Maltese Golden Passports
For the uber-wealthy, amassing yachts and supercars to flaunt prosperity might not cut it anymore. Try flexing your bank balance by purchasing the latest status symbol — a Maltese passport, readily available through the Golden Passport program (formally known as the Individual Investor Programme). After paying €600,000, investing in property worth at least €700,000 or renting for €16,000 annually, and making a €10,000 philanthropic donation, one can reap all of the benefits affiliated with the eighth most powerful passport on the globe (coming with all the benefits of EU citizenship). For those unable to spend a whole three years in the beautiful Maltese islands, an increase in payment from €600,000 to €750,000 reduces the necessary time spent in the country to twelve months.
It seems like a win-win. Peter Thiel can add another passport to his collection, and Malta can devote the extra capital to its National Development and Social Fund (NDSF), founded to improve social services such as education and healthcare. These benefits remain unrealized and unverifiable. The Maltese government offers no transparency on the allocation of funds, an issue particularly troubling when taking Malta’s past history of corruption into account. The rare glimpses into spending allocation come through leaked reports, which show that the fees paid by three applicants ended up in the pockets of Keith Schembri, the chief of staff to Joseph Muscat, the former prime minister. The payment of fees in itself was corrupt — the applicants were paying for an expedition and a good word from a government official on their application. Another report showed that the NDSF used money from the program to buy shares of the Lombard Bank, an action that lacks any connection to the purported goal of the NSDF. The European Commission, recognizing this, has repeatedly recommended that Malta terminate the program and launched infringement procedures against Malta.
The EU has also complained about the frequent lack of connection between the country and the buyer. Article 20 of the Treaty on the Functioning of the European Union (TFEU) establishes Union citizenship as a status tied to the nationality of an EU Member State. Citizenship has always been a two-way street, with rights being bestowed upon citizens when they agree to a certain set of duties. The Maltese Golden Passport perverts this longstanding social contract — someone with no intent to live in Malta or partake in its culture can purchase a passport and dilute what it means to be a citizen. In applicant letters of intent, some indicated zero commitment to spending any time in the country; the average commitment for time planning to be spent in the country was sixteen days across two hundred and fifty letters of intent. In fact, applicants asked firms who specialize in Golden Passport how little time in Malta they could get away with spending while still receiving citizenship. The Maltese government is seemingly aware of these issues — it would be hard not to — as in a statement, they insisted that applicants were ‘properly vetted’ but refused to respond to the aforementioned allegations.
Yet this vetting process has not been as proper as the Maltese government purports. Politically exposed persons can easily lie about their status, heightening the chances of corruption or bribery infiltrating the system and the country. In other countries with similar Golden Passport programs, there is a close tie between political elites and organized crime. Since there are no formal repercussions for lying on an application, candidates have a strong incentive to misrepresent their criminal history. The EU has confirmed that the general ease and lack of any consequences for criminals provides no deterrence to shady individuals seeking out EU citizenship in need of an escape. After the invasion of Ukraine, Malta suspended the Golden Passport program for Russian and Belarusian nationals. The only progress has been limited. The vetting process is in need of an overhaul to fix the glaring incentives for elites escaping persecution to seek Malta as a safe haven.
Many of these complaints set the stage for the current suit against Malta. In March of 2023, the European Commission brought Malta to court in Commission v Malta, Case C‑181/23. The EU alleged that Malta’s framework allows applicants to gain citizenship without any ‘genuine connection’ to the country. This genuine connection is essential in a country like Malta. With a population of below 600,000, the population is close-knit and cultural traditions tie communities together; it only takes a small number of illegitimate Golden Passport holders to begin the dilution and commodification of citizenship. The effects have already started to materialize — the Maltese people have taken to the streets in protest, holding signs reading “I am proud that I am Maltese” and “Our Malta is not for sale.”
The concept of citizenship is central to the formation of any community, and the Maltese government should ensure that those entering the country are truly committed to naturalizing themselves in the rich Maltese culture. The government seems to understand the length of time it takes to truly take Malta as one’s home, yet voids the time requirement when money enters the equation. An applicant’s letter of intent should be examined not merely for their financial contribution, but look to other ways they can contribute to society as meaningful citizens. Economic investments are obviously important to a town, but no community thrives without labor, art, writing, gastronomy, or sports. Seeking out applicants with a real interest in Maltese immersion will not only increase their value to the country, but help Maltese-born citizens become more fond of the program through genuine interactions with Golden Passport holders — how can the natural-born citizens support those with Golden Passports when they’ve likely never met?
A country is only as good as its citizens. Malta, not all that glistens is Golden. Reform the Golden Passport system to preserve national integrity and keep your citizens truly citizens.