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June 1, 2021
June 1, 2021

Global Investment : A Diversified Gateway

Author By Ajmera Law Group Categories Global Financial Markets, Global Investing How & why?, Global Mutual Funds, Global Stocks, Headlines

The investor considers the products and services that they use daily. It could be anything ranging from shopping on Amazon to streaming movies on OTT platforms like Netflix to the most common, searching for things on Google. Many of these businesses are based outside of India and do not trade on Indian stock exchanges. Why should the 21st Century Investor invest in such global giants?

In the early 1960s, the advantages of foreign diversification were empirically illustrated in financial literature. A few empirical studies have shown that Investors may reduce the chance of their portfolio returns at a significant level of projected return by diversifying through countries whose business cycles were not ideally aligned. We are all well aware that the top Multinationals, Best performing, and High yielding companies also change regularly.

As a result, concentrating all of one’s savings in a single area or asset class is not an effective idea. Another perspective is to profit from the weakening currency. As a result, having a geographically diversified portfolio is a Smart and Sound strategy.

Strategic investment is a craft, and as investors become more knowledgeable of the benefits of equity investing, they are increasingly looking to invest in businesses headquartered in other countries. With most countries’ economies improving, Indian institutional investors are diversifying and broadening their investment horizons to benefit from massive returns on global stock markets.

GLOBAL INVESTMENT OPTIONS

 MUTUAL FUNDS 

This is most likely the most effective and relatively simpler way for investors to gain foreign exposure at a low-cost option. Many Indian fund houses offer such overseas equity investment schemes. For example, a well-known fund house provides index funds that monitor and tracks Nasdaq 100 indices in the United States. Their taxation is almost the same as that of debt funds in India, which means that someone who retains for more than three years is taxed at 20% with indexation.

Few investors may be resistant to global diversification, believing that today’s world is so intertwined that foreign investments may overlap domestic ones. However, this is not the case, since businesses prefer to behave in ways that are dictated by the situation in their home country. They are more likely to respond to local economic and geopolitical issues than to events occurring beyond their boundaries.

LIBERALISED REMITTANCE SCHEME ROUTE

Investors can do so by sending money abroad via the Reserve Bank of India’s Liberalized Remittance Scheme (LRS), which has an annual cap of $250,000 (Approx. 1.8 Cr). The LRS cap expands the range of stocks and funds available to an investor beyond the small selection offered by Indian MUTUAL FUNDs. Transferring capital overseas, on the other hand, is costly as it requires more paperwork, and makes tax filing more difficult for Indian investors.

Besides that, foreign investment takes place in the shadow of official disapproval, particularly when done via the LRS pathway. Aside from the newly implemented TCS, foreign contributions must be registered annually under Schedule FA of the Income Tax returns, and omissions will result in the investor is subject to India’s strict black money laws.

Furthermore, foreign nations such as the United States collect their withholding taxes on dividends, which must be demanded back from India under the Double Taxation Avoidance Treaty (DTAA), which adds an extra layer of paperwork to the process 

INTERNATIONAL STOCKS OR EQUITIES

Global diversification is a well-known investment strategy. It encapsulates the notion that a global portfolio is best secured against country-specific threats like economic recession or political unrest. Investors will also share in the gains of multinational corporations through global earnings.

International securities may provide significant diversification, improving the estimated risk-return profile of a total portfolio as compared to a portfolio that only contains Indian equities. This advantage stems from buying shares in several countries, each of which reacts to market and economic conditions differently

Investors can diversify their portfolios by owning shares denominated in a variety of currencies, each of which behaves differently from the underlying stock price. Different economies and currencies respond to business cycles and global developments in their distinct ways. Investors can reduce total portfolio uncertainty by using these offsetting trends, resulting in a smoother ride with comparable returns as compared to investing solely in Indian Stocks

Depending on whether it is measured in dollars or purchasing power parity, India’s share of the global economy ranges from 3 to 8%. As a result, taking part in the rise of the remaining 92-97 percent of the planet is a clear gain. The United States is a desirable destination.

