In a significant development for the European Union, Bulgaria and Romania, members since 2007, are preparing to partially join the Schengen Area from March 31, 2024. This move will enable Bulgarian and Romanian citizens and residents to enter the Schengen Zone via sea and land routes without facing border checks, although land travel will still involve border scrutiny.
This change is particularly relevant for global investors, as both countries offer Residency by Investment (RBI) programs. These programs provide a pathway to residency in the EU through investment. The Bulgarian program demands a minimum investment of €512,000, whereas the Romanian one requires €1 million.
The inclusion of Bulgaria and Romania in the Schengen Area is expected to boost the popularity of their RBI programs. Alexander Dobrinov, a managing partner at a Bulgaria-based firm, reports a significant increase in inquiries about obtaining Bulgarian residency following the Schengen Area announcement.
However, there are potential challenges. The European Union has been enforcing stringent regulations on golden visa and RBI programs across Europe, which might impact these programs. Dobrinov notes that while the EU may seek to limit these options, the variety of residency permits available in Bulgaria – long-term, prolonged-term, and permanent – are likely to retain their value post-Schengen accession.
Both Bulgaria and Romania offer attractive benefits to RBI investors, such as a low cost of living and favorable tax rates. Bulgaria, for instance, has a flat 10% tax rate, an aspect that appeals to many foreign investors.
Pros:
This change is particularly relevant for global investors, as both countries offer Residency by Investment (RBI) programs. These programs provide a pathway to residency in the EU through investment. The Bulgarian program demands a minimum investment of €512,000, whereas the Romanian one requires €1 million.
The inclusion of Bulgaria and Romania in the Schengen Area is expected to boost the popularity of their RBI programs. Alexander Dobrinov, a managing partner at a Bulgaria-based firm, reports a significant increase in inquiries about obtaining Bulgarian residency following the Schengen Area announcement.
However, there are potential challenges. The European Union has been enforcing stringent regulations on golden visa and RBI programs across Europe, which might impact these programs. Dobrinov notes that while the EU may seek to limit these options, the variety of residency permits available in Bulgaria – long-term, prolonged-term, and permanent – are likely to retain their value post-Schengen accession.
Both Bulgaria and Romania offer attractive benefits to RBI investors, such as a low cost of living and favorable tax rates. Bulgaria, for instance, has a flat 10% tax rate, an aspect that appeals to many foreign investors.
Pros:
- Increased Mobility: Bulgarian and Romanian nationals will have easier access to the Schengen Area, enhancing travel convenience.
- Investment Opportunities: The RBI programs of both countries offer new investment avenues for global investors.
- Economic Boost: The anticipated rise in popularity of RBI programs could stimulate the economies of Bulgaria and Romania.
- Tax Benefits: Low tax rates in these countries are attractive to foreign investors.
- EU Scrutiny: The EU's strict regulations on RBI programs may pose challenges to the Bulgarian and Romanian programs.
- Limited Land Travel Freedom: Despite partial Schengen Area membership, land travel will still be subject to border checks.
- Investment Risk: The dynamic nature of EU policies could introduce uncertainties for investors in these RBI programs.