Portugal’s new Nationality Law opened a crisis between the government and foreign investors who invested millions of euros in the country, betting on easier access to European citizenship.
The changes, enacted this month by President António José Seguro, extended the minimum time for naturalization, tightened immigration criteria and have already taken hundreds of holders of golden visas preparing actions against the Portuguese State.
The group brings together mainly Americans, but also includes Brazilians and investors of other nationalities who joined the residency-by-investment program created by Lisbon after the 2008 economic crisis.
The main impact falls precisely on foreigners who used investment residence programs as a gateway to the European Union.
Until then, five years of legal residence were enough to apply for Portuguese citizenship. With the new legislation, the period increased to seven years in the case of Brazilians, citizens of the Community of Portuguese Speaking Countries (CPLP) and Europeans. For other foreigners, the requirement increases to ten years.
In addition to the increase in the deadline, another change began to worry lawyers and investors. The counting of residence time no longer takes into account the date of the migration request and becomes valid only after the effective issuance of the residence permit by the Agency for Integration, Migrations and Asylum (AIMA).
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In practice, this could further lengthen the wait for Portuguese citizenship due to administrative delays accumulated in the country.
The text also changed rules for children of immigrants born in Portugal. Previously, it was enough for one of the parents to reside in the country for one year for the child to have the automatic right to Portuguese citizenship. Now, the minimum period required is five years of regular residence.
The changes were approved by the Portuguese Parliament with the support of right-wing and extreme right-wing parties, after review by the Portuguese Constitutional Court on points considered unconstitutional in the original proposal.
In the immigration and investment market, the effect has already started to appear. According to Portuguese vehicles, more than 500 foreigners holding visas gold discuss a collective action against the Portuguese State alleging breach of legal trust and change of rules during processes that have already started.
Immigration lawyer Jessika Aguiar states that the change directly affected investors who structured assets and residence based on the previous model.
“The legislative change reignited an important debate about legal security and protection of the legitimate confidence of foreign investors in Portugal. Many of the clients who joined the program made large investments based on a specific legal framework and legitimate expectations regarding the deadlines then in force for access to Portuguese nationality”, he states.
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“When there are relevant changes in the course of these processes, especially without clear transitional rules for those who were already in an advanced stage of residence, it is natural for legal challenges to arise and a feeling of insecurity among international investors”, he adds.
Created in 2012, during the European economic crisis, the golden visas has become one of the main tools for attracting foreign capital in Portugal. More than 12 thousand investors have joined the model since its creation, including Americans, Chinese, Brazilians and Russians.
For years, the real estate market was the main driver of the program. Foreigners were able to obtain a residence permit by purchasing properties in cities such as Lisbon and Porto.
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The model, however, began to suffer internal criticism in the face of soaring housing prices and the increasing difficulty of access to housing for the Brazilian population.
In 2023, the Portuguese government had already reduced part of the program’s advantages by removing real estate investments from the eligible modalities for obtaining visas.
Currently, the main paths involve financial contributions of at least €500,000 in investment funds intended for the capitalization of Portuguese companies, in addition to options linked to scientific research, cultural production and job creation.
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The European Union also pressures countries in the bloc against citizenship-by-investment programs, alleging risks linked to tax evasion, money laundering and security, as Portuguese nationality guarantees free movement within the Schengen area.
For lawyer Rafaela Barbosa, the legal debate tends to grow precisely because some investors had already initiated processes under previous rules.
“The change in the rules applicable to investors who had already started their residency processes raises relevant legal discussions in light of the principles of legal certainty, the protection of legitimate expectations and the good faith of the State”, he states.
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“Many foreigners structured million-dollar investments in Portugal based on a specific legal regime, which strengthens the thesis that subsequent changes cannot disproportionately meet legitimately constituted expectations”, he adds.