Apple, Alphabet, Dell, IBM, Procter & Gamble, Facebook, and other global technology giants are listed on the New York Stock Exchange. The rupee’s depreciation against the dollar is another major factor for Indian investors to engage in foreign investment

International securities are viewed as unlisted stocks and are thus taxed at 20% of indexation on retention periods of more than two years. Gains in them are charged at a slab rate on shorter retention times.

To conclude, it is beneficial for investors to diversify internationally, and foreign diversification aids in risk management and portfolio planning for long-term development.

This article is contributed by: Ms. Dishita Sheth, Intern at Ajmera Law Group 

June 1, 2021
June 1, 2021

New Zealand scrutinises to encourage investment immigration

Author By Ajmera Law Group Categories Headlines, New Zealand, Residency & Citizenship by Investment, Residency & Citizenship by Investment and Indian market

The New Zealand government has announced the formation of an inquiry commission to examine the country’s working-age immigration policy, including analysing the skilled migrant visa category and making recommendations on how to enhance investment immigration.

Deputy Prime Minister Grant Robertson said, “This inquiry will enable New Zealand to strategically optimise its immigration settings by taking a system-wide view, including the impact of immigration on the labour market, housing and associated infrastructure, and the natural environment.”

The commission’s mandate includes looking into the effects of rising net migration on housing markets, social cohesion, and the global ecosystems, as well as exchange rates and GDP growth. It will also analyse how the country can address potential labour and skill shortages, as well as whether migrants’ skills are aligned with job opportunities in New Zealand.

The inquiry body will emphasise on “how to attract and gain from investor migrants and entrepreneurial migrants whose expertise, experience, resources, and international ties will help New Zealand’s economic and social development, including through the creation of new businesses, and improving New Zealand’s reach into higher-value industries.”

Other questions the commission will address include whether the perceptions that domestic workers’ jobs are being taken over by migrant workers, especially in the low-skilled category, are accurate or not. Student visas as a pathway to permanent residence would also be scrutinised and closely watched.

Before the deadline of April 30, 2022, the Productivity Commission must present its findings.

In a statement, the Productivity Commission’s Ganesh Nana said, “The Commission looks forward to working alongside Maori and Pacific communities, migrant and ethnic communities, relevant government agencies, skills organisations, partners (the New Zealand Council of Trade Unions, Te Kauae Kaimahi and Business New Zealand), and many others.”

This article is contributed by Ms. Dishita Sheth, Intern at Ajmera Law Group

June 1, 2021
June 1, 2021

USA clears Path for Foreign Entrepreneurs and Start-ups

Author By Ajmera Law Group Categories EB-5 US Investor Visa, Green Card, Headlines, Investor Visa, Residency & Citizenship by Investment and Indian market, US start up visa program, USA

By removing the Trump administration proposal that aimed to kill the initiative, the Biden administration wants to resurrect an immigration program that allows foreign entrepreneurs to operate in the United States.

The International Entrepreneur law, which was then proposed by President Barack Obama’s administration three days before he left office in 2017, enables foreign entrepreneurs to work in the United States for up to five years if their start-ups can raise at least $250,000 from the venture capital in the United States, recruit ten employees, or meet other criteria.

As part of its attempts to revive the program, the Biden administration intends to market it. These actions are in response to demands from venture capital firms, which want the administration to support a program that would encourage thousands of foreign start-up founders to relocate to or stay in the United States to expand their ventures.

The Biden Administration is unlocking an enormous job growth opportunity by incorporating the International Entrepreneur Rule, which will help the United States remain the global leader in innovation,” said Bobby Franklin, the group’s president and chief executive.

“Immigrants in the United States have a long history of entrepreneurship, hard work, and creativity, and their contributions to this nation are incredibly valuable,” said Acting U.S. Citizenship and Immigration Services Director Tracy Renaud.

Currently, there is no visa available for start-up founders in the United States, despite the widespread bipartisan support for the concept. Other visa types must be used for foreign entrepreneurs, but none are ideal.

Between 2017 and 2019, USCIS received only 30 applications for the program, with only one being accepted, according to a USCIS official.

According to USCIS, if the program is properly implemented, about 3,000 international entrepreneurs would qualify per year, resulting in the creation of about 100,000 jobs over a ten-year period.

