Vanuatu passport

[Paratore]

Why would the banks not see place of birth of Moscow, Shenzhen, or Washington DC on a Vanuatu passport and immediately ask about other citizenships during KYC? Even if the document was fraudulent. “Ok Mr. Momoa, everything looks in order.” [to the Russian accented blond blue-eyed white man with place of birth in Vanuatu]. If it’s some borderline crypto exchange that doesn’t care, use a $300 USD Palau e-residence card. Well, you still have to off-ramp somewhere legitimate later.

Use it to cloak travel by switching passports? First, Vanuatu is not an airport hub. Second, if you are one of those who can only have one passport, how does this work?” Mr. Zhang, how did you spend so much time in Vanuatu?” “Well, I have a second…” Wait, that only works with permanent residence cards. Third, permanent residency costs less than $130,000 USD and will work just as well for the first part of that.

Maybe if you have zero other options in terms of second passports (never true). You can always fall back on the visa-free travel. I guess you have Russia and the Philippines. Still, I recall people here getting access to Russia for far less than $130,000 USD.

Vanuatu is part of CRS. “But I’m a tax resident.” “Then supporting documentation should be no problem. By the way, what is your other citizenship? Just asking.”

You could live there I suppose.

An Interpol Red Notice has name, date of birth, and nationalities listed. Reputational KYC services are likely to find past indictments. I suspect a Vanuatu passport will subject you to EDD and that will be a part of it. Unless you change your biographical data and keep the two personas completely separate this is not going to hide you.

The unstated part is that you are doing something illegal as part of getting one of these and that is what makes it work. Or else I just don’t know enough about how the financial system works. Someone educate me and tell me how I am wrong.

 

[JohnnyDoe]

Someone educate me and tell me how I am wrong.

you are 100% right.
As explained here Citizenship is not a tax strategy: no bs guide to tax residence the real use cases of a passport are limited.
If you want to play smart games, then use friends, you can find imaginary ones that look very much like you 😉

 

[Paratore]

you are 100% right.
As explained here Citizenship is not a tax strategy: no bs guide to tax residence the real use cases of a passport are limited.
If you want to play smart games, then use friends, you can find imaginary ones that look very much like you 😉

Excuse my rambling here. I don’t want to go over there and defecate all over the guy’s Vanuatu/Guinea-Bissau passport business model in his own thread. With a Canadian or Italian passport, for example, there are some niche benefits.

• There are a few (very few) institutions that will allow Canadian citizens to open accounts while residing abroad. Of course, you will be reporting your other citizenships and settling taxes under the appropriate DTA. It can still be useful for investment. See some companies returns on TSX plus CAD fluctuations over the past year. Counterpoint: Why even bother? Invest elsewhere. Decent returns are everywhere.
• An Italian passport makes it easier to open a simple bank account there and get a card that uses SEPA for use during travel in Europe. Or to use the Trenitalia mobile app. You can get into some museums for free. Counterpoint: Use a credit card with no FX fee and a percentage cash back. Use the Trenitalia website. I’ve already seen the museums.
• One could live in Canada or the EU which is a bit of a different prospect than doing such in Vanuatu. Counterpoint: Taxes. Residence permits don’t much care which passport they are in.
• Children can easily qualify for local university tuition rates which is a large cost reduction. Counterpoint: You are making too many assumptions about how a life may turn out decades in the future.
• There is the largely superfluous ease of travel. Counterpoint: It’s superfluous.
• They could in some unlikely cases make operating in certain regions slightly easier or safer. One would have gotten faster repatriation flights out of Dubai had he not driven across the border and left via Muscat, for example. Counterpoint: These are all contrived examples and extremely improbable.
• You can use them while another passport is being renewed or out due to a visa application. Counterpoint: This can be just as easily mitigated by proper planning and how often do you need visas, anyway?
• It will save tiny amounts of money on ETAs. Counterpoint: Extremely bad RoI here.
• If one needed to travel to China, it would save relatively expensive visa fees (RoI on the Canadian passport would be about 100% with just one trip here). Counterpoint: There are only a few countries like this and the math only works on one passport because it was obtained so cheaply.
• You are flying back from Africa/ME through AMS or CDG and due to flight delays you miss the last flight to North America that day but have already hit your 90/180 in Schengen. Counterpoint: This is approaching “if frogs had wings they wouldn’t bump their asses on the ground when they hopped” levels of fantasy scenario.

