In a significant ruling, the EU's Court of Justice declared Malta's citizenship program, which allows foreigners to garner citizenship through financial means, as illegal under European law.
Malta's Golden Passport Scheme Ruled Unlawful by EU's Top Court
Malta's Golden Passport Scheme Ruled Unlawful by EU's Top Court
The EU's Court of Justice declares Malta's citizenship-by-investment program violates European law and risks fines for non-compliance.
Malta's controversial golden passport scheme, which enables individuals to become citizens through substantial financial investment, has been ruled unlawful by the European Union's Court of Justice. This scheme, allowing foreigners to acquire a Maltese passport—and consequently the freedom to live and work across EU nations—required investments starting from €600,000 (£509,619), rental or purchase of property at designated values, and a charitable donation of €10,000.
The court's decision comes after the European Commission pursued legal action against Malta in 2022, asserting that the program transforms citizenship acquisition into a commercial transaction, which violates EU law. The court emphasized that "the acquisition of Union citizenship cannot result from a commercial transaction."
Former Prime Minister Joseph Muscat has criticized the ruling as "political" and believes that the program could persist with modifications. Malta's government has yet to formally respond to the judgment, but it faces the potential of significant fines should it choose not to comply.
Amidst ongoing discussions, Malta has defended its stance, arguing its interpretation of EU treaties is sound. Notably, in 2022, the scheme was suspended for nationals from Russia and Belarus amid geopolitical tensions following Russia's invasion of Ukraine and a subsequent crackdown on individuals linked to the Kremlin.
The Court's ruling contrasts with an earlier opinion from Advocate General Anthony Collins, who stated that the Commission had not sufficiently demonstrated that EU law obligates a “genuine link” between an individual and the country to justify legal citizenship. He argued it is within the rights of each EU member state to determine their criteria for national citizenship.
However, the court declared that Malta's investor scheme undermines "mutual trust" among member states and reiterated the EU's previous calls to abolish such practices, citing inherent risks such as money laundering, tax evasion, and corruption aligned with citizenship-for-investment programs.
