China’s push back on dual passports may derail investment immigration schemes
- Mainland authorities may tighten up on the practice of holding citizenship rights in countries other than China, potentially impacting high-net-worth individuals
- Potential crackdown on second passport holders would dampen Chinese enthusiasm for investing in overseas property, experts say
Global real estate investment flows could be disrupted if the authorities in mainland China were to crack down on the country’s booming trade in second passports.
Tens of thousands of high-net-worth individuals in the mainland could be affected if authorities restricted the practice of buying property in a foreign country as a way of acquiring a second citizenship, experts said.
The possibility of such action was highlighted earlier this month when Sun Xiang, a National People’s Congress delegate from Hebei province, was outed on social media as having a passport from the Caribbean island nation of Saint Kitts and Nevis, issued in 2011. He was removed from office two days after the post went up on August 4.
Beijing does not recognise dual nationality, and any individual who obtains a second passport is required to renounce their Chinese citizenship.
“This high-profile second citizenship scandal could lead to a crackdown on wealthy and influential Chinese who have obtained second and even third passports without renouncing their Chinese citizenship,” said David Lesperance, an international citizenship and tax law expert at Lesperance & Associates. “Tens of thousands of individuals in mainland China likely have a second passport.”
Such a crackdown was likely to dampen Chinese enthusiasm for investing in overseas property for the purpose of gaining citizenship, Lesperance said.