In case of violations, a EU passport may be issued to criminals involved in money laundering and other financial crimes. The European Commission considers this possibility unacceptable.
If the European Commission decides that an investment programme for Maltese citizenship violates EU law, it will issue an official warning to the government. This is where the procedure for investigating violations will begin.
Malta's citizenship programme for investment has been criticised by the European Union before. So far, the state has been able to maintain the investment programme. If the EU initiates an investigation, Malta may be forced to postpone the restart of the programme. We remind you that it was originally planned for September 2020.
The reaction of the Government of Malta to criticism of the European Union
In April 2020, the European Commission sent an official request to the Government of Malta to close its investment citizenship programme. At the same time, Malta retained the right to make a final decision at the national level.
In July 2020, Malta responded to the criticism of the European Union. Alex Muscat, Parliamentary Secretary for Citizenship, stated that the country had no plans to close the citizenship programme. He made several arguments in favour of this decision.
Reasons why Malta seeks to retain its citizenship programme for investment:
- Between 2013 and 2019, the programme brought the country €1.4 billion. Foreign investments support the island's economy, and the money earned goes to healthcare, construction and social projects.
- Malta conducts the most stringent investor Due Diligence. The country issues only about 300 passports for investment per year, while rejecting about 23% of applications under the programme.
- EU criticism does not take into account the positive impact of the programmes on the economies of the entire region. Citizenship programme participants are given the opportunity to live and do business in any EU country. This ensures an inflow of investments into the economies of different countries.
Malta has expressed its willingness to listen to the European Union in order to ensure maximum transparency of all procedures. In this regard, the Government has announced a restart of the citizenship programme for investment.
We talked about the Maltese government's argument in "Malta: the citizenship programme will continue to work despite EU criticisms".
Restart and new conditions of the Malta Citizenship Programme for investment
In July 2020, the Parliament of Malta passed amendments to the Citizenship Act. The amendments update the terms of the Citizenship for Investment Programme.
Under the new conditions, the investor first obtains a resident status and a residence permit card. You can only apply for Maltese citizenship after a year or 3 years of maintaining this status. In this way the investor confirms his or her intentions and connection with the country.
The cost of participation in the programme will depend on the time taken to apply for citizenship. If a year has passed since the issuance of the residence permit card, the minimum investment amount will be 750 000 €. If the investor plans to apply for citizenship in 3 years - 600 000 €. In this case, the minimum amount for buying real estate will double: from 350 000 € to 700 000 €.
The Due Diligence procedure will be strengthened. The national government intends to make the due diligence stricter in order to provide a full guarantee of security for new citizens. All measures will be in line with the EU policy on combating the financing of terrorism and money laundering.
We have described all the upcoming changes in the material "Restart of the Malta Citizenship Programme for Investment in September 2020".
We expect the Government of Malta to launch the updated citizenship programme shortly. The Programme Department is now finalizing the processing of applications under the old rules.