St Kitts and Nevis has never satisfactorily explained who they expect to make a donation of $250,000 when the same benefit is available at $150,000.
Chief executive officer of the CIU, Les Khan, stated that there is a consensus among international marketing agents that there has been “consistent excellence and professionalism associated with the platinum brand of the St. Kitts and Nevis Citizenship programme: the oldest and best programme in the Caribbean.”
During a recent trip to the Middle East, Khan reassured agents that St Kitts and Nevis has not engaged and “will not engage in a race to the bottom.”
Khan explained, “We originally set a price that we felt was competitive, but was also one that maintained the standard of a platinum brand and one that was still higher than everyone else’s. There will be further adjustments, I believe, by other countries but we will not be engaged in that race to the bottom.”
This point was also articulated by St Kitts and Nevis prime minister, Dr Timothy Harris, when he addressed members of the media during a press conference held last Wednesday.
Harris noted that his administration will always seek to maintain the platinum standard of its CBI programme and claimed that St Kitts and Nevis has not reduced the price of any of its CBI products, but instead is now offering a third option in the form of the HRF – an apparent distinction without a difference.
“Having regard to the reality of the hurricanes, we had to address that via a new offering. We are not giving undue consideration to what has happened in Antigua or in any other country. We remain focused on promoting and marketing our programme as the one which the discerning investor would want to pay attention to, and we would want to invite those investors who are looking for an enduring relationship with our country and not just for the mere acquisition of citizenship,” Harris said.
The prime minister added, “We do not have an OPEC-like arrangement where countries participating in the citizenship programme come together and determine the price, and so each country, each jurisdiction at its sovereign wish, would make those judgment calls, and we respect that and we will let the market play out in terms of its responses to these issues.”
Khan earlier reported an increase in the level of interest in all three CBI offerings of St Kitts and Nevis, as well as the signing on of five additional international marketing agents to promote the federation’s CBI programme.
Opposition leader Dr Denzil Douglas has claimed that the new citizenship option is “a watered down CBI initiative that has not been ratified by Parliament”.
He said in statement that “it raises legitimate serious questions as to the validity of the citizenship and the passport that will be derived from it”.
While Khan recently highlighted a number of different steps in the due diligence process conducted by the CIU, he made no reference to the ongoing difficulties that may be experienced by holders of St Kitts and Nevis passports in conducting financial transactions in the US as a result of a still extant US Treasury’s Financial Crimes Enforcement Network (FinCEN) advisory.
Specifically, FinCEN believes that illicit actors are abusing the St Kitts and Nevis programme to acquire citizenship in order to mask their identity and geographic background for the purpose of evading US or international sanctions or engaging in other financial crime.
In particular, FinCEN advised that US financial institutions should conduct risk-based customer due diligence to mitigate the risk that a customer is disguising his or her identity with an St Kitts and Nevis passport in order to evade sanctions or engage in other financial crime.
Article compliments IFC Review.