EU: EU ‘crisis’ as small country vows to keep controversial golden passport scheme

Malta is at the centre of a brewing crisis with the European Union as it remains the last member state to operate the controversial “golden passport” scheme.

This program allows foreigners to effectively purchase an EU citizenship by investing at least €690,000 (£577,840).

The practice has drawn intense criticism from Brussels due to concerns over security, money laundering, and the integrity of an EU citizenship.

Despite pressure from the European Commission, which has urged Malta to terminate the program, a legal opinion issued on October 4 by Advocate General Anthony Collins for the Court of Justice of the European Union may provide a legal reprieve.

In his non-binding report, Collins said that citizenship decisions rest solely with individual member states.

He wrote: “Member States have decided that it is for each of them alone to determine who is entitled to be one of their nationals and, as a consequence, who is an EU citizen.”

This interpretation has caused tension within the EU, with the Commission arguing that Malta’s golden passport scheme undermines the bloc’s principles of “sincere cooperation and security”.

The European Commission launched legal action two years ago, taking Malta to court over its investor citizenship program, accusing it of violating EU laws.

Daily Life In Brussels
Daily Life In Brussels
© Getty
The Commission has argued that granting citizenship without any genuine link to the member state is incompatible with the values of the Union.

In 2022, the EU Justice Commissioner Didier Reynders said: “EU values are not for sale.”

Nonetheless, the sale of passports has proven a big hit for Malta, generating around £670 million between 2014 and 2020.

Related video: EU ‘prepared to compromise on youth mobility scheme with UK’ to get deal over the line (Dailymotion)

However, following Russia’s invasion of Ukraine, Malta suspended its scheme for Russian and Belarusian nationals but continues to offer it to other nationalities.

This decision has drawn additional scrutiny from the EU, which seeks tighter regulations on similar programs across Europe.

Golden passport programs have been gradually phased out in other EU countries. Cyprus scrapped its scheme in 2020, and Bulgaria followed suit in 2022.

Other member states, such as Portugal and Spain, have revised or scaled back their golden visa programs, which offer residence permits to high-net-worth individuals.

The Court of Justice is expected to issue a ruling soon, which could impact the future of Malta’s citizenship-for-investment scheme.

However, as of now, the Maltese government remains adamant that its policies do not contravene EU treaties.

14 November 2024

EU: European Commission puts forward proposal (DAC9) to simplify Pillar 2 implementation

The European Commission has proposed amendments to the European Union (“EU”) Directive on administrative cooperation in taxation (“DAC9”). These changes aim to facilitate the exchange of top-up

Read More
29 April 2024

CHINA: China and Europe agreed on the development of the circular economy

The recently presented plan outlines the joint efforts of the EU and China to implement the Memorandum of Understanding between the union and the world’s most populous country on the circular

Read More
20 January 2024

INTERNATIONAL TAX: Nearly three quarters of millionaires polled in G20 countries support higher taxes on wealth

Polling comes as 260 millionaires and billionaires sign new letter, directed at political leaders attending the World Economic Forum in Davos, saying they would be “Proud To Pay More” in taxes.

Read More
16 February 2024

US: US, five European countries extend truce over digital taxes until mid-2024

The U.S. and five European countries agreed on Thursday to extend a trade truce over digital services taxes for six months to buy more time for negotiations on international taxing rights over large,

Read More