ee

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Table of Contents

LIST OF ACRONYMS 5

SETTING THE CONTEXT 6

EXECUTIVE SUMMARY 8

INTRODUCTION 11

BACKGROUND TO CITIZENSHIP BY INVESTMENT PROGRAMMES 13

Reasons for seeking Citizenship by Investment 13

Country Benefits 14

Risks 16

EXISTING CIP’S 17

Dominica 17

St. Kitts & Nevis 18

Austria 20

A MODEL FOR CONSIDERATION 21

General Provisions 21

Investment Options 21

Investment Qualifications 22

Features of the Passport 22

Eligibility Requirements 22

Fees 23

Special Areas: Resort Districts 24

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LEGISLATIVE AMENDMENT/FRAMEWORK 27

DUE DILIGENCE 28

Documentation 28

In-House vs. Outsourcing 30

Due Diligence Criteria 31

Interview Panel 31

Potential Providers of Due Diligence Service 32

SPECIAL ADVISOR 35

ECONOMIC IMPACT 37

Real Estate Option 40

Business Option 42

National Development Fund 42

Charitable Fund 43

A Desirable Out-come Philanthropy 44

INSTITUTIONAL SETTING 45

Process Flow 48

Citizenship by Investment Agents 50

Criteria for Granting of C.I. License 50

The Procedure for Obtaining a License 51

CONCLUSION 53

SUMMARY OF RECOMMENDATIONS 54

Features of Citizenship by Investment 54

Eligibility Requirement 54

Investment Qualifications for Citizenship 55

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Revocation 55

Fees 56

Special Areas: Resort Districts 56

Due Diligence 56

Institutional Setting 57

ANNEX 1 58

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LIST OF ACRONYMS

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SETTING THE CONTEXT

Since 2009, Antigua and Barbuda has struggled with the challenge of a declining

economy that has contracted due to the global economic and financial crisis as well as

systemic domestic imbalances and shrinking revenues. The country has long needed a

public investment programme, which would secure resources for development.

In the recent past, Antigua and Barbuda, and countries all around the globe have

confronted grave challenges in their efforts to satisfy the expectations of the citizenry.

External factors have played a pivotal role in determining the success or failure of our

small island developing states. The enduring impact of the global economic and financial

crisis continues to constrain Government’s ability to ensure high levels of employment, to

provide critical social services, and to undertake much needed infrastructural

development.

While the Government and people contend with the reality of economic stasis, traditional

funding sources have virtually disappeared for countries such as Antigua and Barbuda

which is ranked as “high” on the Human Development Index, positioned as 60 of 187

countries. Moreover, Official Development Assistance (ODA) to Small Island Developing

States increased more than 30% over the period 2006 – 2008, but for Antigua and

Barbuda it fell 71%. Through building on bilateral relations with developed and emerging

states, the Government has secured concessionary financing for several projects.

However, these arrangements are generally executed at the behest of the donor. Even as

we register our appreciation for the support received from these generous states, we

must endeavour to chart a course for greater self-determination which empowers us to

more fully direct the pace, impact and outcomes of our development initiatives.

Historically, countries such as ours have adopted, in many instances, a reactive stance to

Foreign Direct Investment. We have been proactive in facilitating the investor at the

point of his proposal but we have not always adopted a strategic, targeted and

programmatic approach to how this development would unfold. Experience has

demonstrated, without question, that sustainable economic development is best achieved

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by adopting an integrated and holistic approach. The Citizenship by Investment

Programme is one such facet of this approach.

Our adoption of a Citizenship by Investment Programme is based on our confidence that

it will:

• Promote economic growth, bolster job creation and fuel entrepreneurship;

• Attract developments which create ongoing and sustained tax revenues and

other forms of income;

• Generate significant capital injection annually into the national economy;

• Support the development of infrastructure. and

• Ensure that nationals continue to have access to affordable lands.

In the CIP as currently constructed, an investor may apply for citizenship through four

mechanisms:

• The Real Estate Option which allows him to purchase property in Antigua and

Barbuda with a minimum value of US$400,000.00 in a designated resort zone.

• A contribution of minimum US$200,000.00 to a National Development Fund.

• A contribution of minimum US$200,000.00 to an approved Charitable Fund

• A business investment of no less than US1.5 Million as a single investor or of

US$4 million in which two or more persons contribute at least US$400,000.00 .

Individuals who successfully undergo the rigorous due diligence and interview process

and who make the required investment will be granted citizenship.

The Government is well aware of the value of the Antiguan and Barbudan passport and

how passionately and with what great esteem the people of our twin-island nation regard

this document. We are resolute that the Citizenship by Investment Programme should in

no way jeopardize the integrity of the national passport. As such, we have structured the

Citizenship by Investment Programme to meet the most incisive scrutiny and to ensure

that applications received by the CIU undergo the most rigourous review by the

international Due Diligence Service Providers selected by the CIU.

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EXECUTIVE SUMMARY

The Government of Antigua and Barbuda is exploring the possibility of embarking upon a

Citizenship by Investment Programme (CIP). A Taskforce consisting of members of the

public and the private sector was convened in June 2011, to examine the feasibility of the

programme and make recommendations. This report documents its findings and

recommendations.

A Citizenship by Investment Programme can greatly complement the residential tourism

product and contribute to economic and social development. Given the experience of

other jurisdictions, the Task Force recommends the establishment of a Citizenship by

Investment Unit under the portfolio of the Prime Minister. However, the Task Force

strongly advocates that the staff selected for this Unit should be highy committed and

dedicated individuals who will act as watchdogs to protect the country’s reputation and

mitigate the potential risks and any threat to the integrity of the Antigua and Barbuda

passport.

A key component of the CIP is the Due Diligence Process. The country should therefore

capitalize on the knowledge and experience of specialized agencies such as Kroll, Ernst

and Young and Bishops Services Inc., Risk Advisory Group, IPSA, etc. by outsourcing these

services to them.

Citizenship by Investment programmes have the potential of exerting a powerful

inflationary effect on land prices, if left unchecked. In order to ensure that the price of

land ownership remains within the reach of the average Antiguan and Barbudan, only

properties located in specially designated zone termed, Resort Districts, would qualify.

In order to qualify for Citizenship under the programme, four options are offered:

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1. Real Estate: Applicants for citizenship must acquire property valued at least

US$400,000.00.

2. National Development Fund: Contributions to the National Development Fund

(NDF) in the amount of US$200,000 for a single applicant.

3. Charitable Fund (CF) Contribution: Contribution to approved non-profit

charitable institutions focused on education, health and environment in the

amount of US$200,000 for a single applicant.

4. Investment in a Business: Business investment starting at US$1.5 million.

Investment in a business can be with multiple Investors who jointly invest at least

US$4million. The minimum investment to be made by a single investor is

US$400,000.00.

- Funds will be paid into an escrow account held by a bank or a well

recognized accounting firm as escrow agent before citizenship is granted

- All government fees and Due Diligence fees apply in addition to the

investment

The National Development Fund (NDF) route to citizenship by investment is a strategic

capital mobilization measure aimed at funding government sponsored schemes to

promote public sector projects that will generate income; and or innovation in private

sector entrepreneurship. Additionally, there should be a charitable option to enable

applicants to make a contribution to registered non-profit organizations approved by the

Minister that deliver services in Education, Health, Sports, Youth Development and

Environmental management.

