The creation of the Malta Individual Investor Programme (MIIP) was motivated by the benefits that economic passport systems have generated in other countries, both inside and outside Europe. The Maltese citizenship-by-investment programme is intended to enhance Malta’s offering in this area.
The MIIP is the first programme that, for a pre-determined contribution to a Maltese sovereign fund, results in the attainment of European citizenship within a year. The hope is that the MIIP will attract successful, entrepreneurial people, and capital.
Overview
Maltese citizenship by investment may be granted under an amendment passed in November 2013 to the Maltese Citizenship Act, chapter 188 of the Laws of Malta. The amendment provided the framework for the enactment of Legal Notice 47 of 2014, the MIIP rules.
The MIIP rules provide for affluent persons of impeccable standing and repute to be naturalised and receive Maltese citizenship on the basis of a contribution to, and investment in, Malta.
Eligibility for Maltese citizenship
To be eligible for the citizenship-by-investment programme, applicants must:
- pass the ‘fit and proper test’ – i.e. have a clean criminal record and be in good health;
- contribute a non-refundable EUR650,000 to the government fund;
- invest EUR150,000 in government bonds for five years;
- commit to retaining a residence in Malta for five years, either by buying a property with a minimum value of EUR350,000 or renting a property with a minimum annual rent of more than EUR16,000; and
- demonstrate a genuine link with Malta for one year.
Dependants eligible for citizenship include unmarried children up to the age of 25 and parents over 55.
Consensus and EU endorsement
The launch of the programme elicited mixed reactions. As a result, parliamentary debate ensued both domestically and at the European level. For four months, the MIIP was scrutinised from a constitutional, international-law and public-sentiment perspective. The two sides of Malta’s bicameral parliamentary system left and returned to the negotiating table a good number of times before a compromise was reached early in 2014. Discussions revolved around the addition of the approved investment and property requirements.
The last remaining political factor to be overcome was the negative sentiment expressed by the European Parliament. Not having any legal jurisdiction on citizenship matters and keen to put this matter behind it, the European Commission met a small Maltese delegation and, within the day, hammered out the terms of Europe’s first EU-approved citizenship-by-investment programme, essentially by introducing the requirement to show a genuine link with Malta for one year.
This period starts running from the first visit of the applicant, who will be issued a one-year residence permit within an impressively short time frame. It is understood that high-net-worth individuals lead very mobile lives and would find it difficult to spend a full year in any one country. Based on the experience of the European Court of Justice, the genuine link test ensures that main and dependant applicants are able to demonstrate a genuine connection with the jurisdiction in terms of their personal, social, philanthropic and commercial activities.