This article is contributed by Ms. Dishita Sheth, Intern at Ajmera Law Group 

May 30, 2021
May 30, 2021

Ajmera Law Group publishes first edition of Residency and Citizenship by Investment by asset classes!

Author By Ajmera Law Group Categories Headlines, Residency & Citizenship by Investment

As per some of the global organization world is passing through a time where we see the highest number of voluntary migration of human race.

For the last 50 years or we saw human migration for better education and a future for the family.

However, in the last 15-20 years we saw HNI and UNHI are also voluntarily moving from their home country to other parts of the world. In this respect, Residency and citizenship by investment is the most preferred way for HNI and UHNI to move from one country to another country for varsity of reasons.

 Before 2012, we saw only hand full of countries that were offering residency by investment such USA, Canada, the UK, Australia, and New Zealand.

 In 2012, we saw for the first time, Portugal golden visa with investment in real estate followed by several European countries such as Spain, Malta, Cyprus, Greece, Bulgaria, Moldova, Turkey, etc.  These countries mostly offering residency by investment but many attractive terms and conditions for the investors.

 At the same, we saw third group Carrabin countries offering citizenship by investment such as Grenada, St Kitts & Naïves, St. Lucia, Antigua & Barbuda, and Dominica.

 In 2013 we saw forth a group of business immigration to attract start-ups and its founder. Canada was the first country to start with and now followed by now more the 20 countries with a Start-Up visa program.

Not only this, many countries are now amending their program to give more options to investors for making an investment in not only one class but different asset classes.

 In view of the number of countries giving options for investment with residency and citizenship programs, it was the right time to give a comprehensive view of all countries based on asset classes. Said, Prahsnat Ajmera, lawyer, founder, and author of ALG.

 As a law firm, it is our professional duty to present and advise on all investment options to our investors rather than giving limited options of most expensive options.” Added Mr. Ajmera

The firm strongly believes that such publication and comparison will give investors to make well-informed investment decisions.

 The Ajmera Law Group wishes to publish on a yearly basis, residency, and citizenship by investment on asset class basis investment options for HNI and UHNI.

 Residency and Citizenship by Investment (RCI)

options by asset class

Select your residency and citizenship program by investing in an asset class of your choice.

Investment in >>>>>> Real Estate Financial Market / Funds / Bonds  Donation to government development project/fund or such other funds Enterprise / Business – New, Existing, JV Start-up Program Yearly Income
USA No No No Yes Yes No
Canada No No No Yes Yes No
Australia No Yes No Yes Yes No
New Zealand No Yes No Yes Yes No
UK No Yes No Yes Yes No
Ireland No Yes Yes Yes Yes No
EUROPE:            
Portugal Yes Yes Yes Yes Yes Yes
Spain Yes Yes No Yes Yes No
Greece Yes Yes No Yes Yes No
Bulgaria Yes Yes No Yes Yes No
Malta Yes Yes Yes Yes Yes No
Cyprus Yes Yes No Yes Yes No
             
Turkey Yes No Yes Yes Yes Yes
CARIBBEAN:            
St. Kitts & Nevis Yes No Yes No No No
Dominica Yes No Yes Yes No No
Grenada Yes No Yes No No No
St. Lucia Yes yes Yes Yes No No
Antigua & Barbuda Yes No Yes Yes No No

 

Disclaimer:

This is only a general indication of each RCI program. There are many more additional requirements for each program. The investor must seek legal advice from a licensed attorney who is specialized in RCI practice of the respective jurisdiction.

May 26, 2021
May 26, 2021

The US Start-Up Visa Program – Requirements for start-ups who wish to relocate to the USA!

Author By Ajmera Law Group Categories Residency & Citizenship by Investment, US start up visa program

In order to apply under the Start-Up Visa Program of the U.S., start-up founders need to meet the following requirements:

  1. Founder(s) must show themselves as entrepreneurs with a Qualifying Start-up Entity.

Evidence and supporting documents that are filed with the petition must demonstrate that –

(1) The founder(s) have a central and active role to play in the operations of a start-up entity, such that they are well-positioned, due to their knowledge, skills, or experience, to substantially assist the U.S. start-up entity with the growth and success of its business;

(2) Possess at least a 10% ownership stake in the U.S. start-up entity, and that the entity:

(a) Was recently formed (for example, created within the five years immediately preceding the filing of the petition) and has been lawfully doing business within the United States during any period of operation since its date of formation; and

(b) Has substantial potential for rapid growth and job creation, evidenced by the receipt of significant capital investment, grants, or awards.