The National Development Fund (NDF) is to be administered by means of a Special Fund

established under section 42(2) of the Finance Administration Act, 2006. The Act

authorizes the Minister of Finance to make provisions for the administration of the

Special Fund. Given the extremely controversial positions that exist in relation to the

administration and use of such a fund, specific recommendations have been drafted.

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In the medium term, the CIP can yield US$228 million in annual inflows to the country.

This is based on five hundred successful applicants per year, starting in year four.

The Task Force strongly recommends that the Government moves with haste and

thoroughness to initiate a Citizenship by Investment Programme.

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INTRODUCTION

The Taskforce for the consideration of a Citizenship by Investment Programme was

convened by the Antigua and Barbuda Investment Authority on June 9, 2011. The

membership of the Taskforce was drawn from the private and public sector, more

specifically:

• Permanent Secretary, Ministry of Foreign Affairs, Sandra Joseph

• Ministry of National Security, Chief Immigration Officer – Lt. Col. Ivor Walker

• Min. of National Security, Immigration Dep., Station Chief (St. John’s) – Joycelyn

Hughes

• Office of National Drug and Money Laundering Control Policy – Lt. Col. Edward

Croft

• Caribbean Developments (Antigua) Ltd. – Gaye Hechme

• Bar Association – Arthur Thomas, President (who succeeded Kelvin John)

• Antigua and Barbuda Investment Authority – Fitzmaurice Christian

In October 2011, the following members were added:

• OBM Ltd. – Brian D’Ornellas

• Hill and Hill Chambers – Radford Hill

The Terms of Reference for the deliberations are noted hereafter:

i. To identify the best strategic options available to support investment and

residential tourism.

ii. To identify the risks and necessary safeguards that should be in place to maintain

the integrity of the Antigua and Barbuda passport.

iii. To examine the economic benefits which may result from citizenship by

investment/permanent residency.

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iv. To determine the legislative and regulatory amendments required for the

recommended course of action.

v. To establish an institutional framework to manage the programme.

Meetings were held throughout the months of June and early July however, due to

demands on members, no meetings were convened in August and September. Regular

meetings resumed in October 2011.

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BACKGROUND TO CITIZENSHIP BY INVESTMENT

PROGRAMMES

Citizenship by Investment is the granting of citizenship status to an individual (and

immediate family members) contingent upon a specified and quantifiable investment in

the country. Alternatively, residency rights may be offered, in which case this is referred

to as an immigrant investor programme.

While many countries offer residency visas to investors and wealthy individuals, there

are only a few countries now which have clear provisions in their laws to grant citizenship

by investment and without residency requirements. The USA, Canada, Australia, Austria,

Switzerland and Great Britain are among the countries which offer residency and a

fastrack to citizenship to wealthy individuals for their investment in their country.

Why do individuals value/seek out citizenship opportunities?

The benefits of dual or multiple citizenship range from ease of movement; where there is

political strife in one’s own country and investment planning and personal security.

i. Convenience: High net worth citizens of some countries spend considerable

amounts of time obtaining visas from other countries. In addition to the time

involved in the process, and the uncertainty, is the fact that some countries only

offer single entry visas. Where travel may be required on short notice, access to

another passport may be crucial such as in the case of civil unrest. Additionally, a

second passport may afford the holder visa-free travel to jurisdictions not

available to his country of birth.

ii. Tax Planning: Several countries levy income tax on non-resident citizens.

Alternative citizenship has therefore become increasingly important as an

effective tool for international tax planning. As a national of two or more states,

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an individual generally has more planning options as well as more privacy in

banking and investment.

iii. Personal Security: Citizenship and a passport from a small, peaceful country is

considered by some as a form of protection when travelling, particularly in times

of political unrest, civil war, terrorism or other delicate situations. Many

international business executives consider an alternative passport as the best life

insurance.

iv. Investment in the Future: In a dynamic political and economic environment,

acquiring a second citizenship may be considered an investment for the future

and in many instances, there is no need to give up one’s present nationality while

one, along with his family, enjoy the benefits of a legal second passport.

Country Benefits

The implementation of a Citizenship by Investment Programme can be a mutually

beneficial arrangement for applicants and the host country. Among the gains to the

country are:

i. Economic Development: Antigua and Barbuda is considered a middle income

country and hence unable to access official development aid at concessionary

rates. The country is also heavily indebted with very little fiscal space for

infrastructure and investment in education, health, sports, youth development

and environmental management.

ii. Economic Diversification: The island is heavily dependent on tourism (over 70%

of GDP). However, potential entrepreneurs are often confronted by a financial

services industry that is risk averse. The National Development Fund will provide

a catalyst to create venture capital fund to support the next generation of

business ideas to sustain lasting economic growth and diversification.

iii. Capital mobilization: The revenue stream generated by investments and

processing fees can be considerable. This is projected to be over US$32 million

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(EC$86 million) in Year 1, US$104 million (EC$283 million) in Year 3 and US$282

million (EC$615 million) annually by Year 5.

iv. Liquidity Replacement: The failure of British American Insurance led to the

exodus of over EC$300 million from the local financial system. Fees and

investment in the NDF, Real Estate Investment, and the Charitable Trust will help

to replace the liquidity lost by the system.

v. Improve Foreign Reserve Position: The CIP is denominated in United States

currency. All the fees, investments etc. collected will help to provide hard

currency for Government and businesses to meet their external obligations. This

is especially critical in an environment of stagnant visitor arrivals and financial

crises in our major source markets.

vi. Increased foreign direct investment (FDI): Apart from the initial investment for

property purchase or other investment vehicles, opportunities for business

investment in communities may be pursued. Citizens by Investment are usually

very high net worth individuals who bring skills, resources and a network of

relationships ideal for business development.

vii. Increased economic activity: If applicants select the real estate option, this is

likely to generate significant economic activity in construction, retail, insurance,

property management, utilities, infrastructure, legal services and Government

taxes such as land transfer taxes, property taxes, ABST and import duties as well

as other services in the private sector.

viii. Investor Confidence: A popular model for hotel development is the condo hotel.

In this model, condo units are purchased before commencement of construction

by the investor and on completion placed in a pool under a hotel management

contract. The Citizenship by Investment policy will make the country more

attractive both for the developer and the investor because of the added incentive

of citizenship.

ix. Impact on tourism: There is a requirement that each successful applicant spends

at least 15 days in the country each year for the first five years to qualify for a

renewal of his passport. This should provide a much needed boost to the tourism

market and result in the diversification of the tourism product as homes bought

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by citizens by investment may be made available for use by their family, friends

and their business associates.

x. Impact of presence of a network of high net worth individuals: Considerably

wealthy individuals may be encouraged to support community projects and

worthwhile initiatives through charitable contributions and the establishment of

foundations.

Risks

While the implementation of a Citizenship by Investment Programme can offer significant

benefits to the host country, there is need to assess and weigh the risks associated with

such an initiative. Among these risks are:

i. Management and employee selection, agent selection: The integrity of the

programme hinges largely on the personnel charged with its promotion and

administration.

ii. Deviation from established policies and procedures: It is the intention of the

Taskforce and the Government of Antigua and Barbuda to develop and

implement the most rigorous screening and administrative protocol to ensure

that the programme is not compromised. It is therefore critical that a thorough

system of checks and balances complement the service delivery component of

the CIP.

iii. Undetected fraud: There is the probability that an undesirable individual, despite

the CIP Unit’s best efforts, may acquire a passport.

