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What makes Downs, Saavedra foreign loophole easy to exploit

After revelations that Erwin Saavedra could be registered as a local via a naturalization process, KickOff analyzes what is required for the Bolivian to skip normal permanent residency rules.

Sundowns, as is normally the case during a particular transfer window, have to juggle around the foreign quota issue, with only five players from outside the country allowed to be registered by a club with the PSL.

READ: Esquivel loses his cool on debut after Downs exit

In order to comply, head coach Manqoba Mngqithi indicated in radio interviews that Saavedra, who has returned after a loan spell at Club Bolivar, could be registered as a local through a naturalization process.

Another way clubs can register foreign players as locals in South Africa is the exception given by the state in cases where a foreigner has stayed in the country for a period of five consecutive years, in which case such a foreigner is granted permanent residency.

Foreign players such as goalkeeper Denis Onyango and Peter Shalulile, for instance, enjoy the privilege of being registered as locals after they obtained permanent residency for staying five or more consecutive years in the country.

However, another way a foreign national can obtain permanent residency and therefore be considered a local is through a financially independent permit (FIP), which is reserved for wealthy individuals or people with a high net worth.

The Brazilians, as referred also by Mngqithi, used the same technicality or loophole in immigration rules in South Africa, after Dutch defender Alje Schut qualified as such an individual, with high net worth assets in 2015.

What makes the loophole easier to navigate for high net worth individuals, is that the assets or investments don't have to be in the country to be evaluated as qualifying for FIP.

In 2015, the amount that was required to obtain an FIP was a minimum of R7 million of assets in the foreign individual's name, which Schut reportedly proved to the State.

According to reports, the former Masandawana defender's net worth was weighed through his pension scheme that was in the Netherlands.

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Currently, to qualify for a financially independent permit, you are required to have assets or investments of at least R12 million, regardless of whether they are in the country or not.

Assets such as immovable property, investments and cash balances are weighed against the foreign individual's debts.

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