Vanuatu citizenship: why it might be the smartest move this year

— Vanuatu is an island nation in the South Pacific, east of Australia. It is one of the best resort areas in Melanesia.

Due to the remoteness of the islands, their pristine nature has so far been preserved. Perhaps this will no longer be the case after another decade or two. This is one of Vanuatu’s priceless treasures.

People come to the country to plunge into an unusual culture, go diving and sea fishing and see coral reefs.

There are relatively few tourists, even from the East or Australia, which is an advantage for those who want to have a quiet break and relax away from the crowds. At the same time, Vanuatu’s infrastructure is quite well developed and it is part of the British Commonwealth.

— Many people know about the benefits of Caribbean citizenship as it is now well known. However, when investors find out that Vanuatu citizenship offers similar opportunities and at the same time is issued faster and is cheaper, they select it. Especially when their time and budget are limited.

Some applicants are put off by the geographical remoteness of Vanuatu. However, in fact, holders of a Caribbean passport rarely have to travel there.

A Vanuatu passport, like those of the Caribbean countries, is used as a means of traveling around the world visa-free rather than for immigration. At the same time, everyone has their own goals: to travel without visas, legally reduce their tax obligations or register companies in a country where tax rates are low.

To find out what are the differences between these programs, I advise you to read our article “9 Reasons to get a second passport”.

A Vanuatu passport is more often used to travel around the world rather than to immigrate. As a result, it doesn’t matter how remote the country is. The administration of the oath of allegiance and the issuance of a Vanuatu passport can take place remotely.

— Recently we were approached by a political refugee, Narong, from Thailand, who was temporarily staying in Germany. With his passport, he could not travel outside the European Union as he would have been deported to his homeland. Therefore,he wanted to get a second passport and chose Vanuatu.

With his second passport, Narong stayed in the UK for four months and then returned to Germany. In Vanuatu, he registered a company and took advantage of the preferential tax rate applied to Vanuatu citizens. We wrote about this case in our article “Vanuatu citizenship for freedom of movement around the world and business registration”.

In 2020, the family of an Italian count received Vanuatu citizenship. Vittorio is an entrepreneur from Naples, the owner of a business that produces and supplies fabrics. He often came to St Petersburg to meet his business partners.

Vittorio had to apply for a visa to visit Russia: previously he had to endure the tiring and drawn out procedure of submitting his documents at the consulate in Rome, wait and then return to collect his passport and visa. He grew tired of this endless bureaucratic process and decided to apply for a Vanuatu passport instead. We discussed this case in our article “Vanuatu citizenship for an Italian count”.

— Getting a Vanuatu passport is the easiest and fastest way to get a second citizenship. No other citizenship program in the world offers better conditions.

Vanuatu citizenship is issued within 2—4 months in return for investment in the country's economy. The minimum investment for one applicant is $130,000.

First, a fee of $5,500 is paid for an initial Due Diligence check. The investor needs to submit their passport, a certificate of no criminal record and a resume in English. Any family members included in the application for Vanuatu citizenship by investment together with the investor must also undergo a Due Diligence check.

After the initial Due Diligence check, the investor pays 25% of the agreed investment amount, and then their application is submitted to the Vanuatu government committee dealing with citizenship by investment.

— As soon as the investor passes the Due Diligence check, it is time to take the oath. Before the pandemic, the law required the applicant and their family members included in the application to visit Vanuatu or Hong Kong for this or pay for the expenses of an honorary consul to travel to a location convenient for them.

Due to the difficulty of traveling during the pandemic, the citizenship department decided to help investors and has allowed them to take the oath remotely online.

— The conditions of the program are quite supportive of family members and allow the following members to be included in the same application as the investor:

• the main applicant’s spouse;

• their children under 18;

• their children 18 to 25 years old who are financially dependent on the investor and are not married;

• parents of the main applicant and their spouse over 50 years of age.

A child born after the investor obtains citizenship can also become a Vanuatu citizen for $20,000.

— The Vanuatu program offers only one investment option: a non-refundable contribution to the National Development Fund. The government invests the money received from the program in the economy. Perhaps in a couple of years there will be an option to invest in real estate.

— With Vanuatu citizenship, you can register an international company and open a bank account at a European bank. It might help you avoid possible currency control restrictions in your country of origin when settling transactions with your foreign partners. Foreign currency payments from accounts in a European bank are transferred faster and with lower fees, if any.

As I said, most often a Vanuatu passport is selected for traveling around the world without visas. Vanuatu citizens can visit 107 countries visa-free. Free entry to the EU and Schengen countries is temporarily suspended for Vanuatu citizens.

— Yes, Commonwealth scholarships at British universities are available for Vanuatu citizens. The children of investors who received Vanuatu passports under the citizenship by investment program may be eligible to apply for some of these scholarships: for example, the Commonwealth Rutherford Fellowships.

— The short answer is low. I’ll tell you more.

There are no taxes in Vanuatu on wealth, capital gains, inheritance, dividends, interest, global income or stock exchange profits.

In order to legally reduce their taxation, a Vanuatu citizen needs to become a tax resident of the country. To do this, they need to confirm that they spend at least 183 days a year in Vanuatu.

Another way of reducing your tax burden is by registering a company in Vanuatu. International Business Companies (IBCs) established in the country are exempt from taxes for 20 years. Instead of taxes, they make an annual payment of $300 to the government of Vanuatu.

The VAT rate for international companies is 12.5%.

— Yes, Vanuatu citizens can obtain a US B-1/B-2 visa for up to 5 years.

They can submit their application to a US Consulate in any of the countries where they can enter visa-free. The US visa is issued in about 2 weeks.

With a B-1/B-2 visa, the holder can stay in the US for up to 180 days a year. However, you need to apply for a different category of visa if you want to work or study in the US.

— Our lawyers not only accompany our clients until they get citizenship but also provide additional services after they get citizenship.

Most often, our clients contact us with the following requests:

• register a company name in Vanuatu;

• prepare a business license application;

• open a bank account on their behalf;

• renew their passport;

• arrange for the issuance of an ID-card;

• help arrange a birth or marriage certificate to be issued.

— First of all, think of your goals rather than simply follow the fashionable trend when selecting a country for a second passport. When Pavel Durov received a St Kitts and Nevis passport by investment, many of our clients also wanted to apply for citizenship of this particular country.

I hope that in the future one of our famous clients will choose to get a Vanuatu passport: then there will be a dramatic increase in the number of international citizens with a Vanuatu passport. Seriously, the Vanuatu passport is already extremely useful. It makes no sense to make a larger investment in another program if Vanuatu citizenship can help you attain your goals.