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EXISTING CIPs

Existing Citizenship by Investment Programmes with formal legislative framework exist in

Dominica, St. Kitts and Nevis and Austria. The following reviews the general provisions of

these programmes.

Dominica

Dominica’s Citizenship by investment Programme is administered by the Financial

Services Unit in the Ministry of Finance. In 1993, the concept of Citizenship by

investment was introduced by way of an amendment to the Citizenship Act which waived

the residency requirement. This amendment to the Citizenship Act meant that for a

stipulated investment, persons could apply for Dominican citizenship.

Investment Options

• Family Option - Cash Investment:

Under this option, the investor-applicant pays US$200,000 which qualifies the

investor, spouse and two (2) children under eighteen for citizenship by

investment. An additional US$15,000 per child is required for children who have

turned 18 years but are less than 21 years old. Also, a cash contribution of

US$25,000 is required for any additional child over twenty-one (21).

• Single Option - Cash Investment:

A Single Option application is defined as one where the investor (whether single

or married) is the sole applicant for citizenship by investment. Under this option

the "Single" investor would be required to make cash investment of US$100,000

which would be directed towards public sector financing.

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Other Applicable Fees:

• Processing fees - US$1,000 per investor (Non-refundable)

• Processing Fee - US$200 per applicant (Non-refundable)

• Naturalization Fee - US$550 per applicant

• Stamp Fee - US$15 per applicant

Citizenship is guaranteed for life and the passports are valid for ten years in the case of

adult holders and five years for children. Holders of the Dominica CIP passport enjoy tax

free status on foreign income; capital gains; gift, wealth and inheritance taxes.

St. Kitts and Nevis

The Citizenship-by-Investment Unit (CIU) is the Government Authority which handles all

matters concerning citizenship by investment in the Federation of St. Kitts and Nevis. The

Citizenship-by-Investment Programme was established in 1984, making it the longest

established programme of its kind in the world. The programme was reformed

substantially in 2007, when Henley & Partners was mandated by the Government to

advise on and implement such reform, and thereafter globally promote the program.

Since then, the St. Kitts and Nevis program has become the most successful program of

its kind in the world.

The Government of St. Kitts and Nevis utilizes this programme to attract investors of

good character to make a substantial contribution to the development of the Federation.

These investors are then given the opportunity to apply for citizenship and passports

within the strict guidelines of the law and the relevant regulations.

The Programme operates on constitutional, legislative and regulatory foundations.

Under current regulations, to qualify for citizenship of St. Kitts and Nevis under its

Citizenship-by-Investment Program, the Government requires an investment in one of

two designated programmes. The first of these is investment in real estate with a value of

at least US$ 400,000 plus payment of various registration and other fees. Only villas and

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condominium units from an approved developer qualify an applicant for citizenship.

Alternatively, a contribution to the Sugar Industry Diversification Foundation (SIDF) - a

public charity - of an amount between US$250,000 (includes Government fees) and US$

500,000, (includes Government fees) depending on the number of dependants included

in the application, is another medium by which an applicant may become eligible. . The

SIDF offers four categories:

a. Single applicant: a non-refundable contribution of US$250,000.

b. Applicant with up to three dependants (i.e. one spouse and two children below

the age of 18): a non-refundable contribution of US$300,000.

c. Applicant with up to five dependants (i.e. one spouse and four children): a

nonrefundable contribution of US$350,000.

d. Applicant with up to seven dependants: a non-refundable contribution of

US$450,000 is required

In each of these categories, the amounts include all Government and due diligence fees.

In the case of unmarried dependent children who are older than 18 but younger than 25,

they can also be included in the same application provided an additional fee of

US$35,000 is paid to the Government.

With the real estate option, in addition to the investment requirement, the following

processing and due diligence fees are payable to the Government of St. Kitts and Nevis:

• US$50,000 for the main applicant

• US$50,000 for the spouse

• US$25,000 for any dependent children below the age of 18

• US$50,000 for any dependent and unmarried children older than 18 but younger

than 25. Children over 18 years but below 25 must be in a full time learning

institution and fully supported by parents.

• US$4,000 due diligence fee per person older than 16 included in the application

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Austria

Austria offers a form of citizenship-by-investment programme, albeit extremely expensive

and not a certainty.. The applicant is required to actively invest in the Austrian economy in

order to create jobs. A minimum investment of at least €2million is mandatory. Passive

investments in bonds and real estate do not qualify. Additional fees of €250,000 or more

apply, depending on the applicant.

Having examined several models, the Task Force developed its own structure for the

proposed Antigua and Barbuda model.

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A MODEL FOR CONSIDERATION

The Task Force recommends that the framework for the proposed Citizenship by

Investment Programme should meet the criteria which allows for:

1. Promoting economic growth, local entrepreurship and job creation

2. A model based on existing similar global programs

3. Attraction of developments which would stimulate economic activity, new tax

revenues and other forms of income which would be ongoing and sustained

4. Generating significant resources annually of direct capital injection into the

national economy

5. Development of infrastructure – roads, sewage treatment plants etc.

6. Attracting developers with financial competence and experience

7. Ensuring nationals continue to have access to affordable lands

General Provisions of the CIP

• The Citizenship by Investment Programme should in no way jeopardize the

integrity of the national passport

• That there be no dislocation or disenfranchisement of nationals particularly with

respect to the ability to purchase and own lands

• Properties to be purchased will be in designated zones approved by the

Government.

INVESTMENT OPTIONS

Applicants to the CIP can choose from any of the following investment offers:

• Property purchase

• Business investment

• Contribution to National Development Fund (NDF)

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• Charitable contribution to a registered and regulated non-profit organization

which provides services in education, health care, sports, youth development and

environmental management.

INVESTMENT QUALIFICATIONS:

• Applicants for citizenship must acquire property of at least US$400,000.00.

• Contributions to the National Development Fund and Charitable Fund would be

US$200,000 for a single applicant.

• Business investment for citizenship would start at US$1.5M.

FEATURES OF THE PASSPORT

• The passport would be valid for a period of 5 years

• The right to vote is not automatically conferred through becoming a citizen

under the CIP. The provisions of the Representation of the People’s Act will

apply.

ELIGIBILITY REQUIREMENTS

• On completion of the necessary due diligence process and receipt of a favourable

report, applicants may be required to attend an interview at the CIU.

• A certificate of good health must be presented by applicant.

• Individuals convicted of the crimes listed hereafter would not be eligible for

consideration:-crimes against humanity, drug trafficking and related offenses,

sexual offenses, capital offenses, money laundering, terrorism and its financing,

human trafficking, migrant smuggling and piracy.

• There would be no automatic disqualification of specific jurisdictions.

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• Applicants must deposit 100% of the contract sum after due diligence is

completed.

• A beneficiary of a CIP passport through property purchase must retain ownership

of property for a minimum of five (5) years. During the five years, the, property

may be sold as long as the CIP citizen acquires another property for at least

US$400,000.

• Purchase of a previously held property in a designated zone would not confer

automatic eligibility for citizenship.

• There will be a residency requirement of minimum 15 days annually or 75 days

over a 5 year period. Where upon application for renewal of a passport it is

determined that the CIP citizen has not fulfilled the residency requirement, he

would be required to comply prior to renewal.

• Applicants may be 18 years or older

• Dual (multiple) citizenship is allowed.