But these are very specific cases and minor, mostly theoretical benefits. It borders on justification. I made a compelling counterpoint for each one. In terms of business and serious banking they add nothing. The passports mostly sit in a drawer and presumably provide some form of mental reassurance. And neither is a Vanuatu passport, of course, which offers none of the above. Neither of the above cost six figures, either.

That is my experience. I live a boring life, admittedly, and probably do not understand the more esoteric aspects of international business. But at least I get to use eGates in the airports. If someone has a better use case, my ears are open to learn more.

 

[Paratore]

There are some business and banking benefits but they fall squarely into the “You could, but why would you want to?” category.

• Being exempted from the Canadian property ban. Canada bans foreign individuals or foreign controlled business entities from purchasing certain types of real property in Census Metropolitan Areas or Census Agglomerations. I’m a citizen, so I can buy what I want. It seems that I don’t want to buy anything, though.
• Establishing a Canadian controlled corporation. Canada distinguishes between Canadian controlled corporations and non-Canadian controlled corporations based on residence, not citizenship, and imposes a Canadian resident director quota of a minimum of 25% on federal corporations plus non-resident shareholder limitations. This matters in taxation law and in activities like real estate purchases. Citizenship does provide a smoother path to establishing residence and substance should I ever desire. I do not desire.
• Canada to US ACH transfers. Canadian banks use EFT and Interac. US banks use ACH and Zelle. However, ACH does function between Canadian and US banks. This is more of a curiosity than anything useful. It is another method for moving funds, though.
• Limited personal bank access. Canadian banks will open non-business accounts for non-resident Canadians. Very few allow online onboarding and these will be fintech or online-only institutions. Some of the Big 5 will allow in person account opening for non-resident Canadians. Canadian banks tend to have excessive fees. I have discovered a couple of good ones.
• Ease of establishing presence and substance in the EU. An Italian passport simplifies the path to residence and substance in some of the EU’s more business friendly jurisdictions. This is the most useful of the list. However, the DTA between Italy and San Marino takes the latter completely off the board.
• Streamlined Italian real estate purchases, probably. I haven’t looked into this because…why? But I believe it reduces administrative tasks somewhat. Italy is a nice place to visit but I don’t want to own real estate there.
• Limited personal banking access. Italian banks will offer extremely basic personal accounts to non-resident Italians. This doesn’t extend to much beyond a Euro account and a SEPA card. The maintenance fees on a basic Italian account, especially a conto corrente non residenti, are higher than one would expect. There is no real benefit here. There are better ways to do this.
• I believe creating some European business structures with an EU nation passport reduces your CRR when going through KYC but this is not backed by any evidence. Purely speculative and probably not significant if real.
• The Italian passport probably streamlines the process of creating an Italian corporate structure but I have not looked into this and cannot imagine why one would want to do this.
• The use of either passport might let one slide by KYC with some borderline cryptocurrency exchanges or banking jurisdictions. You’ll often have issues with movement of funds in and out of these so the benefit is dubious. It’s trading one problem for another.

Once again, it seems we are back to eGates

 

[Paratore]

Those are three western passports with minimal incremental benefits gained for the two added. Let’s dig into Vanuatu a bit more while ignoring the illegal things. This is research. I’ve not done any of this myself.

You can live in Vanuatu and become a tax resident. The tax laws appear to be quite good. You can do this with either a permanent residence or citizenship by investment. Either way, you will require legal resident status, 183 days of presence, and a center of interest via permanent address and ties.

That is 183 days on small islands in the Pacific. Time zone is GMT+10. That means Los Angeles +18, New York +15, London +10, Dubai +7, and Singapore +3. Flight times from VLI to:

• Narita - 17 hours, one connection
• Changi - 17 hours, two connections
• Kuala Lumpur - 18 hours, two connections
• Brisbane - 3 hours, direct
• Los Angeles - 17 hours, one connection

Vanuatu is on the EU list of non-cooperative tax jurisdictions. It was removed from the FATF money laundering blacklist in 2018. Vanuatu is considered a high risk jurisdiction by the OECD. EDD is mandatory when presenting a Vanuatu passport in most jurisdictions. Practical acceptance is reported to be challenging in most major jurisdictions. It also is reported to be challenging to get tax residence in Vanuatu accepted by banks and other governments.

