Baltic States – CIS, Latvia

The Security Police continued vetting the foreigners applying for temporary residence permits in exchange for investments also in 2016. Of the 1,864 temporary residence permits issued in return for investments last year, 673 were issued for the first time and 1,191 were issued repeatedly for a five-year period.

The dynamic of resident permit applications was therefore influenced by those foreigners who applied for extensions of their residence permits, while demand for new residence permits continued to decline.

Most foreigners applied for temporary residence permits in exchange for investments in real estate, although only 514 of the 1,597 residence permit requests in this category were for new residence permits. Also, 115 temporary residence permits were requested in return for investments in company capital (85 requests for new permits), 112 temporary residence permits were requested in return for investments in banks' subordinated capital (37 requests for new permits), and 38 permits were requested in exchange for investments in government securities (37 requests for new permits).

According to the Security Police, foreigners' investing activity in Latvia was mostly influenced by Russia's changeable economic situation and legislative regulations. Notwithstanding economic volatility, citizens of Russia still remained the most active applicants for Latvian residence permits in exchange for investments, making up 72% (1,340 persons) of the total number of applicants. Citizens of Ukraine made up the second largest group of applicants, followed by citizens of Kazakhstan, China, Uzbekistan and other countries.

Upon assessing the applications for Latvian residence permits, the Security Police decided to decline 30 foreigners' requests. Last year, the Security Police also continued to repeatedly vet those holders of residence permits who are required to register with the Latvian authorities each year and decided to revoke 11 persons' residence permits.

The denials and revocations of temporary residence permits were based on the negative information obtained by the Security Police and risks associated with national security interests. "Counterintelligence risks were found In 46% of cases, which means that the applicants seeking residence permits were or could be involved in foreign intelligence services' activities targeting Latvia's interests," the Security Police said in the report.

Economic risks were found in 22% of cases, for instance, the law enforcement authorities had suspicions that the applicants could be involved in money laundering or faced criminal action in their countries of origin for large-scale fraud. Other threats to national security were found in 32% of cases, including risks to Latvia's constitutional system that might stem, for instance, from a person's involvement with Russia's compatriot policy.