  1. Substantial Investment, Grant, or Award.

Founders may be considered for entrepreneur parole if they demonstrate that their start-up entity has received a minimum investment amount or qualified award or grant as described below:

(1) The start-up entity has received a qualified investment, within 18 months immediately preceding the filing of the petition, of at least $250,000 US from one or more qualified investors;

(2) The start-up entity has received, within 18 months immediately preceding the filing of the petition, an amount of $100,000 US or more through one or more qualified government awards or grants; or

(3) If the start-up entity partially meets one or more of the above criteria, founders may still be considered for entrepreneur parole by providing other reliable and compelling evidence of the start-up entity’s substantial potential for rapid growth and job creation.

A lesser amount can be considered on a case-by-case basis if it can be shown that it is substantial.

  1. The investment must be from a ‘Qualified Investor’.

The term ‘qualified investor’ for purpose of entrepreneur parole means an individual who is a U.S. citizen or lawful permanent resident of the United States, or an organization that is located in the United States and operates through a legal entity organized under the laws of the United States or any state, that is majority-owned and controlled, directly and indirectly, by U.S. citizens or lawful permanent residents of the United States, provided such individual or organization regularly makes substantial investments in start-up entities that subsequently exhibit substantial growth in terms of revenue generation or job creation.

Such an individual or organization may be considered a ‘qualified investor’ if, during the preceding five years:

(1) The individual or organization has made investments in start-up entities in exchange for convertible debt or another security convertible into equity commonly used in financing transactions within their respective industries comprising a total in such 5-year period of no less than $600,000 US; and

(2) Subsequent to such investment by such individual or organization, at least 2 such entities have each created at least 5 qualified jobs or generated at least $500,000 US in revenue with average annualized revenue growth of at least 20%.

  1. Additional Supporting Evidence.

Additional supporting evidence concerning the start-up entity’s business, its substantial potential for rapid growth and job creation as well as the founders’ day-to-day role in the business has to be submitted.

If the start-up entity partially meets the qualified investment, government grant, or award criteria, founders may be still considered for parole by providing other reliable and compelling evidence that the start-up entity has substantial potential for rapid growth and job creation.

Such supporting evidence may include, but is not limited to, the following:

(a) Evidence of rapid growth, such as – number of users or customers, revenue generated by the start-up entity, additional investments/fundraising, including crowdfunding platforms

(b) Social impact of the start-up entity

(c) National scope of the start-up entity

(d) Positive effects on the start-up entity’s locality or region

(e) Any other reliable and compelling evidence that the start-up entity has substantial potential for rapid growth and job creation.

May 26, 2021
May 26, 2021

A large number of Indians are returning home from the UK

Author By Ajmera Law Group Categories Headlines, Residency & Citizenship by Investment, UK, UK Business Visa - Start-Up and Innovators

These are unfortunate cases that reflect the plight of individuals and families who went to the UK without proper guidance and advice from immigration lawyers. They were advised by unregulated, inexperienced agents and consultants in India who give them false hopes about settling and starting a new life in the UK.

The hype and myth created by agents and consultants make vulnerable students and parents believe that once they study or arrive in the UK, their life is sorted and they will be able to settle there permanently. There are many individuals who go to the UK on a visitor visa and stay back in the UK as per the ill advice of their agents or consultants. They are lured by fabricated stories of how these agents and consultants managed to ‘settle’ thousands of such individuals in the UK because of their so-called ‘connections’. The honeytrap of these agents and consultants is – once you reach there, everything will be okay. Just leave India.

Gullible youngsters and parents often fall prey to these schemes and blindly fall into these traps. Our office has encountered a number of such cases whereby the careers and lives of these individuals are completely ruined.

Refer to media release – click here

May 26, 2021
May 26, 2021

US clears path for foreign entrepreneurs and start-ups

Author By Ajmera Law Group Categories Residency & Citizenship by Investment

By removing the Trump administration’s proposal that aimed to kill the initiative, the Biden administration wants to resurrect an immigration program that allows foreign entrepreneurs to operate in the United States.

