Paraguay ends the deposit route to immediate permanent residency

For years Paraguay was known for one of the quickest permanent residencies in the world. A foreigner could place a solvency deposit of about US$5,000 in a Paraguayan bank, file the paperwork and receive permanent status within months, without first living in the country on a temporary basis. That route has now closed.

Law 6984/2022, the new Migration Law, was promulgated by President Mario Abdo Benítez on October 17, 2022 and published in the official gazette on October 18, taking effect that day. It repeals in full Law 978 of 1996, the migration law that had governed residency for a quarter of a century and on which the deposit route was based.

What the deposit route was

Under the old law, applicants had to prove economic solvency, meaning they could support themselves in Paraguay. In practice many did so by placing a deposit of 32 million guaraníes, about US$4,500 at recent exchange rates and widely described as US$5,000, with a Paraguayan bank. That deposit, together with the usual documents, supported an application for permanent residency straight away. It made Paraguay a popular first residency for people looking for a low cost, lasting second status.

With the old law repealed, the National Directorate of Migration, the agency that grants residency, has stopped accepting new applications under it. Files already lodged under Law 978 will continue to be processed.

The new structure: temporary first, then permanent

The new law introduces a two stage model for most applicants:

• Temporary residency for up to two years. This replaces the one year temporary status of the old law and can be extended for the same period. No bank deposit is required to obtain it.
• An identity card from the start. For the first time, temporary residents can obtain a cédula, the Paraguayan national identity card, valid for as long as their residence. Under the old law only permanent residents could get one, and in daily life the cédula is what opens bank accounts and signs contracts.
• Permanent residency after the temporary period. Foreigners who intend to settle indefinitely apply for permanent residency once their temporary term is complete.
• Renewal every ten years. Permanent residence cards issued under the new law, and the cédula that goes with them, must be renewed every ten years. Cards issued under the old law are not affected, because the new law does not apply retroactively.

The government has 180 days from October 18 to issue implementing regulations, which will set out detailed requirements and fees.

The routes that still go straight to permanent

The new law keeps a direct path to permanent residency for certain groups. The most relevant for foreigners without family ties to Paraguay is the investor route. Applicants who can prove an investment in Paraguay under Law 4986/2013, which created SUACE, the government’s one stop system for opening and registering businesses, are exempt from the temporary stage. The investment commonly cited for this route is at least US$70,000 in a business. Foreign spouses, children and grandchildren under 18 of Paraguayan nationals also qualify directly, and existing arrangements such as the Mercosur residence agreement remain in force.

What it means if you are considering Paraguay

Paraguay is still one of the more accessible residencies in the world. The difference is time: for most people, permanent residency now comes after a temporary period of up to two years rather than at the outset. In return, the temporary stage is longer, simpler and comes with a cédula, so daily life in the country can start straight away.

For someone planning ahead, the practical steps are to start the temporary application early, keep documents such as police clearances and birth certificates apostilled and translated, and use the temporary period to build the genuine ties and activity that will support the permanent application. Those with a business plan may prefer the investor route. We help clients prepare and file their applications, work with our local team, and quote our fees in writing.

This article is general information, not legal, tax or investment advice.