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A careful approach

Ms. Lucilla Lewis of Dominica’s International Business Unit (IBU) reports that by December 1998, 173 investors had successfully applied for economic citizenship in Dominica through the Program and a total of 341 passports have been issued, showing the popularity of Dominica’s special fee structure for families; a one-time payment to the Government of US$50,000 qualifies the investor, his or her spouse and their two children (under 18 years old) for economic citizenship.  Another option is purchasing US$75,000 in 15-year bonds and paying additional application fees.

Mr. Lennox Lawrence of Caribbean Investments Ltd. in Dominica is not surprised by the Program’s success.  In his opinion, the Program is one of the best in the region.  He points immediately to three advantages that set it apart: the low cost to the investor, the absence of any residency requirement, and the family fee structure.

One might think that the family fee structure is simply a perk, a “buy-one-get-three-free” offer.  This is not at all how Mr. Lawrence or his clients see it, however.  Mr. Lawrence meets a diverse group of applicants who are, of course, interested in the fiscal benefits Dominica offers, but are often simply looking for a new experience.  Fed up with government policy in their home countries, or interested in different investment possibilities, Dominica’s new economic citizens can get a fresh start.  Obtaining citizenship in Dominica is part of a lifestyle change, and family is usually a priority when contemplating such a change.  Interestingly, Mr. Lawrence noted that perhaps half of the applicants he deals with are North American.

With their families, economic citizens who choose to migrate bring to Dominica their professional experience and their resources; personal, as well as financial.  In addition to an international screening of the applicants for criminal records (Dominica’s IBU notes that the existence of a criminal record is the most common reason for rejecting an application), each applicant must provide evidence of a successful business background or technical expertise.  This is not a rigid criterion - a professor or a banker could both have the requisite background - rather, it is an attempt to ensure the quality of accepted applicants.  An applicant who has been successful in business or academia will likely continue to make a positive contribution to the community in Dominica. 

Seeking improvement

The Program is under continuous review by the Government of Dominica.  Mr. Lawrence commented that one possible change might be the introduction of a quota system, restricting the number of new economic citizens admitted in a particular year.  The guiding concern of any review would appear to be ensuring that the quality of new citizens remains high, that they contribute to and do not harm the community.  Mr. Lawrence mused that a residency requirement might be an additional safeguard for the Island.  This would allow a longer time period in which to investigate the applicant before granting a less easily revocable citizenship.

The Dominica IBU is also looking at ways to improve the program.  One change currently being contemplated would be the imposition of a registration fee on agents.  Currently, the application procedure for agents is relatively simple and straight-forward.  Prospective agents submit an application form with supporting documentation and a personal data form.  They must also undergo an international check for criminal records.  The Government also attempts to ensure that prospective agents possess the required skills and are able to assist applicants under the Program.

Understandably, being able to offer agency services to clients interested in economic citizenship is popular.  It is thought that a registration fee might help to emphasise, as Ms. Lewis of the IBU puts it, that the government will not accept “just anyone” as an agent.

Not a back door route

For the most part, new economic citizens of Dominica enjoy the same privileges as natural citizens.  They must be residents for five years before they are allowed to vote, however, and there are certain restrictions on their right to purchase property above a specified minimum amount.

One definite advantage of citizenship for some applicants is the possibility of visa-free travel to all of the Commonwealth countries.  The issue of visa-free travel seems to go to the heart of what one could call Dominica’s “economic citizenship philosophy”: new citizens are welcomed, and their contributions to the country are valued and encouraged, but this is not a refuge for criminals.  On the topic of the U.S. visa requirement, Mr. Lawrence said firmly that “this product is not designed to circumvent U.S. rules”.  If someone was not allowed into the U.S. because of their citizenship and has now established a meaningful connection to Dominica, Mr. Lawrence foresees no problem in obtaining a visa.  If they have not established such a connection, however, Mr. Lawrence quite understands the refusal;  “Dominica is not a back door”, he points out.

Conclusion

Dominica has already embraced the philosophy of sustainable development as its promotion of “eco-tourism” demonstrates.  Economic growth at any cost is not worthwhile and investment without considering its long-term consequences can do more harm than good.  Dominica’s Economic Citizenship Program is seen by the Government as one aspect of a long-term strategy for economic growth.  The Program is being watched carefully and will be under constant review if necessary to keep out an undesirable criminal element.  It seems that the gates to this paradise can be opened, but they remain well-guarded.
 

Christopher E.J. Main is a reporter and staff researcher for Offshore Finance Canada magazine. [Copyright 1999 O.F.C. Publications Inc.  This article was published in the July/August 1999 issue of Offshore Finance Canada magazine]