FEES

Table 1: Fee Structure

Fees US$Processing fee - Principal Applicant $50,000Processing fee - Spouse $50,000Processing - Dependent child aged 0-11 $25,000Processing - Dependent child aged 12-17 $25,000Processing - Dependent child aged 18-25 $50,000Processing- Dependent parent aged over 65 $50,000Due diligence fee - Principal Applicant $7,500Due diligence fee - Spouse $7,500Due diligence fee - Dependent child 0-11 $0Due diligence fee - Dependent child 12-17 $2,000Due diligence fee - Dependent child 18-25 $4,000Due diligence fee - Dependent parent aged over 65 $4,000Biometric Passport ($ 355 each) $355Promotional fees to Authorised Persons/Service Providers $20,000

All fees are paid by applicant. US$5,000 of processing fee is non-refundable.

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SPECIAL AREAS: RESORT DISTRICTS

The Task Force strongly recommends that only designated zones be considered eligible

for consideration under the real estate component of the CIP. Investment and

developments in these areas must form the subject of a scheme of development

agreement which defines the deliverables by the developer and their expectations of the

Government. The areas recommended in Antigua and Barbuda can be found in Appendix

1.

The objectives of the zoning are as follows:

1. To attract development in areas of Antigua and Barbuda that provides economic

opportunities for Antiguans and Barbudans and create new tax streams and other

forms of income. The projects must generate continuing economic opportunities,

tax revenues and other forms of income that will help to improve the quality of

life for the people of Antigua and Barbuda.

2. To facilitate the development of infrastructure facilities such as roads,

underground electrical networks and sewage treatment plants associated with

world class resorts.

3. To attract financially qualified developers with proven experience and success to

ensure that world-class resort developments and associated investments take

place.

4. To facilitate the granting of financial incentives through concessions in order to

achieve the above stated objectives.

5. To ensure that lands outside the designated areas remain affordable to Antiguans

and Barbudans.

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Developments could include:

• Luxury hotels

• Championship level or executive golf courses

• State of the art Marinas

• Resort related amenities

• Resort residential developments

• Resort commercial villages

Conditions for a Development

• A Project that meets the objectives of the Programme

• Property which is subject to purchase, sale, transfer, lease, license to a resort

developer for resort and related residential development through a scheme of

development agreement

• An existing resort that generates economic returns to the Government in the

form of transfer taxes, property taxes and capital gains tax.

• A proposed resort that is anticipated to generate significant employment,

educational, career development and/or economic opportunities for the people

of Antigua and Barbuda

• The resort developer is to construct the necessary infrastructure, utilities and

facilities to service the resort project

• The resort developer demonstrates that he/she has the capability, financial

capacity and other qualifications needed to accomplish the resort development

• Resort developer commits to taking appropriate initiatives and supports

Government’s efforts to achieve sustainable development including best practices

of environmental management.

• Agreements may include improvement to Government property, lease or

purchase of Government owned lands for development.

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Designation of Resort Districts

Resort District may encompass:

• A particular resort

• Properties of the developer that are currently owned by the developer that are

covered by the scheme of development agreement

• Properties to which the resort district may be extended under the terms of a

development with the consent of the Antigua and Barbuda Investment

Authority and prior approval of the Cabinet

• Any property that is designated by a resort developer, not owned by him, which

is incorporated into the resort development with the written consent of the

owner.

• Geographic area subject to the scheme of development agreement

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LEGISLATIVE AMENDMENT/FRAMEWORK

While Antigua and Barbuda may derive significant benefits from a Citizenship by

Investment Programme, these advantages will not be maximized unless it amends its

Income Tax Act, more particularly Part 111 Section 5 which reads in part “Income tax shall

… be payable … upon the income of any person accruing in or derived from Antigua and

Barbuda or elsewhere and whether received in Antigua and Barbuda or not…“. This is

termed taxation on worldwide income. As a result, any person who holds our passport is

potentially liable to pay tax on income earned inside or outside of Antigua and Barbuda.

The Task Force recommends an amendment to the legislation.

The Task Force is of the view that the legislative framework for the CIP programme should

be contained in a new Act of Parliament entitled the Antigua and Barbuda Citizenship by

Investment Act. The following Acts of Parliament will touch upon and have a bearing on

the new Act:

• Antigua and Barbuda Citizenship Act, Cap. 22

• Representation of the People Act. Cap 379

• The Finance & Administration Act, 2006

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DUE DILIGENCE

Due diligence represents the most important aspect of any Citizenship by Investment

Programme. The reputation of the Citizenship by Investment Programme will largely be

determined by the integrity of the bearers of our passport. This has significant

implications for the visa free travel currently enjoyed by our nationals as well as our

relations with other states

The most important steps within the due diligence processes are the background checks

and interviewing. Background checks ensure that there is no criminal history, validates the

identity and source of wealth, reputational check, physical health and the financial

condition of the applicant. Many firms which provide due diligence services offer

automated solutions but these are confined to countries of the West e.g. Europe and

North America which have established strong public disclosure laws due to a long history

of democratic tradition. However, there is a strong requirement to have an established

and trusted information network that pierces the veil into emerging economies where

there is less disclosure requirement. This is critical for countries and regions such as Brazil,

Russia, India, China, the Middle East and Africa.

Documentation

As part of the background screening process, the Government would require applicants

to provide the following:1

a. Certified Copy of current passport (s) showing name, photo,

citizenship/nationality, date and place of issue, expiry date, passport number and

issuing country.

1 The following is not intended to be an exhaustive list and will be supplemented by suggestions from due diligence agencies.

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b. Original excerpt of full birth record with apostile or certified copy of full birth

certificate (i.e. birth document that also includes parent's details, or a household

register, family book etc.).

c. Original Bank Reference Letter issued by an internationally recognized bank, not

older than 6 months indicating proof of funds. Original professional reference

(e.g. from an attorney, notary public, chartered accountant, or other professional

of similar standing), not older than 6 months.

d. Original document of evidence of residential addresses (e.g. certified copy of a

recent utility bill or bank statement showing full name and address, or written

confirmation from a bank, attorney, chartered accountant or notary public).

e. Original Police Record or Police Certificate from country of citizenship and

residency. (unless the applicant can provide satisfactory evidence that he/she has

never lived there) Document must not be older than 3 months.

f. Certified copy of military records (IF APPLICABLE).

g. Certified copy of proof of name change (IF APPLICABLE, i.e. statutory declaration,

adoption papers etc.).

h. Certified copy of current national identity card(s).

i. 6 original passport-size photos of the applicant taken within the past 6 months.

j. Investment Confirmation / Escrow Deposit Evidence - i.e. A copy of duly executed

real-estate contract (Purchase and Sales Agreement), evidence of Title Transfer

(either deed or certificate of title). Also copy of escrow deposit for purpose of

building.

k. Photograph and Signature Certificate.

l. Medical Certificate.

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IN-HOUSE VS. OUTSOURCING

1. Core competence: 2

2. Neutrality: Outsourcing due diligence will provide the Government with an

unbiased third party assessment of the applicant.

Expertise is a strong argument that speaks to outsourcing.

While in-house due diligence staff members may have significant experience and

expertise in the field, it is virtually impossible for them to be experts on the

specific risks and stages and across all jurisdictions. The Task Force recommends

that the CIU creates an aggressive staff training initiative to develop this

competence.

