7 myths about Vanuatu citizenship by investment

Why do myths last so long?

CBI programs are a young tool. Most of them are under 30 years old. Vanuatu launched its Development Support Program (DSP) in its current form in 2017. During this time, thousands of articles, forums and “expert” comments have appeared - some of them are outdated, some were written by competitors, some are simply incorrect.

The result is that the client comes with a dozen fears that have no relation to reality. Let's look at each myth in order.

Read more about the program itself in our Complete Guide to Vanuatu Citizenship.

Myth 1. “Vanuatu is an offshore for draft dodgers”

This is the most common misconception. People confuse offshore jurisdiction for business with citizenship by investment. These are different things.

The Vanuatu citizenship program has been officially operational since 2017. The country is a member of the FATF registers and complies with international financial monitoring standards. Each applicant undergoes a multi-level due diligence check - biography, source of funds, criminal history.

Vanuatu is not on the EU money laundering blacklist or graylist for CBI purposes. The program is transparent: the state publishes annual reports, sets quotas and tightens requirements for agents.

Practical advice. If reputation is important to you, ask the agent about specific requirements for the source of funds. A legitimate program is when they ask the questions, and not you hide from the questions.

Myth 2. “No trip means a grey scheme”

The programme is designed so that applicants do not have to fly to the islands, and this is the official procedure, not a warning sign. Documents are certified and apostilled in the country of residence, a licensed agent submits the application and the oath is taken remotely.

One step is done in person: biometrics are given in Moscow, St Petersburg, Dubai, Hong Kong or Port Vila. The passport is not issued without them.

St Kitts and Nevis, Antigua and Barbuda and Grenada work in a similar way. Filing through an agent is a matter of logistics, not of legal status.

Practical advice. Check that your agent is licensed to work with the Vanuatu citizenship programme.

Myth 3. “A Vanuatu passport is good for nothing”

Without a prior visa a Vanuatu passport opens about 97 countries and territories: 42 visa-free, 30 with a visa on arrival, 3 with an electronic travel authorisation and 22 dependent territories. About 39 more countries issue an e-visa online. The visa-free list includes Singapore, Malaysia, the Philippines, Fiji and much of the Caribbean and Latin America.

Schengen and the UK require a visa: the EU fully suspended visa-free travel from 4 February 2023 and the UK introduced visas on 19 July 2023. Vanuatu citizens who want to live in Europe apply for residence in Greece or Hungary, and this is a common scenario among our clients.

The United States requires a visa. Grenadian citizenship suits those who need the US E-2 investor visa. Vanuatu solves a different task: speed, budget and a first step towards European residence.

Read more in our article on visa-free countries for the Vanuatu passport.

Practical advice. List the countries you travel to most often and compare them with the visa-free access of your current passport and a Vanuatu passport.

Myth 4. “Processing takes a few weeks”

Vanuatu is faster than many programmes, but “a few weeks” does not match practice.

The approximate timeline is 2-3 months from submission of a complete application. Another 2-4 weeks go on collecting and certifying documents on the applicant's side. If due diligence needs more information, the timeline grows.

Practical advice. If you need the passport by a certain date, for a deal or a move, say so before submission so that preparation is planned around it.

Myth 5. “Russian citizenship will have to be lost”

This is one of the main fears of Russian clients. And it is not justified.

Russian legislation does not prohibit having a second passport. The law only obliges you to notify the Ministry of Internal Affairs within 60 days after receiving foreign citizenship - through the MFC or by mail. There are no sanctions for the very fact of second citizenship.

Important clarification: if you permanently reside abroad, the notification is submitted upon your first entry into Russia. This is an administrative procedure and is not an approval or authorization.

For citizens of Kazakhstan, the situation is different - Kazakhstan does not officially allow dual citizenship. Citizenship of Vanuatu in this case requires a separate legal analysis.

Practical advice. Check the rules of your country specifically. For Russia - notification, not refusal. This is a fundamental difference.

Myth 6. “The contribution can never be returned”

Vanuatu has two programmes, and the answer depends on the choice. The DSP contribution is non-refundable: it is a donation to the development fund, from $130,000 for a single applicant to $180,000 for a couple with two children.

In the second programme, the CIIP fund, a family of up to four pays $157,000 in one sum, and after 5 years the government buys back the share and returns $50,000.

The conclusion is simple: DSP suits a single applicant better, while a family of four or more usually benefits from the fund. For a couple or a family of three it depends on whether you are ready to leave $50,000 in the fund for five years.

Practical advice. Compare both programmes for your family in the Vanuatu citizenship cost calculator.

Myth 7. “You can skip DD and save money”

Due diligence is mandatory for everyone without exception. This is not an agent's option - it is a requirement of the Vanuatu State Commission.

DD checks the applicant's background, source of funds, criminal records, sanctions lists. All adult family members included in the application are verified. It is impossible to bypass the check - the absence of DD results means an automatic refusal to consider.

An agent who offers to "save on DD" either does not understand the procedure or is offering something illegal. Both options are bad.

