LexisNexis’ LexisPSL (a leading UK legal publisher) recently interviewed LEXLAW’s High Net Worth Immigration Team on ‘whether Malta could set a trend for selling EU citizenship?’ We commented on the Maltese Citizenship Act 2013 and the ‘Individual Investor Programme’. Investors of €650,000 (£546,000) are set to receive Maltese and EU citizenship, passports, work and residency rights in the 28 EU member state bloc.
The full LexisPSL report is available for download here: LexisPSL – ‘Citizenship_for_sale’ – LEXLAW
Maltese Parliament’s Proposal to Sell EU Citizenship
Malta’s parliament approved a plan to sell citizenship of the island for EUR 650,000 for each non-European Union applicant on 12 November. Prime Minister Joseph Muscat said the programme was meant to bring in revenue to the country and would earn the government EUR 30m in its first year. The passports would also give applicants work and residency rights in the rest of the 28-member EU bloc. However plans have now been put on hold indefinitely, following a massive international and national outcry, until terms can be agreed.
Not the First Country to Sell EU Citizenship
Malta’s policy of selling citizenship to foreign investors is not unprecedented. The Maltese government is following the example of a number of other EU member states who have similar policies which effectively market and sell EU citizenship:
- the UK offers the Tier 1 Investor and Entrepreneur visa to attract high net worth individuals to invest in the UK
- Portugal recently introduced a scheme in which individuals can obtain Portuguese citizenship by investing either EUR 1m in financial assets over five years or EUR 500,000 in property or by creating ten jobs
- the Republic of Ireland has a scheme in which Irish citizenship is granted to individuals investing at least EUR 500,000 in the Irish economy
- Cyprus offers citizenship to individuals investing EUR 5m in Cypriot property or depositing EUR 3m in a Cypriot bank
- Spain is currently offering citizenship to investors in return for an investment of as little as EUR 160,000 (approximately £133,500) in order to revive its flagging property sector.
- Austria offers citizenship to individuals ‘rendering exceptional services in the interest of the Republic’
- several non-EU countries, such as Dominica and St. Kitts and Nevis have long enacted similar policies
The Tier 1 investor visa offered by the UK is regarded as the leading option for non-EU high net worth investors seeking to obtain the benefits of UK and EU citizenship. We advise high net worth clients on the UK’s Tier 1 investor scheme in which individuals who invest millions in the UK can obtain British citizenship as early as three years under a fast track route. Investors should consider very carefully the country in which they decide to invest because (as demonstrated by the recent Cypriot financial crisis) some economies are more stable and secure than others for foreign investors.
Maltese Citizenship for Non-EEA Nationals (High Net Worth Individuals)
The Maltese government has recently passed the Maltese Citizenship Act 2013, which allows individuals seeking Maltese citizenship to apply for a Certificate of Naturalisation by contributing to an ‘individual investor programme’.
Requirements for Obtaining Maltese Citizenship
Under the terms of this programme, applicants need to invest EUR 650,000 into the Maltese economy, of which EUR 10,000 will be a non-refundable deposit. Furthermore, applicants will also need to provide deposits of EUR 25,000 each for spouses and individual children below 18 years of age, and deposits of EUR 50,000 each for dependent parents aged 55 or over and unmarried children aged between 18 and 25.
Benefits of EU Citizenship for High Net Worth Migrants
Due to Malta’s membership of the EU in 2004, Maltese citizens are EU citizens thereby enjoy the right to enter, study and work freely in other EU member states, as well as the right to vote or stand as a candidate both in elections to the European Parliament and in municipal elections in the EU member state in which they reside.
Furthermore, Maltese citizens are able to benefit from the Schengen visa, which allows entry into twenty-five other European countries without requiring prior entry clearance or visa.
Malta also has a visa waiver agreement with the USA, as a result of which Maltese citizens can enjoy the right to enter the USA as visitors. An individual purchasing Maltese citizenship would therefore be able to enjoy these benefits in the same way as any other Maltese citizen.
Wealthy Foreign Nationals Can Keep Dual Citizenship
Dual citizenship was heavily restricted under Maltese law from independence in 1964 until 2000, when all such restrictions were removed. Any individual who purchases Maltese citizenship would therefore not be required to terminate their previous citizenship.
Concerns & Criticisms of Malta’s Immigration Policy
The policy has attracted a lot of controversy in Malta where many nationalists have viewed this as an insult to the country. The Nationalist Party (who are the main opposition party) have warned that such a policy leads to Malta being compared to offshore tax haven island countries such as those typically in the Caribbean. An anti-migration demonstration was planned outside the Maltese Houses of Parliament in Valletta but was declared illegal by the Maltese Police and subsequently cancelled.
M Ali Akram
LEXLAW, 1 Middle Temple Lane, London
First published 28 November 2013 by LexisPSL