Nationals of countries not members of the European Union (EU) and European Economic Area (EEA) interested in European residency can opt for new Hungarian residence permits. In July 2024, Hungary officially launched the Guest Investor Program, dubbed as ‘Golden Visa’ scheme. Almost simultaneously, Hungarian authorities updated regulations on issuing so-called National Cards by expanding the list of eligible countries. If the Hungarian ‘Golden Visa’ grants a 10-year residence permit, extendable for the same period, National Cards are temporary residence permits issued on a work basis and valid for two years, with a possibility to renew it for a period of three years unlimited times, provided that certain conditions are met.
The Guest Investor Visa
Hungarian ‘Golden Visa’ applicants must make an investment that aligns with Hungary’s economic interests. There are three eligible investment avenues:
- Investment in a real estate fund: Acquiring a share worth at least €250,000 in a real estate fund registered by the Hungarian National Bank.
- Property ownership: Purchasing a residential property in Hungary valued at least €500,000. The property must be free of liens and claims, and it must be registered in the Land Registry under a unique parcel identification number. This option will be available only from January 1, 2025.
- Educational, scientific, or artistic donation: Contributing at least €1 million to a Hungarian public trust supporting educational, research, or artistic endeavors.
Application Process
Applicants must submit their ‘Golden Visa’ applications while legally staying in Hungary. This can be done either online through the Enter Hungary platform, or in person, at the appropriate National Directorate-General for Aliens Policing (NDGAP) regional directorate, according to the applicant’s place of residence in Hungary.
Applicants must provide proof of their investment within three months of entering the country. This needs to be completed before submitting the residence permit application. Applicants are required to appear in person at any NDGAP office to provide fingerprints and have their photograph taken, even if they applied electronically.
The immigration authority will process applications within 21 days. Once approved, the residence permit will be delivered to the address provided. If an applicant is unable to receive the document by post, they may request to collect it in person with proper justification.
Permit Validity
The Guest Investor Visas are valid for 10 years and may be extended for an additional 10 years. During the permit’s validity period, any changes to the investment must be reported within 5 days via the Enter Hungary platform. The permit also allows the holder to work and run a business in Hungary without restrictions.
Obstacles to the Program Implementation
According to Investment Migration Insider – the online media outlet covering citizenship and residency by investment programs worldwide, the Guest Investor Visa program has faced significant delays, particularly concerning the real estate fund investment option, which is the least expensive avenue to qualify for ‘Golden Visa’ starting from €250,000. The Hungarian government introduced new requirements mandating that only investment units from fund managers listed as “qualified market operators” are acceptable. This list is maintained by the Constitution Protection Office, part of the Hungarian Internal Security intelligence agency, and includes fund managers who have passed a preliminary national security screening. Fund managers were informed of this new obligation just weeks before the program’s start on July 1st, leading to a backlog as they submitted their applications and supporting documents. By the end of July, no fund managers had been authorized as qualified market operators, causing significant delays and uncertainty.
The real estate ownership option with an investment threshold of €500,000 will be available only starting January 1st, 2025. This delay has created obstacles for investors, as the program cannot be fully utilized until that date. Investors might be concerned about how this timeline affects their plans, particularly regarding property acquisition and eligibility under the program. Hence, from the program’s inception, only the €1 million non-refundable donation option is available, which looks less attractive compared to the other two real estate options that can count on returns on investment (ROI).
National Cards
Hungary has introduced the National Card (Nemzeti Kártya), a residence permit for third-country nationals who seek employment or operate a business in Hungary. Initially, the program was designed for only Serbian and Ukrainian citizens, however, the list of eligible nationals was extended in July 2024, adding six more countries: Bosnia & Herzegovina, North Macedonia, Belarus, Moldova, Montenegro, and the Russian Federation.
To be eligible, applicants must satisfy one of the following conditions:
- Engage in paid work under an employment contract, including through a temporary work agency, or
- Actively work as the owner or chief executive of a firm established in Hungary for gainful activity, in addition to their duties in this role.
Application Process
Applications can be submitted either outside Hungary through diplomatic missions or within the country via the Enter Hungary platform. Employers may also apply on behalf of employees with written consent. Applicants must provide documents proving their employment, means of subsistence, accommodation, and health insurance.
Benefits of National Card
Hungarian National Card applicants are not required to have unique or high qualifications. The initial card has a two-year validity and can be extended for three years. Extensions are allowed unlimited times.
National Card holders have the right to family unification. After three years of legally residing in Hungary, it’s possible to apply for permanent residency.
Changing residency status can be performed can be requested without leaving the country.
The straightforward application process and multiple benefits associated with Hungarian residency make National Cards much more attractive than regular work permits.
Restrictions and Exclusions
There are certain restrictions and exclusions related to National Cards. For instance, individuals whose presence in Hungary poses a threat to public or national security are not eligible. Additionally, those subject to expulsion or an entry ban, or who have a criminal record, are excluded from obtaining the card.
Furthermore, the card cannot be granted to individuals holding residence permits for specific purposes, such as seasonal employment or guest workers.
Guest Investor Visas vs. National Cards
The National Card is a new residence permit for select third-country nationals, allowing them to live and work in Hungary. On the other hand, the Guest Investor visa is designed to attract foreign investment by granting residence permits to third-country nationals whose investments are deemed to be in Hungary’s national economic interest.
National Card applicants must either work for remuneration under an employment relationship or be the owner or chief executive of a legal entity established for gainful activity. The permit is valid for two years and can be renewed for three-year periods indefinitely. Renewal requires a valid residence permit, residing in Hungary for at least 90 days in any 180 days, and passing a cultural knowledge exam. However, Russian, Ukrainian, and Serbian nationals are exempt from this exam. Contrary to this, there are no residency requirements for Guest Investor visa holders and they must not pass a cultural knowledge exam either. The Guest Investor visas grant holders residence permits valid for ten years with an option to renew them for another ten years provided that the investment is maintained.
Both programs share common elements like application procedures, issuance methods, processing times, and requirements for Hungarian addresses, health insurance, and biometric information. However, National Cards differ from the Golden Visas in key ways. It provides temporary residency for specific nationalities, with the possibility of multiple renewals. Unlike the Golden Visa, the National Card enforces stricter criteria, such as the requirement for actual residence and employment in Hungary, making it more focused on active participation in the local economy.
Critics of Hungarian Residence Permits
This move to include Russians and Byelorussians on the list of eligible nationals for the Hungarian National Card has caused controversy among other EU-member nations. During the pending Russian-Ukrainian military confrontation, such affordability may create substantial security risks. A group of sixty-seven members of the European Parliament has urged the European Commission to investigate the Hungarian decision. Critics are concerned that Russian spies might misuse the National Card to travel freely within the EU. The absence of quotas or limits, along with the possibility of endless renewals, heightens these worries even further.
Nevertheless, Hungarian authorities assure their EU counterparts that due diligence and vetting procedures of applicants can mitigate those risks. So far, there is no indication that Hungarians will scrap or reform some provisions of their new immigration legislation.