Vanuatu is a CRS signatory. It has provisions for IBCs. It has a VASP framework. Property is available to citizens on the typical South Pacific leasehold model.

Vanuatu banks do not have many correspondent banking relationships at the moment. NBV supposedly lost their USD correspondence. Local banks are functional for local matters. It is said that it is easier for citizens to open accounts at them. Opening accounts seems to require an in-person visit.

Visa-free travel is limited. You’ll get Singapore, Panama, Malaysia, Russia, Thailand, and a smattering of other countries. It does get you a passport that can be used to apply for visas and travel. If you are Russian or Ukrainian and cannot renew your passport because you are fleeing conscription then it is something.

It’s probably useful in cases where anything is better than nothing or for illegal activities. It has its own challenges.

 

[jafo]

Very good points! Thanks for publishing this! I enjoyed reading and learning from it.

PS. I got better things to do with my $130K

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One point only I'd like to clarify: "illegal"
There is a HUGE distinction between "MALA IN SE" crimes, we all KNOW this is wrong and the State is the number one violator of this vs. "MALA Prohibita" crimes, where we all know is just empty weak human vessels who are control freaks that push their corruption on the rest of us.

The unstated part is that you are doing something illegal as part of getting one of these and that is what makes it work

 

[Paratore]

Very good points! Thanks for publishing this! I enjoyed reading and learning from it.

PS. I got better things to do with my $130K

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One point only I'd like to clarify: "illegal"
There is a HUGE distinction between "MALA IN SE" crimes, we all KNOW this is wrong and the State is the number one violator of this vs. "MALA Prohibita" crimes, where we all know is just empty weak human vessels who are control freaks that push their corruption on the rest of us.



View attachment 918

I like to think there must be a victim for a crime to exist. The state disagrees with me.

 

[JohnnyDoe]

You can live in Vanuatu

That’s indeed the only real perk.

That is 183 days on small islands in the Pacific.

Not too bad.

Time zone is GMT+10. That means Los Angeles +18, New York +15, London +10, Dubai +7, and Singapore +3. Flight times from VLI to:

• Narita - 17 hours, one connection
• Changi - 17 hours, two connections
• Kuala Lumpur - 18 hours, two connections
• Brisbane - 3 hours, direct
• Los Angeles - 17 hours, one connection

Almost ideal if you are a bit of a sociopath and enjoy being on your own, not disturbed by the rest of the world and far from reach of creditors. On the picturesque island of Malekula cannibalism was practiced until at least 1969: this is what used to happen to those adventuring there and daring to disturb locals.
Also convenient if you want to live in the Cook Islands and setup a base somewhere in the region.

Vanuatu is on the EU list of non-cooperative tax jurisdictions.

I guess they couldn’t care less.

Vanuatu banks

ANZ should still work fine. I used to use it until some years ago.

 

[JohnnyDoe]

PS. I got better things to do with my $130K

Until you decide to move to Vanuatu and don’t want to bother with a residence permit.

View attachment 918

“moral” is a human invention, like religion, and it differs widely across the world. In fact, some of the examples in your list are in some parts of the world or were at some point in the past not considered wrong.
The only real crimes are those against the right to property, from which freedom derives and by which is limited.

 

[Paratore]

That’s indeed the only real perk.

Not too bad.

Almost ideal if you are a bit of a sociopath and enjoy being on your own, not disturbed by the rest of the world and far from reach of creditors. On the picturesque island of Malekula cannibalism was practiced until at least 1969: this is what used to happen to those adventuring there and daring to disturb locals.
Also convenient if you want to live in the Cook Islands and setup a base somewhere in the region.


I guess they couldn’t care less.

ANZ should still work fine. I used to use it until some years ago.

The blacklist does appear to hinder use of the passport in banking.

From the perspective of time zone, it’s not too bad if your life is Asia-centric. It’s convenient to Australia. Still, those flight routings to anywhere else…

It could work for some people. It seems like those cases are fairly specific to circumstances.