3. Cost: The applicant will pay all due diligence fees.

4. Global Access to Information: The service provider must have a network that

provides information from formal Government sources as well as non-traditional

sources via a network of local sources. Some due diligence companies pursue this

on a negative basis i.e. dig deep specifically for adverse information.

The service provider should provide among others, the following services:

1. Verification of source of funds

2. Verification of identity

3. Programme Processing Personnel: The agency must provide enough expert

personnel to help facilitate the processing of applications at rates and terms that

allow Antigua and Barbuda to be efficient and competitive. Initially, the CIU

should be staffed with six persons and then expand based on demand.

4. Promotion of the Programme Overseas: Some agencies will also bring a

network of client sources that will direct business to Antigua and Barbuda. For

example some agencies provide due diligence services to wealth management

firms.

2 www.thehedgefundjournal.com

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DUE DILIGENCE CRITERIA:

1. Financial stability: The Company should be on a sound financial footing.

Financially weak companies are vulnerable to influence and unable to invest

resources in thorough investigations. Publicly listed companies offer more

information on financial condition and find it easier to raise capital.

2. Track record: The number of years of operation, industry awards for excellence,

reference from clients can all point to the operational capability of the company.

The agency should have a track record of providing due diligence services for

countries or wealth management institutions.

3. Certification: Given the nature of their work, some companies are certified by

security agencies such as the US Homeland Security. This provides some

assurance of quality and signals that the host countries are comfortable with their

expertise.

4. Cost: If the cost of due diligence is too high some applicants may be disinclined

to apply. Due diligence fees are usually non-refundable.

INTERVIEW PANEL

The CIU reserves the right to interview any applicant and will use a risk-based approach

to make its decision.

POTENTIAL PROVIDERS OF DUE DILIGENCE SERVICE:

The research of the committee has unearthed several potential sources of due diligence

services:

• Kroll, Ernst and Young (headquarters in New York) and Bishops Services

Incorporated, IPSA International and Risk Advisory Group:

• Kroll provides due diligence and investigation services to countries such as

United States, Austria and St. Kitts. Over the last 40 years, the company has

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developed a network of clients (including four of the top five global banks, 350 of

the Fortune 500 as well as 238 of the 250 largest global law firms) with

sophisticated due diligence and investigative research that has been conducted

in nearly every country in the world. Today, the company has offices in 59 cities in

29 countries worldwide and is comprised of more than 2,800 professionals with

backgrounds including former prosecutors, attorneys, professional investigators,

forensic accountants, intelligence analysts, electronic evidence specialists and

security and law enforcement experts. It claims to have hundreds of trained,

sophisticated researchers who creatively and analytically assemble intelligence for

Kroll’s clients based on the full spectrum of public information, proprietary

databases and local source insight.

Kroll’s performs nearly 15,000 checks a year for investment banks interested in

verifying the legal source of funds for foreign investors.

• Ernst and Young has a global network of partner firms which span the globe.

The company assists major private banks such as UBS with due diligence.

Through its global reach of partners, the company can access traditional and

non-traditional sources of information. The head of its unit was head of the

Association of Certified Anti-Money-Laundering Specials (ACAMS).

• Bishops Services Inc. is the oldest privately held investigation and corporate due

diligence firm in the USA and has provided due diligence services to the CI

programme in Dominica. Bishop's clients include law and accounting firms,

Governments, hedge funds, private equity firms, commercial and investment

banks, recruiting and search practices, real estate firms and corporations

considering mergers, acquisitions and strategic investments. Bishops maintains

offices in New York, Los Angeles and in Mumbai, India with associated offices in

London, Sao Paulo, Hong Kong, Singapore, Moscow, and Beijing and in more

than 200 countries around the world.

• Risk Advisory Group is a global risk management consultancy. They are

committed to guiding clients through an increasingly complex international

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regulatory, compliance and security environment. Their clients include many of

the world’s leading corporate entities, financial institutions, and law firms, most of

which operate globally including in the most challenging jurisdictions. Their

clients demand extensive international reach. Since their launch in 1997 they have

conducted assignments in more than 100 jurisdictions across six continents.

With an uncompromising attitude to compliance with the law and the application

of the highest ethical standards, their multi-disciplinary teams deliver a unique

blend of professional expertise and effective, client-focused solutions. Their

professional staff is drawn from a wide range of disciplines, including the law,

accountancy, banking, the armed forces, the police, the intelligence services,

public relations, journalism, academia and specialist research. Their teams are

also from a diverse range of nationalities, bringing with them a profound

understanding of different countries and regions of the world as well as the

highest ability in many languages.

• IPSA International, Inc. assists clients in mitigating risks throughout the world.

The information and analysis they provide is utilized to increase and protect our

clients’ investments and assets by offering improved transparency to the choices

they make or uncovering wrongdoings in their organization. They accomplish this

by providing timely, accurate and actionable intelligence.

They employ seasoned professionals specializing in conducting high-end

investigations with expertise in services ranging from complex financial crime and

intellectual property issues to conducting anti-bribery investigations or due

diligence on a potential partner or customer.

In 1993, IPSA International, Inc., was established as the investigative and

consulting division of a large contract security company, American Protective

Services (APS). IPSA’s start included two small offices in San Francisco and Los

Angeles. In 2000, IPSA became IPSA International, Inc., a stand-alone entity. In

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2005, IPSA was acquired by a group of its senior management team, lead by

President and CEO Dan Wachtler.

Today, IPSA has offices in the U.S., Canada and U.K., resources in over 75

countries worldwide and a talent base that is focused on assisting clients in

making better-informed decisions to protect their investments and assets.

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SPECIAL ADVISOR

The success of this economic development initiative is not only predicated on having

sound due diligence agencies but also establishing sound procedures and guidelines to:

• Draft the Policy Guidance to administer the program;

• Create application forms and the website content;

• Establish rigorous Escrow arrangements for all funds received and disbursed

under the CBI NDF, which includes a vetting process of both the applicants and

their funds prior to investment;

This is a new sphere of economic development for the Government and the nation of

Antiguan and Barbuda. It is also fraught with risk, especially for the inexperienced. As a

result, the Task Force met with several companies to assess their competence in assisting

the Government to establish the programme, develop the requisite competence and to

market the programme on a global scale. Henley and Partners distinguished itself in this

regard.

Henley & Partners - Residency & Citizenship Practice Group Henley & Partners is the

world's leading specialist in residence and citizenship planning for private clients (

www.henleyglobal.com ). Although its origins date back more than 40 years, Henley &

Partners as it is today was formed in 1997 through the combination of a private client

immigration consultancy and a trust company. Headquartered in Jersey (Channel Islands),

its Residence & Citizenship Group has over 50 specialists located around the world,

including Hong Kong, Dubai, Jersey, Malta, Switzerland, Croatia, Belgium, St. Kitts & Nevis

and Canada. The firm also has a thriving Government advisory practice, in which it advises

countries in assignments ranging from strategic consulting to assistance in the design

and implementation of investment-related immigration programs. Key people of the firm

can be viewed here: https://www.henleyglobal.com/about/key-people/residence-

citizenship-group/.

