Editorial: Goodbye, golden passports? Not quite

And so begins the next chapter in Malta’s years-long battle with Brussels over its ability to grant citizenship to wealthy investors. Earlier this year, the European Commission won a legal victory when the European Court of Justice declared that Malta’s cash-for-passports scheme was in violation of EU law, because citizenship cannot be the result of a commercial transaction. In other words, money can’t buy you citizenship.

Malta’s government last week unveiled a new citizenship-by-merit programme intended to replace its now outlawed golden passport scheme.

The merit scheme expands on a programme first introduced in 2017 and which allows the government to bestow citizenship on athletes, artists and other individuals who provide “exceptional service” to Malta.

Now, philanthropists and technologists will also be eligible, and “job creation” will be one of the criteria applicants may be judged by. And in case that expanded eligibility list does not cover everything, the new law allows the minister to grant citizenship to anyone, for any reason, if the minister deems that to be in the country’s “exceptional interest”.

The government has made no secret of the fact that it is amending the law through gritted teeth, not out of conviction.

Somewhat ironically, the ECJ judgment has arguably made the scheme even less transparent. Previously, the sticker price was public and non-negotiable.

Now, the situation is less clear. What, exactly, constitutes “exceptional service”?

And how will, say, a philanthropist or entrepreneur deliver it? Unlike payments made under the previous scheme, the contributions applicants of the new scheme make – to local charities or the local economy – will not be listed in euros on the government balance sheet. Nobody, apart from the minister and prime minister, will know on what basis one was made a Maltese citizen.

That is not to say that Malta is the EU’s sole black sheep. Its revised model is clearly based on that of Austria, which quietly operates a citizenship backdoor that allows wealthy investors to apply for an Austrian passport if they make “outstanding” contributions to the country.

Those granted citizenship on that basis do not have to satisfy any other language, residency or integration criteria.

What sets Malta apart from Austria, though, is the scale of its programme. Austria (population nine million) approves a handful of such citizenship applications every year. Malta (population almost 600,000), on the other hand, approved 1,549 golden passport applicants in the past decade – an average of more than 150 a year.

While the ECJ judgment made it clear that citizenship cannot be commodified, the European Commission has yet to challenge Austria’s scheme, or the justification of citizenship based on “exceptional” merit.

The new scheme does away with the role of agents, and that is probably positive. The opposition, which spent years criticising the golden passport scheme, has so far said nothing. Robert Abela called out PN critics who quietly made a mint from the scheme, but conveniently forgot to note that his predecessor’s chief of staff is being investigated for having taken an alleged passport kickback.

More generally, discussion about this issue also glosses over the elephant in the room. While Malta has gone to extreme efforts to make it possible for prominent investors to become citizens, it shows no such interest in rewarding people who genuinely develop a link to the country.

There are countless third-country nationals who have spent years in Malta, working and opening businesses, contributing to the taxman and their communities, and who are denied Maltese citizenship, and at times even deported.

Citizenship is all about identity. Are the ‘outsiders’ who prove they have helped make Malta a better place not worthy of being one of us?