The International Entrepreneur Law, which was proposed by President Barack Obama’s administration three days before he left office in 2017, enables foreign entrepreneurs to work in the United States for up to five years if their start-ups can raise at least $250,000 US from the venture capital in United States, recruit ten employees, or meet other criteria.

As part of its attempts to revive the program, the Biden administration intends to market it aggressively. These actions are in response to demands from venture capital firms which want the administration to support a program that would encourage thousands of foreign start-up founders to relocate to or stay in the United States to expand their ventures.

“The Biden administration is unlocking an enormous job growth opportunity by incorporating the International Entrepreneur Rule which will help the United States remain the global leader in innovation,” said Bobby Franklin, President & CEO of the National Venture Capital Association (NVCA), the venture community’s preeminent trade association focused on empowering the next generation of transformative American companies.

“Immigrants in the United States have a long history of entrepreneurship, hard work, and creativity, and their contributions to this nation are incredibly valuable,” said Tracy Renaud, Acting U.S. Citizenship and Immigration Services Director.

Currently, there is no visa available for start-up founders in the United States, despite the widespread bipartisan support for the concept. Other visa types must be used for foreign entrepreneurs, but none are ideal.

Between 2017 and 2019, USCIS received only 30 applications for the program, with only one being accepted, according to a USCIS official.

According to USCIS, if the program is properly implemented, about 3,000 international entrepreneurs would qualify per year, resulting in the creation of about 100,000 jobs over a ten-year period.

Note: This article is contributed by Ms. Dishita Sheth – Intern at Ajmera Law Group.

May 1, 2021
May 1, 2021

President Biden includes India to the List of COVID-19 Public Health Travel Ban Countries

Author By Ajmera Law Group Categories Headlines, Residency & Citizenship by Investment, USA

The Main Points to be noted for this ban are: 

(i) President Biden has issued a proclamation imposing a COVID-19 public health travel ban on foreign nationals with a recent physical presence in India. This same type of travel ban is already in effect for Brazil, China, Iran, Ireland, countries in the European Schengen Area, South Africa, and the United Kingdom.

(ii) Starting at 12:01 am EDT on May 4, 2021, foreign nationals who have been physically present in India within 14 days of travel to the United States will be barred from entry, unless they qualify for an exception.

(ii) Consular operations in India are at a significantly reduced capacity due to the COVID pandemic, so those seeking exceptions to the new ban from a U.S. consulate are likely to experience delays and challenges.

Today, President Joseph Biden issued a presidential proclamation imposing a COVID-19 public health travel ban which prohibits the entry of foreign nationals who have been physically present in India within 14 days of their travel to the United States.  The India ban restrictions take effect at 12:01 am EDT on May 4, 2021.

However following people will not be affected:

  • U.S. citizens and nationals;
  • U.S. lawful permanent residents;
  • Spouses of U.S. citizens and lawful permanent residents;
  • A foreign national who is the parent or legal guardian of an unmarried U.S. citizen or lawful permanent resident under the age of 21;
  • A foreign national who is the sibling of a U.S. citizen or lawful permanent resident, provided they are both under 21;
  • A foreign national who is the child, foster child or ward of a U.S. citizen or lawful permanent resident, or who is a prospective adoptee seeking to enter the United States on an IR-4 or IH-4 visa;
  • A foreign national traveling at the invitation of the U.S. government for a purpose related to containment or mitigation of the COVID-19 virus;
  • A foreign air or sea crewmember;
  • Certain A, C, E-1 (TECRO or TECO employees), G, and NATO nonimmigrants or whose travel falls within the scope of section 11 of the United Nations Headquarters Agreement;
  • A foreign national whose entry would further important U.S. law enforcement objectives;
  • A foreign national whose entry would be in the national interest; and
  • Members of the U.S. armed forces and their spouses and children.

An updated guideline will be issued by the US  government which may allow the travel of those Indian citizens who can apply for travel to the US under the national interest exception.

For more information and legal opinion contact our office.

April 29, 2021
April 29, 2021

Are you looking for a second home in the world!

Author By Ajmera Law Group Categories Residency & Citizenship by Investment

A quick analysis of the Residency & Citizenship by investment program of the world!!