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It is recommended that Henley and Partners provide the following services:

• Present to the Government a concept paper on all aspects of the administrative

and procedural implementation of the intended CIP, including, without limitation,

structure of the CIU, including job descriptions of all staff of the CIU; training by

Henley and Partners of CIU staff; a proposed work flow and implementation

schedule including milestones; and the relationship between Henley and Partners

and the CIU;

• Assist the Government in setting up a Citizenship by Investment Unit, its terms of

reference, its reporting lines to Government and proper internal procedures;

• Support the CIP implementation process of the Government, including, but not

limited to

a. a public information process that offers information about Henley and

Partners and its track record with CIPs,

b. attend other meetings as requested by the Government;

• Present to the Government a concept paper with respect to the launch and

international promotion of the CIP;

• Advise the Government on the licensing requirements of authorized persons,

citizen by investment agents, including qualifications, renewal of licences and

revocation of licences; establishment of an oversight committee and its powers; a

process for granting and revocation of citizenship; and mechanism for appeals.

• Present to the Government its expert opinion on the expected economic and

social benefits as well as the possible adverse aspects of the CIP, and to assist the

Government in mitigating the possible adverse aspects;

• Cooperate with the Government regarding possible modifications of the concept

papers created by Henley and Partners required by the Government.

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ECONOMIC IMPACT

The CIP is not a panacea to cure all the economic and social challenges in Antigua and

Barbuda but it can be an effective tool to mobilize resources for economic and social

development. At the end of its third year of existence, the initiative is expected to result in

gross inflows of over US$205.2 million (EC$550 million). At its zenith, it is projected to

produce US$228.2 (EC$615 million) annually.

These sums are quite significant but with the multiplier effect and the important real

estate component, it will produce significantly more economic activity along the

construction value chain such as hardware store purchases, legal fees, construction

services, payment to statutory corporations and property tax.

The present physical component of the programme will provide a boost to the tourism

industry as the individuals will utilize services such as accommodations, dining and

transportation. The programme provides an incentive for persons to satisfy their physical

presence requirement in the summer when there is a marked decline in visitor arrivals.

The financial projections in the short to medium term for the CIP are provided below:

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Table 2: Projection 1: First 3 Years

All Figures are in US

Months from launch 12 24 36 Grand TotalYearly Total of Applications

70 150 230 450

Yearly Total collected under NDF

7,000,000 15,000,000 23,000,000 $45,000,000

Yearly Total collected under Charitable Option

4,200,000 9,000,000 13,800,000 $27,000,000

Yearly total Real Estate 5,600,000 12,000,000 18,400,000 $36,000,000

Yearly processingFees 12,250,000 26,250,000 40,250,000 $78,750,000

Yearly Due Diligence Fees

1,470,000 3,150,000 4,830,000 $9,450,000

Yearly Fees to Authorized agents

1,400,000 3,000,000 4,600,000 $9,000,000

Grand Total: $205,200,000

Key: NDF is the National Development Fund.

After the initial three year, it is expected that the CIP will progress along the following

path annually:

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Table 3: Annual Receipts After Year 3

Yearly Totals 500Total funds raised under National Dev Fund option

Yearly Totals 50,000,000Total funds raised under Charitable Fund Option

Yearly Totals 30,000,000Total funds raised under Real Estate option

Yearly Totals 40,000,000Total Processing fees

Yearly Totals 87,500,000Total Due diligence fees

Yearly Totals 10,500,000Total Distribution fees to Service Providers

Yearly Totals 10,000,000228,000,000

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All Funds are in US Dollars

It is expected that the CIU will bring resources to the island based on the following

proportion seen in Chart 1:

National Development

Trust22%

Charitable Contribution

13%Real Estate Investment

18%

Application Fees38%

Due Diligence5%

Distribution to Agents

4%Chart 1:CIP Receipt Allocation

REAL ESTATE OPTION

The economy of Antigua and Barbuda has benefited greatly from the buoyancy of the

construction sector. This impact was contributed to in part by the expansion of the

tourism sector, particularly residential tourism. The commencement of the Citizenship by

Investment Programme will allow for the re-energizing of this vital sector as a core

component is the construction and or purchase of residences valued at a minimum of

US$400,000.00. The country has a stock of inactive units as well as incomplete projects

which an initiative such as this could make viable in the short to medium term. With

respect to the incomplete or stalled projects, the impact on the construction sector and

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employment will be significant. 3

It is estimated, that there are thirty-four (34) units

completed and readily available for sale under the residential option. Another thirty-one

(31) are under construction. The estimated inventory of residential tourism lots is 1,176,

with a value of US$1.28 billion. This underscores the potential benefit of a Citizenship by

Investment Programme, which will make the destination even more attractive.

The Taskforce anticipates that 20% of the applicants will choose the property option

resulting in direct investment of US$40 million (EC$108 million) annually.4

Additionally,

income will be generated through the payment of fees, licenses, service providers in the

initial stages, as well as the multiplier effect of spending from the recurring residential

tourism traffic created by the programme. Additional fees to be generated by this

investment option include property and transfer taxes.

The Escrow agents for the property option must be internationally recognized firms that

serve the mutual interest of the parties to the transaction. In order to bring order to this

arrangement the Task Force will provide Guidelines to govern this important relationship

since it has strong reputational implications for the jurisdiction.

BUSINESS OPTION

This component of the Citizenship by Investment Programme provides a direct economic

impact by way of its contribution to productive and trading activity and the attendant

employment and sub-contracting spin-offs. Beneficiaries of the CIP through the business

option would be expected to generate long term employment, differentiate their

enterprises through the introduction of new technology or technology transfer, value

added services or production activities leading to (near) export ready products or services

to enhance foreign currency earnings and consolidate the country’s comparative

3 Antigua and Barbuda Real Estate Association, “Antigua and Barbuda Development Analysis”, November 2011 4 Based on the construction or purchase of 15 properties.

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advantage. This option may also be used to fund public-private partnerships as well.

Additional benefits to accrue to the public purse include payroll, ABST and corporate

taxes.

NATIONAL DEVELOPMENT FUND (NDF)

The National Development Fund (NDF) route to citizenship by investment is a strategic

capital mobilization measure aimed at leveraging wealth primarily to fund income

generating public sector projects and innovation in entrepreneurship. An increasingly

conservative lending environment coupled with constrained Government resources have

exacerbated the inability of small and micro enterprises, in particular, to access finance

both for new projects and expansion. The degree of the country’s exposure to external

factors and their impact on the domestic economic climate compels a diversification of

the productive economic base which is generally driven by dynamic small enterprises.

These businesses are often able to recognize and respond to supply gaps in the market

and apply demand analysis to develop appropriate products and or services.

The NDF option has the potential to drive job creation and economic growth, by helping

entrepreneurs turn innovative ideas into products and services that change the way we

live and work. As such, it is recommended that the NDF focus primarily on enterprises

developing significant innovations through the provision of long-term, committed share

capital, to help these businesses grow and succeed. Funding should however not be

limited to new enterprises. If an entrepreneur plans to expand, buy-into a business, buy-

out a business in which he works, turn around or revitalize a company, consideration

should be given to these efforts. As a guiding principle, these businesses should be

aiming to grow rapidly to a significant size offering the prospect of significant turnover

growth within five years. Funds from the NDF can be channeled through agencies such

as the Antigua and Barbuda Development Bank, the Credit Unions and National

Development Foundation for on-lending or to support Government’s contributions to

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projects such as the redevelopment of Half Moon Bay and the upgrading of Heritage

Quay.

Apart from providing a new financing option for businesses, the NDF also adjusts the

culture of management and ownership, allowing entrepreneurs to experience the benefit

of wider expertise with the NDF providing high quality management expertise.

