The €50,000 deposit in Andorra has long been a fundamental requirement for those seeking to obtain passive or self-employed residence in the Principality. However, the legislative landscape in Andorra is constantly evolving, and a significant change is about to reshape this well-known deposit. The new ‘Law on the Continuity and Consolidation of Measures for Sustainable Growth’ drastically alters the nature of this guarantee, turning it into a non-reimbursable income. If you are planning your move to Andorra, it is crucial to understand how this new regulation affects you and what it means for your initial investment.
This legislative adjustment is not an isolated event but part of a broader strategy by the Andorran government to ensure sustainable and selective growth, tightening entry conditions for new residents. Below, we detail all the aspects of this change and other important modifications in the immigration law you should be aware of.
What changes with the new €50,000 contribution to the AFA?
The most impactful change in the new law, also known as ‘Omnibus Law 2’, is the transformation of the deposit before the Andorran Financial Authority (AFA). What was previously a recoverable guarantee now becomes a permanent contribution to the State. Let’s analyze the key differences.
From a refundable deposit to a non-refundable income
Until now, the Immigration Law required establishing a deposit of €50,000 with the AFA. While this amount did not accrue interest (it was not remunerated), it was fully refunded if the individual decided to leave the country or if their residence authorization was not renewed or was canceled. Essentially, it functioned as a guarantee.
Under the new legislation, this concept entirely disappears. The law now refers to a “contribution” made “on a definitive basis”. This means that the €50,000 becomes a non-refundable contribution. The text clearly states that the funds “are not reimbursable”. The only exception to refunding the money is if the initial application for immigration is denied by the authorities.
Who is affected by this new measure?
This fundamental change in the financial requirement affects two main groups seeking to establish residence in the Principality:
- Passive residents: They are the group most directly impacted. Besides the main contribution, the law also applies to dependents. For each dependent, an additional contribution of €12,000 must be made, also with a definitive and non-reimbursable nature.
- Self-employed residents: Those applying for residence permits to carry out self-employment activities must also meet this €50,000 contribution. It is important to highlight that there is an exception for qualified professionals, who are exempt from this specific requirement, although they are subject to the previously established reserve regime that already applied to other applicants.
Overall tightening of residence requirements
This change to the €50,000 deposit is part of a broader tightening of the conditions to obtain residence in Andorra. The government aims to attract residents who not only meet economic criteria but also demonstrate a genuine and long-term commitment to the country. The non-refundable contribution aims to disincentivize speculative or temporary residences, ensuring that those settling in the Principality contribute directly to the State’s coffers.
In addition to this measure, there has been a confirmed increase in mandatory investments in Andorran assets for passive residence applicants, strengthening the trend to make the process more selective and demanding. These changes underline the importance of seeking expert advice to navigate the complex Andorran regulatory framework.
New regulations for workers and seasonal workers
The ‘Omnibus Law 2’ not only focuses on passive and self-employed residents but also introduces significant updates in the regulation of temporary workers, a key sector of Andorra’s economy, especially in tourism and winter industries.
On-site contracts and business flexibility
The law more specifically regulates temporary authorizations through the system of on-site hiring. This system involves collective management of contracts for workers selected in their countries of origin. One of the most relevant innovations, introduced during the commission stage, is flexibility for companies. If a company is part of a corporate group or has multiple workplaces, the contracted employee can work at any of them, providing greater operational agility.
The end of fixed-term periods between seasonal contracts
Until now, the law established a mandatory five-month period between the end of one seasonal contract and the start of another. This rigidity prevented, for example, linking the winter season with summer, affecting both companies and employees. With the new regulation, this fixed period will no longer be stipulated by law. From the date of entry into force, the government will establish this period by regulation. This measure gives the authorities the power to adapt the deadlines to the needs of the labor market, providing a more dynamic response to economic demands.
Stricter measures against migration fraud
The new legislation also strengthens tools to combat fraud attempts in obtaining residence permits. In response to alerts from local authorities about fake marriages, the law broadens the classification of infractions.
Any “simulation” of relationships—whether romantic, family, or even economic—intended to obtain an immigration authorization will be considered an offense. Penalties for such fraudulent practices have been toughened:
- General fines: Ranging from €3,000 to €6,000.
- Enhanced sanctions: If deception aims to evade economic requirements related to passive or self-employed residence, fines can be up to “double the amount the state failed to collect”.
These measures reflect the firm will of Andorran authorities to preserve the integrity of their immigration system and ensure permits are granted only to those who legitimately meet all requirements.
Conclusion: What does this change mean for your future in Andorra?
The transformation of the €50,000 deposit in Andorra into a non-refundable contribution is a paradigm shift. It is no longer a guarantee but an initial non-recoverable investment demonstrating financial commitment to the Principality. This tightening, along with other amendments, sends a clear message: Andorra seeks orderly and sustainable growth, prioritizing residents and investors willing to establish long-term ties with the country.
If you are considering living in Andorra, it is more important than ever to be well-informed and to have professional support. Navigating these legislative changes can be complex, and mistakes could jeopardize your relocation project. To ensure compliance with all new regulations and understand how these changes impact your specific case, do not hesitate to contact our team of experts. We will guide you every step of the way to make your move to Andorra a success.