Malta’s prime minister vows to preserve ‘golden passport’ scheme despite ECJ Ban

On 29 April, the European Court of Justice (ECJ) ruled against Malta’s Citizenship by Investment (CBI) program, deeming it incompatible with EU law and ordering its termination. Prime Minister Robert Abela’s government reacted by expressing the intentions to explore alternative forms of the program, aiming to align it with the ECJ’s principles while preserving its economic benefits.

The ECJ declared Malta’s CBI scheme, which sold EU citizenship to wealthy non-EU nationals in exchange for large investments illegal, because it “amounts to the commercialization of the grant of the nationality of a member state and by extension that of Union citizenship,” breaching EU law.

Introduced in 2014 under former Prime Minister Joseph Muscat and amended in 2020, the scheme allowed wealthy foreigners to obtain Maltese citizenship—and thus EU citizenship—after a nominal 12-month residency, often without significant physical presence. Requirements included a €600,000–€750,000 investment, property ownership (€700,000) or rental (€16,000 annually), and a €10,000 charitable donation.

Malta’s citizenship-by-investment (CBI) program allowed up to 1,500 people, capped at 400 per year, to acquire citizenship through financial contributions. The program generated over €1.4 billion, funding the National Development and Social Fund (NDSF) and the Consolidated Fund. The NDSF supported social housing (€60 million), healthcare (€10 million for health centers), sports (€5 million for athletes), and heritage restoration. Additionally, €339 million came from property purchases, €158 million from rentals, €236 million from bonds, and €10 million from philanthropy.

The European Commission initiated the case on 22 March 2023, targeting Malta’s 2020 CBI framework.

Judges said the scheme represented a “commercialisation of the grant of the nationality of a member state.” According to a 2021 investigation, multimillionaires with minimal genuine links to Malta were being granted citizenship, sometimes spending only three weeks in the country.

A cache of emails from the Daphne Caruana Galizia Foundation, known as the Passport Papers revealed that many people claiming to be residents left their Maltese rental properties empty. The Commission referred to the Passport Papers in its arguments to the court, according to the judgement.

On 4 October 2024, Advocate General Anthony Collins recommended dismissing the Commission’s case, arguing that EU law does not mandate a “genuine link” for citizenship and that such decisions are a national prerogative.

However, on 29 April, the Grand Chamber ruled that Malta’s “transactional naturalization procedure” breaches EU law. The court ordered Malta to end the program and pay legal costs, while saying that EU citizenship needs more than just money.

Currently, the Maltese government, while respecting the ruling, is evaluating its legal implications to align the framework with EU principles, said the government in a statement. The country is going to risk hefty fines if it doesn’t comply with the judgement.

“The legislative framework for citizenship by investment in our country was created for the benefit of the Maltese and Gozitan people, and over the years the country has benefited greatly,” wrote in a Facebook Robert Abela, Malta’s Prime Minister.

He criticized domestic opponents who challenged the scheme, accusing them of undermining national prosperity. “There were those who rebelled against our country to gain office and stirred up and did as much damage as they could against this framework, and today they are wringing their hands and boasting that they endangered all this good. The almost billion and a half euros that our country brought in from this program they want to run out of,” further wrote Ablea.

Despite the court’s decision, Abela pledged to develop a new framework “in line with the judgment” that continues to benefit Malta’s economy.

This case highlights tensions between national sovereignty and EU oversight, with Malta defending its citizenship policies against the European Commission’s efforts to safeguard EU citizenship.

Malta maintained that citizenship is a national competence under EU treaties and international law, supported by rigorous vetting processes.

Public reactions vary. Some commend the ECJ for addressing risks like money laundering, while others argue the EU unfairly targets vetted investors.

Abela’s insistence on alternatives reflects a pragmatic but risky strategy. His government’s claim that citizenship is a “national competence” was rejected by the ECJ, yet the push for modified schemes suggests Malta may test the ruling’s boundaries.

Malta had the EU’s last active golden passport scheme, with Cyprus ending its program in 2020 and Bulgaria following in 2022. While some countries still offer “golden visas” that grant residency in exchange for investment, those programs are also facing increasing scrutiny.

Sources: BBC, Euronews, Euractiv, The Guardian, Press Release from the Maltese Government, edited by p.p.p. and g.g.

• golden passports
• Malta

Updated: May 5, 2025 - 19:41