The Uber effect - to survive EU antagonism, investment migration must look inward

Thought Leadership by Ahmad Abbas, Head of Corporate Services at Investment Migration Insider

When Uber began taking over the world of public transportation, an interesting phenomenon began appearing in countries worldwide. Taxi drivers started protesting and questioning the authenticity and validity of the app. This led to various problems, strikes, and overall unease.

The taxi drivers, understandably, were scared for their livelihood as a new threat entered the market. However, their main folly was fighting it, not adapting to it, and eventually, Uber cemented its place in the market, and it was too late for the cab industry to react.

Now you may be wondering why I am talking about a minor transportation issue in a piece about investment migration, but bear with me, as the similarities between what happened with Uber’s rapid takeover and the EU’s antagonism towards citizenship and residency by investment (RCBI) are uncanny.

Firstly, just like taxi drivers labelled Uber as the big baddy striving to strip them of their income, RCBI firms view the EU as the same thing: a scary threat to their businesses. Secondly, taxi drivers are a discrete bunch of professionals who have little coordination between themselves and who actively compete against each other for greater market share. RCBI firms are in the same pool, as they have no coordinating body to drive them together, and they are at odds in a very competitive market.

“In essence, ignoring the EU’s antagonism would be folly; bowing to it would be worse.”

While the scale of investment migration and the overall status of the industry is not comparable to public transportation, the third and most important similarity highlights how much we can learn from the Uber story;

RCBI stakeholders are actively opposing the EU’s viewpoint, not adapting to it.

Instead of labelling the EU’s stance as unfounded, RCBI professionals should aim to look inward and address their shortcomings before it’s too late.

However, that doesn’t mean the industry should surrender and bare all to the EU. It just has to fill the gaps that give naysayers the foundations for their arguments.

While giving the EU full access to any given RCBI programme’s internal information has been touted as a good starting point, doing so without optimising the process and rooting out the issues would result in an even worse scenario.

Once RCBI finds and implements robust solutions to its problems, it can share specific information with any interested parties. Enhancing transparency is always good but tearing down the entire Chinese Wall should be considered an unfathomable mistake.

In essence, ignoring the EU’s antagonism would be folly; bowing to it would be worse.

Achieving perfect harmony between appeasing outsiders and safeguarding sensitive internal information is not easy, but it starts with a few simple - and vital - steps.

The first is addressing any allegations against the authenticity and transparency of any RCBI programme. This requires full commitment from all the stakeholders in any given programme. Governments must address their internal process, use of funds, and due diligence standards at the same time as cracking down on agents and fake agents.

Agents are the face of any programme, and any offering a shady deal to clients or marketing an unauthorised discounted price will put a programme and its government under the microscope.

The entire process begins at an RCBI firm’s doorstep, and first impressions last. If RCBI professionals are willing to damage the image of a programme, or worse yet, put its integrity on the line, for a quick sale, then any accusations flying around are automatically substantiated in the eyes of the public.

Much like our cab-driving friends, RCBI firms seem to be looking at their immediate income and how they can compete with a counterpart that offers a lower office fee. Undercutting each other to the point where nothing is left to cut but the programme’s government-set fees is swimming in dangerous waters. RCBI firms need to think about the continuity of their business, not the next fiscal quarter.

Greater government oversight would help close many of the gaps that mainstream media and foreign governments use to attack the industry, but we can go a step further.

Transparency is also key, and showing some skin goes a long way, as long as we decide what to bare and what to keep private. The EU doesn’t need full access to know what’s going on and giving them what they need - and nothing more - would do the trick. But the more information and data a government puts on public record, the greater the integrity of the programme. If you are doing nothing wrong, then you have nothing to hide.

Another major step is social responsibility. RCBI firms need to show that they are not only exhausting a programme for as much money as they can make but are a part of the community. Adding a small fee to each file and allocating a percentage of their office fees to go directly into social development projects such as parks, schools, or otherwise in the country they are representing would go a long way in improving the industry’s image, creating a direct charitable link between the investor and their new home, and would highlight how investment migration helps all aspects of a community through tangible assets.

The path forward for investment migration is fraught with challenges, and the only way to successfully navigate it is by working on our internal affairs and leaving no gaps for outsiders to use against us. Once we fix that, any claims lobbied against investment migration can be rebuffed with real numbers and hard facts. Crying injustice and not doing anything about it will only lead down one path. Just ask your next cab driver.