Additionally, public private partnership projects with economically viable components

would be able to apply for financing support from the NDF.

The NDF’s management and operations must be transparent. With an anticipated 22% of

the approvals using this option, capital mobilization through this medium is estimated at

US$50,000,000.00 annually when it reaches the maximum.

It is critical that the NDF is structured correctly to ensure it achieves it purpose. It is

therefore recommended that the NDF:

1. Be its own organization, separate from the government

2. Be managed by an independent Board of Directors composed of highly

respected individuals

3. Have a well-defined Mission Statement and clearly defined investment

parameters

4. Have a Board that will manage its affairs professionally and regularly meet to set

policies and priorities for its investment activities

5. Publishes its accounts and be audited by an international accounting firm

CHARITABLE FUND

The research suggests that there are individuals who would wish to use what may be

considered the least complicated medium for making a contribution to the development

of the country but with the caveat that specific projects benefit.

The Task Force has identified the areas of health care, education, sports, youth

development and environmental management as priority areas to be funded through this

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option. Contributions can only be made to approved and regulated non-profit

organizations which deliver services in the identified areas. This option differentiates

Antigua and Barbuda’s Citizenship by Investment Programme from all similar initiatives

and positions the product as a wholistic investment mechanism.

A DESIRABLE OUTCOME-PHILANTHROPY

As a related benefit, we intend to encourage the network of new citizens to be

philanthropic in the application of capital, business strategies, skills, and resources to

charities and socially conscious projects. The objective would be to focus on leadership,

bold ideas, developing strong teams, active board involvement, and long-term

investment. We anticipate significant impact in the areas of poverty prevention and

alleviation, education, corporate responsibility and community relations, sustainable

energy and technology. Social agencies such as the Sunshine Home for Girls, Amazing

Grace Foundation and similar programmes, would be transformed by the human and

capital investment, management assistance and knowledge transfer available through

such philanthropy. Revised or new job placement and poverty alleviation programmes

could be supported in this manner.

Additionally, where CIP citizens have highly specialized skills in medicine, education,

environmental management, business management, psychology and behavior

management, and green technology, the Task Force recommends that they be offered

the opportunity to apply and or transfer those skills in relevant institutions and agencies.

As an incentive, they can be given credit for the number of days spent in these activities

towards the minimum residency requirement, thus reducing the number of calendar days

they are compelled to stay in the country. As an example, should a behavioural

psychologist spend 5 days working in the public school system with school counselors

and at-risk children, this could be computed as 7.5 days of physical presence.

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INSTITUTIONAL SETTING

Citizenship by Investment programmes are treated as a pivotal strategic business

development matter. Citizenship by Investment is treated as a driver of economic

development by all of the countries reviewed by the Task Force. In some cases, it is

concerned with purchasing of real estate, in others investing in sovereign financial

instruments and starting/purchasing a business to generate employment. All of these are

business development issues.

Currently, the ABIA and the Marine Department fall under the Prime Minister’s portfolio.

In many countries, the Investment Promotion Agency also falls under the Prime Minister.

The Task Force therefore recommends that the Citizenship by Investment Unit be placed

under the Prime Minister’s portfolio.

The hosting of CIU under the portfolio of the Prime Minister will also send a powerful

signal to developers, potential clients, service providers and other nations, as it speaks to

the level of importance attached to CIU.

The issue of CIP will no doubt attract strong and spirited public discussion. The Task Force

will hold public consultations given its strong emphasis on transparency. This initiative

will be one of the major policy decisions of this administration and the Prime Minister can

play a key role in piloting its approval.

This Unit can be a stand alone, located in the Prime Minister’s Office or as a Department

of the Antigua and Barbuda Investment Authority. The latter brings the commercial and

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retail business processes of investing in real estate, under one roof. 5

“IPAs usually fall

under and are included in the responsibilities of the ministries of economic affairs, finance

or foreign affairs. These ministries allocate the agencies’ budgets. Heads of IPAs

consequently report to the respective ministry and budgetary changes are at the

ministry’s discretion. In some cases, IPAs are placed under the President or the Prime

Minister's Office.”

The decision to grant citizenship by investment will rest with a dedicated core of

professionals employed by the CIP Unit.

The interview team should possess the required mix of competences such as due

diligence, audit, business development, legal matters, international relations and security.

All employees of CIU should sign a special oath of secrecy to ensure confidentiality. Some

of the functions of the CIU include:

• Evaluating all applications for citizenship

• Appointing all Authorized Agents and Licensing Citizen by Investment Agents

• Interviewing applicants as required

• Receiving and distributing all funds collected under the CIP

• Selecting all Due Diligence service providers

• Referring applications to Due Diligence Service providers for their review

• Interfacing with other service providers in the citizenship by investment process

e.g. passport office or other relevant government departments and entities

• Reporting to the Management Oversight Committee

• Promoting the CIP internationally

Oversight Committees

The Task Force realizes the important role that the CIU will play in this national

development effort and the need to ensure that it is closely guarded to safeguard its

5 “The World of Investment Promotion Agencies at a Glance”, ASIT Advisory Studies No.17, UNCTAD 2001

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reputation and that of the country. It is therefore recommended that two Oversight

Committees be established to oversee its operations.

Management Oversight Committee

This committee will oversee two main areas:

• The daily operations of the CIU

• The CIU relationships with outside contractors, especially those which provide

Due Diligence services

This committee will perform an important role in gathering information on the

functioning of individual departments and ensuring, through its oversight and

questioning of management officials, that corrupt practices do not take place. It should

also ensure that the CIU delivers high quality service to its clients and maintains its

competitive advantage by simplification of administrative procedures where necessary.

Parliamentary Oversight Committee

The Task Force recommends that a permanent bi-partisan five-member senior

parliamentary committee provides oversight of the CIU. The recommended members are:

the Hon. Prime Minister, The Leader of the Opposition, the Hon. Attorney General and

one other member drawn from each political party. The Prime Minister should report to

this august body twice per year.

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Notification of Approval/Refusal to CIP Agent

PROCESS FLOW

Application Submitted to CIU by CIP Agent

Application forwarded by CIU to International Due Diligence Service Provider

International Due diligence Service provider

forwards report to CIU

CIU makes decision re granting of citizenship

f

Notification of Approval to Honourable Prime Minister

Swearing of Oath of Allegiance and Issuance of Passport by Passport Office

No

Payment of Fees to CIU

No

Yes

Yes

Payment of funds into Escrow Agent

Interview of Applicants by CIU

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It is intended that an application for citizenship by investment will be processed and a

decision communicated to the applicant and his/her agent within 90 days.

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CITIZENSHIP BY INVESTMENT AGENTS

Applications to the CIU should be made through citizenship by investment agents. These

agents should be selected based on their international business experience and network,

marketing acumen and corporate ethics. Agents have been traditionally drawn from the

disciplines of law, accounting and international business services. However, where

selected agents are not themselves accountants or lawyers, the practice has been to

require them to use the services of an accounting or law firm.

It should therefore be the policy of the Government that all persons desirous of obtaining

citizenship by means of investment shall make their applications through licensed CIP

Agents. This will serve to protect the applicants as well as the integrity of the programme

and the country’s national passport. Licenses issued by the CIU should be understood to

be revocable for cause and as outlined in all documentation covering the issuance of the

licenses.

The Task Force has engaged a service provider to provide detail guidelines to regulate

the behavior of citizenship by investment agents.