Ajmera Law Group’s analysis and comparison of RCI programs of several countries will surprise you.

To attract the right kind of global businesspersons and entrepreneurs to their countries, two G-7 countries have reduced the investment amount which is now the lowest in the world.

 

Name of the country Investment amount Name  of the visa program  
USA US$ 200,000 to 1,800,000 Non-Immigrant L1, E2 visa, and Green card under EB-5
Ireland € 500,000 Permanente residency
Australia A$ 500,000 Business innovation Stream (Provisional to PR)
New Zealand NZ$ 100,000 Permanente residency
Canada CD$ 100,000 PNP Business program ( temporary residency to PR)
UK £ 50,000 Innovator visa (ILR)
Malta € 250,000 Permanente residency
Cyprus € 300,000 Permanente residency
Portugal € 350,000-500,000 Golden Visa – Permanente residency
Spain € 500,000 Golden Visa – Permanente residency
Greece € 250,000 Golden Visa – Permanente residency
Bulgaria € 512,000 Permanente residency
Turkey US$ 250,000 Citizenship
Grenada US$ 150,000 Citizenship
Carrabin Countries US$ 100,000+ Citizenship

 

April 20, 2021
April 20, 2021

How many Indian HNIs have permanently left India for a new home? – The real story!

Author By Ajmera Law Group Categories Headlines, Residency & Citizenship by Investment and Indian market

How many Indian HNIs really left India?                        

In the last few years, we have time and again read articles in the Indian media with the following eyeball grabbing headlines:

Being in the immigration industry with more than 28 years of experience, I was intrigued by these headlines and the alleged figures. Yes, India’s rich and famous are leaving the country and opting for a second passport but the numbers cited in many of these articles seemed preposterous.

I decided to do some research to determine if this was true. I picked out the last article and tried to reach the author of the article.  He was nice enough to send me the report which was referred to in this article. He also sent me a note saying – ‘Our figures are estimates’. 

I also reached out to the bank which has been part of the same report and quoted in several pressnote. The bank, however, has not replied to my email.

Regulatory Bank of India

 

Here is the official data from the Reserve Bank of India (the regulatory bank in India) of the remittance/investment made by Indian citizens overseas in the last 4 years.

Outward remittances/investments made under the Liberalised Remittance Scheme (LRS) for Resident Individuals / Indian Citizens – Published by Reserve Bank of India (RBI)
(US$ Million)
Item 2016-17 2017-18 2018-19 2019-20 TOTAL of Four years
         
1 Outward Remittance under the LRS – TOTAL for the year 8,170.7 11,333.6 13,787.58 18,751.40 52,043.28
1.1 Deposit 283.8 414.9 455.94 623.37 1778.01 Investment
1.2 Purchase of immovable property 92.9 89.6 84.53 86.43 353.46 Investment
1.3 Investment in equity/debt 443.6 441.8 422.90 431.41 1739.71 Investment
1.4 Gift 749.5 1,169.7 1370.24 1904.53 5193.97 Expenses
1.5 Donations 8.8 8.5 8.67 22.32 48.29 Expenses
1.6 Travel 2,568.0 4,022.1 4803.81 6954.20 18348.11 Expenses
1.7 Maintenance of close relatives 2,169.5 2,937.4 2800.88 3437.46 11345.24 Expenses
1.8 Medical Treatment 17.3 27.5 28.59 33.88 107.27 Expenses
1.9 Studies Abroad 1,536.4 2,021.4 3569.87 4989.04 12116.71 Expenses
1.10 Others 300.8 200.6 242.15 268.74 1012.29 Expenses
Note: 1.10: Includes items such as a subscription to journals, maintenance of investment abroad, student loan repayments, and credit card payments.

 

We can plainly see from the above RBI data that the ‘estimates’ cited in most reports and their subsequent press notes are nowhere near the actual figures. It appears that these articles/press notes are nothing more than self-serving paid advertorials.

By creating a hype that a large number of Indians are leaving the country by opting for a second passport, they perhaps want to popularize the Residency & Citizenship by Investment programs offered by different countries in India. They hope that rich Indians will join the bandwagon and sign up for these programs.

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