Find out how the new residence permit system for foreign investors in Hungary works and what you need to know.
In the context of the recently issued Act XC of 2023 on the General Rules for the Entry and Residence of Third-Country Nationals, Dr. György Zalavári, attorney-at-law, has already analysed the conditions of the visitor investor visa in his previous blog post.
In this post, we will take a look at the most important conditions of the visiting investor residence permit.
A guest investor residence permit is a residence permit which entitles the holder to reside in Hungary and to pursue activities for consideration in accordance with the law, either independently or as a manager of a company, cooperative or other legal entity established for gainful purposes.
A family member of a third-country national who holds a residence permit for a foreign investor may enter and reside in Hungary, as defined by law.
A residence permit for the purpose of family reunification issued to the holder of a residence permit for the purpose of a visiting investor and the related residence permit for the purpose of family reunification entitle the holder to work for or under the direction of another person on the basis of his/her employment relationship for remuneration, and the third-country national is entitled to work in Hungary without any restriction.
A third-country national may be granted a residence permit as a guest investor,
a) whose entry and residence in Hungary is in the interest of the national economy in view of his/her investment in Hungary,
b) who fulfils the following conditions:
- holds a valid travel document,
- has a valid travel permit for the return or onward journey,
- he/she has a valid document proving the purpose of his/her entry and stay,
- has an accommodation or residence in Hungary,
- is not subject to expulsion or prohibition of entry and residence, or if his/her entry or residence does not endanger public policy, public security, national security or public health interests of Hungary,
- is not subject to an SIS alert,
and
c) who holds a valid visitor investor visa, or who is legally residing in Hungary as a third-country national without a visitor investor visa, and who can prove that they meet the following conditions:
- whose entry and residence in Hungary is in the interest of the national economy in view of their investment in Hungary,
- who declares that he has or intends to have at least one of the necessary investments,
- who certifies that he/she has an amount of money corresponding to at least one of the required investments, of legal origin, which must be available or transferable in Hungary,
- who submits a written commitment to undertake to make at least one of the necessary investments within three months of entering the territory of Hungary on the basis of a visitor investor visa.
For the purposes of the Act, the following investments shall be considered to be of national economic interest:
-the acquisition of units of at least EUR 250 000 issued by a real estate fund registered by the National Bank of Hungary,
-the acquisition of ownership of a residential property with a value of at least EUR 500 000, located in the geographical territory of Hungary and registered in the land register according to its parcel number, free of legal title, encumbrances and claims, not including the prohibition of alienation and encumbrance required by law, or
-making a financial donation of at least EUR 1 000 000 to a higher education institution maintained by a public trust with a public-service mission for the purpose of supporting educational, scientific research or artistic creation.
-The maximum period of validity of the residence permit for visiting investors is ten years, renewable for a maximum period of ten years for the same purpose only. The period of validity of a residence permit for visiting investors may exceed the period of validity of the applicant's travel document.
-The third-country national, when applying for the issue of a residence permit for a foreign investor, shall, within three months of his/her entry into the territory of Hungary, provide proof of having fulfilled the obligatory and committed investment via the electronic platform for the opening of aliens' files.
A third-country national who chooses to invest in a real estate fund must have held an investment certificate issued by a real estate fund complying with the legislation for at least five years.
With regard to the expected real estate investment, at the time of acquisition of ownership of the residential property by the third-country national, a prohibition on alienation and encumbrance of the residential property shall be registered in the Land Register for a period of 5 years from the date of conclusion of the sales contract and the property shall be owned for a period of 5 years only by (i) the third-country national or (ii) the third-country national and one or more family members of the third-country national who has applied for the residence permit.