At the onset, it is proposed that the citizen by investment agents be paid US$20,000 per

successful application. This rate can be changed from time to time by the Minister on the

recommendation of the CIU.

Criteria for Granting of C.I.P License

Applicants for the C.I.P. Agent license must:

• Be fully conversant with the requirements, criteria, guidelines, laws pertaining to

the Citizenship by Investment Programme;

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• Have the capacity to contact, attract and influence foreign investors;

• Have the machinery to assist prospective investors to comply with the

requirements of the CIP Secretariat.

• Have no criminal record for offenses involving dishonesty and in the case of a

company, have no shareholders or directors with a criminal record for an offense

involving dishonesty;

• Not have declared bankruptcy or adjudged bankrupt;

• In the case of a company provide the CIU with a current list of its directors,

officers and shareholders, indicating their nationality and along with a certificate

of good standing issued by the Registrar of Companies;

• Have the machinery to keep proper records and to maintain documents in

safekeeping;

• Indemnify Government against exposure based on their involvement in the

programme. Each Agent must obtain professional indemnity insurance to an

established limit set by the CIU.

The Procedure for Obtaining a Licence

• Applications for a CIP Agent license should be made to the CIU and should be

accompanied by the requisite forms and documentation required by the CIU.

Some of the documentation required include:

o Notarized copy of license certificate

o Certificate of good standing or Practising Certificate from its professional

body

• All applicants must be a local Antiguan business registered in Antigua/Barbuda.

• The application will be reviewed by a select oversight committee based on the

eligibility requirements as stipulated above and a recommendation sent to the

CIU for approval.

• Applications should be accompanied by a non-refundable processing fee of

US$1,000.00.

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• CIU will inform applicant within 30 days of the receipt of the application whether

the same has been approved or denied.

• Where an application has been approved, the CIP Agent shall pay an annual fee

of US$3,000.00.

• CIU will publish a list of CIP agents/consultants.

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CONCLUSION

Like the rest of the world, Antigua and Barbuda is facing hostile fiscal challenges with

over-burdening debt and declining financial resources to finance its development

agenda. Bilateral aid and multilateral loans are delivered with golden handcuffs including

specifying contractors, source of supply and policies which expose the most vulnerable in

our society. The CIP should not be seen as a cure all and an excuse for financial

irresponsibility but an opportunity to build national consensus on a path to development

that reduces the national debt, builds adequate infrastructure, educates the population,

encourages entrepreneurship and diversifies the economy while safeguarding the

integrity of the Antigua and Barbuda passport.

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SUMMARY OF RECOMMENDATIONS

a. FEATURES OF CITIZENSHIP BY INVESTMENT:

• Citizenship, which confers the right to a passport being valid for a period

of 5 years with application for renewal thereafter.

• Citizenship under this initiative comes with a residency requirement of at

least fifteen days per year over a five year period. Citizens may opt to

complete their residency requirement in any one year of the five year

period.

• Purchase of a previously held property in a designated zone would not

confer automatic eligibility for citizenship.

• The right to vote is not automatically conferred through the CIP. The

provisions of the Representation of the People’s Act will apply.

• The CIU reserves the right to interview any applicant.

b. ELIGIBILITY REQUIREMENTS:

• Applicants may have to present themselves for an interview on

completion of the due diligence process and receipt of a favorable

report. 6

• A certificate of good health must be presented by the applicant.

The Citizenship by Investment Unit (CIU) reserves the right to

interview every applicant. Every successful applicant must appear in

person in Antigua and Barbuda at the CIU to collect his/her passport and

to take the Oath of Allegiance.

• Individuals convicted of the crimes listed hereafter would not be eligible

for consideration:-crimes against humanity, drug trafficking and related

offenses, sexual offenses, capital offenses, money laundering, terrorism

and its financing, human trafficking, migrant smuggling and piracy, or

6 A risk-based approach can be used to determine the need for an interview.

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any immigration offence that led to a denial of visa, refusal of admission

at port of entry, or deportation.

• There would be no automatic disqualification of specific jurisdictions,

however in the national interest the Government could impose

restrictions if necessary and these restrictions should form the basis of

the policy guidelines established prior to the launching of the CIP.

• Applicants must deposit 100% of the contract sum after due diligence is

completed.

• There will be a physical presence requirement of a minimum 15 days

annually or 75 days over a 5 year period. Where on application for

renewal of a passport it is determined that the CIP citizen has not fulfilled

the physical presence requirement, they would be required to comply

prior to renewal.

• Applicants may be 18 years or older.

• Dual (multiple) citizenship is allowed.

c. INVESTMENT QUALIFICATIONS FOR CITIZENSHIP:

• Applicants for citizenship must acquire property of at least

US$400,000.00

• Contributions to the NDF and CF would be US$200,000 minimum (for a

single applicant

• Business investment for citizenship would start at US$1.5M

• Multiple applicants may invest in a business not less than US$4 million

each person contributing not less US$400,000.00 each

d. REVOCATION:

Antigua and Barbuda retains the right to withdraw citizenship obtained under the

CIP if a citizen by investment fails to retain ownership of the real estate that

prequalified him for citizenship, commits a crime on the territory of Antigua and

Barbuda or elsewhere, has become a threat to national security and/or it has

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become evident that he/she had made one or more material false statements in the

course of application.

e. FEES

There are three types of fees payable under the programme: Due Diligence,

Processing and Commission. Due Diligence fees are the direct cost of assessing the

worthiness of applicants. In addition to making an investment, the principal

applicant and family members pay a Processing fee per person. The Commission is

the amount paid by the applicant to Citizen by Investment Agents whose clients

meet successfully apply and are granted citizenship.

f. SPECIAL AREAS: RESORT DISTRICTS

The Task Force strongly recommends that only designated zones be considered

eligible under the real estate component of the CIP. The developments in the zones

recommended by the Task Force can be found in Appendix 1.

g. DUE DILIGENCE:

• Outsourcing: The Task Force recommends that this function be

outsourced to experienced international firms which currently provide

the services to other jurisdictions that provide citizenship by investment.

Additionally, the service providers must be those used to provide due

diligence services to first world Governments and major financial

institutions.

• Potential candidates: The Task Force interviewed and entertained

presentations from Kroll, Ernst and Young (New York), IPSA International

and Risk Advisory Group and recommends them as potential service

providers.

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h. INSTITUTIONAL SETTING:

Citizenship by Investment programmes are treated as a pivotal strategic business

development matter. The Task Force recommends that the Citizenship by Investment

Unit be placed under the Prime Minister’s portfolio. This Unit must have a separate

location from the Prime Minister’s Office.

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ANNEX 1 : Proposed Projects for Citizenship-by-Investment Programme

Harbour Island

Jolly Beach

Pelican Island

Crump Island

Crump Peninsula

Guiana Island

Carlisle Bay

Morris Bay

South Point

Galley Bay Heights

Jolly Harbour

Pearns Point

Galleon Beach

Rendezvous Bay

Windward Bay

St. James

Willoughby Bay

Half Moon Bay

Emerald Cove

Non Such Bay

Jumby Bay

Weatherills

Hodges Bay Club

Waterfront Properties

Antigua Village

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Azure Bay

Tamarind Hills

Sugar Ridge

Queen’s Bay Resort

Orange Valley

Blue Waters

Valley Church Development

Ffryes Estate Development