Practical advice. Budget DD as a mandatory item. More details about the full composition of expenses are in the next section.

Real cost: all expenses down to the penny

Here is a complete table of costs for Vanuatu citizenship. No hidden lines.

Total for 1 applicant: from $138,000-140,000 including fees.

Total for a family of 4 people (2 adults + 2 children): from $187,000-195,000 including all fees.

A detailed analysis of the cost is in the article how much does Vanuatu citizenship cost?.

How is due diligence checked?

DD is not a formality. Vanuatu vets applicants more seriously than many realize.

The procedure includes several levels. The first is automatic verification against international sanctions lists (OFAC, EU, UN). The second is checking against open databases for mentions in investigations, court cases, and scandals. The third is an analysis of the source of funds: statements, tax returns, ownership documents.

All adult family members are checked. If at least one receives a DD refusal, the entire application is stopped.

What will definitely lead to refusal: existing sanctions, criminal convictions, connections to organized crime, refusals in other CBI programs. The latter is especially important - all programs exchange information about failures.

Practical advice. Tell your agent about any “sensitive” aspects of your biography before submitting. It's better to know about the problem in advance than to lose $5,000 on DD with no results.

Vanuatu versus other CBI programs

Why choose Vanuatu rather than St. Kitts or Dominica?

The main argument is speed. 2-3 months versus 4-6 months in most Caribbean programmes. For those who need a passport quickly, this is a deciding factor.

The second argument is the cost of entry. From $130,000 per applicant, cheaper than St. Kitts ($250,000+) or Antigua ($230,000+).

Where Vanuatu loses: the passport does not open to the United States (there is no E-2 agreement), the program does not provide European residency. If the goal is access to the US or EU, it is better to look at other programs.

Read a detailed comparison of programs on the page Vanuatu citizenship by investment.

What documents are actually needed?

The standard package includes a passport (current + previous ones), birth certificate, certificate of no criminal record (from each country of residence for the last 10 years), confirmation of the source of funds, photographs, medical insurance.

For the family, the following are added: marriage certificate, birth certificates of children, adoption documents (if any).

All documents not in English or French must be translated by a certified translator and certified with an apostille. This takes time and costs money - allow 2-4 weeks just for collection and certification.

A common mistake. The criminal record certificate must be recent - most jurisdictions accept the document no older than 3-6 months. Don't get it too early.

What happens after receiving a passport

The passport is issued for a period of 5 years with the possibility of extension. There are no residency requirements - you are not required to live in Vanuatu or even visit the country.

Citizenship is transferred to children by right of descent. Children born after you become a Vanuatu citizen are automatically entitled to a passport.

Vanuatu's tax system does not tax global income. If you become a Vanuatu tax resident, you do not need to pay tax on your foreign earnings. But tax residency is a separate procedure and not an automatic consequence of citizenship.

Important. Before changing your tax residence, consult with a tax advisor in your country of current residence. Exiting Russian tax residency, for example, has its own rules and deadlines.

The real risks of the programme

A review of myths is incomplete without the risks.

The first risk concerns programme terms. The Vanuatu government has changed contribution amounts and due diligence requirements, so terms must be checked again on the date of application.

The second risk concerns travel. Visa-free travel to the EU has been fully suspended since 4 February 2023, and the UK introduced visas in July 2023. That is why the European scenario is built through residence: Greek or Hungarian residence for Vanuatu citizens.

The third risk concerns the agent. Applications go through a licensed agent, and government payments should be made only to official accounts.

Practical advice. Before paying, check the agent's licence and ask for an estimate that separates government payments from service fees.

Who is eligible for Vanuatu citizenship?

The program works well for specific tasks. Here is a typical portrait of a suitable client.

You are a citizen of Russia, Kazakhstan or Ukraine. You need a second passport quickly - up to 3 months. Priority - Schengen, UK, Singapore. The budget for one is up to $150,000. There are no immediate plans for the USA.

Or: you do business in several countries, fly frequently, and your current passport creates queues at consulates. Vanuatu gives you mobility without relocation and without residency requirements.

Who is not suitable for: those who want to enter the United States through E-2, who need European permanent residence or EU citizenship, and for whom return on investment is important.

Summary: what to remember

The Vanuatu citizenship programme is legal and one of the fastest among investment programmes. Myths about it usually come from confusion with offshore schemes and outdated information about visa-free travel.

The seven myths come down to three conclusions. First, the programme is legal and every applicant is checked by the Financial Intelligence Unit. Second, without a prior visa the passport opens about 97 countries and territories, and it leads to Europe through Greek or Hungarian residence. Third, the DSP contribution is non-refundable, the CIIP fund returns $50,000, due diligence is mandatory and the timeline is 2-3 months.

If you are considering a second passport, start with the tasks it should solve. We will help you see whether Vanuatu fits your situation.

More about the programme: Vanuatu citizenship by investment.

BRIDGES analysis on this topic: what the programme means for the budget, Vanuatu after the EU visa-free suspension.