In today’s turbulent world, obtaining a residency or even citizenship in a foreign country by making a qualified investment has gained significant popularity among high-net-worth individuals seeking to broaden their global footprint and secure a stable future for themselves and their families.
Nestled in the heart of the Mediterranean, the European Union (EU) member country Malta offers two prominent programs that cater to this growing demand: the Malta Permanent Residence Programme (MPRP) and the Malta Exceptional Investor Naturalisation (MEIN) policy. The MPRP offers an opportunity for non-EU nationals to gain permanent residency in Malta through a combination of government contributions, property investments, and philanthropic donations. On the other hand, the MEIN policy, often called the ‘Golden Passport’ scheme allows high-net-worth individuals to acquire Maltese residency followed by citizenship through a significant financial investment in the country. These programs provide not only a secure and strategic gateway to the EU but also offer the numerous benefits of Maltese residency and citizenship, including freedom of movement, business opportunities, and a high quality of life.
Furthermore, Malta’s strategic location makes it an ideal hub for business and investment, with easy access to markets in Europe, Africa, and the Middle East. The country boasts a diverse economy, thriving industries in sectors such as finance, technology, and tourism, and a skilled workforce that is well-equipped to support the needs of international investors and businesses.
MALTA’S ‘GOLDEN VISA’ PROGRAM: RESIDENCY BY INVESTMENT
The MPRP, administered under the auspices of the Residence Malta Agency and commonly called the ‘Golden Visa’ program, is designed to attract non-EU nationals by offering them the chance to obtain permanent residency in Malta through investments and contributions. This program particularly appeals to those looking to enjoy the Mediterranean lifestyle while benefiting from the advantages of EU residency. This program, launched in March 2021, is designed to attract foreign investment, stimulate economic growth, and enhance Malta’s international standing as a premier destination for business and leisure.
MPRP Requirements
Applicants to the MPRP must invest in Maltese real estate, with a minimum value of €300,000 for properties located in the South of Malta or on the island of Gozo, and a minimum value of €350,000 for properties elsewhere in the country. Alternatively, a property lease may also qualify, with a minimum annual rent of €10,000 for properties in the South and Gozo, and €12,000 for properties in other parts of Malta.
Along with the property investment, a non-refundable contribution to the Maltese government is required, typically amounting to €28,000 if purchasing property or €58,000 if renting.
An additional donation of €2,000 to a registered Maltese non-governmental organization is mandatory.
Applicants must also cover due diligence and administrative fees, which vary depending on the number of dependents included in the application. They are also required to pay for medical insurance and any necessary legal expenses, such as translations and notarization.
The investment must be maintained for at least five years before it can be sold.
Eligibility
Applicants must be at least 18 years old, non-EU citizens, and in good health. They must pass thorough background checks and provide proof of the legal origins of their investment funds. They must have a net worth of €500,000 or more, with at least €150,000 in financial assets
Family Inclusion
Foreign investors can include their family members as dependents in their MPRP applications, including spouses, children, parents, and grandparents of any age. Additional dependents can be added later.
Residence Permit Validity
Maltese residency granted through the MRVP is valid for life. However, ID cards must be renewed every five years. After five years of continuous residency, permanent residents can apply for Maltese citizenship, subject to meeting additional requirements.
MPRP Benefits
The MPRP successful applicants and their families receive permanent residency status, allowing them to live, work, and study in Malta indefinitely.
Maltese residency allows visa-free travel within the Schengen Area for up to 90 days within any 180 days.
Malta offers a favorable climate, excellent healthcare, and a robust education system, making it an attractive destination for families.
Maltese residents have the option to establish tax residency in Malta if they spend more than 183 days a year in the country.
MALTA’S GOLDEN PASSPORT PROGRAM: CITIZENSHIP BY INVESTMENT
The MEIN policy, commonly known as the ‘Golden Passport’ program, allows investors to acquire Maltese citizenship through significant financial investments and contributions. This program has garnered attention for its potential to grant EU citizenship relatively quickly. This Citizenship by Investment (CBI) program features a clear and straightforward application process, complemented by a rigorous four-tier Due Diligence and vetting procedure. This ensures that only individuals of impeccable standing and reputation are accepted into the program. The government-appointed Community Malta Agency is administering the program.
Requirements
The MEIN policy, introduced in November 2020, allows non-EU citizens to obtain Maltese residency and citizenship in exchange for making investments and donations.
To qualify for the Maltese CBI program, applicants must make a non-refundable contribution to the National Development and Social Fund (NDSF). The required contribution is either €600,000 for citizenship after 36 months of residency, or €750,000 if an applicant wants to obtain citizenship and Maltese passports in 12 months, with an additional €50,000 for each family member.
Applicants are also required to maintain a property in Malta for a minimum of five years. This can involve purchasing a property valued at least €700,000 or renting one with an annual lease of at least EUR 16,000. Subleasing the property is prohibited.
Before applying for citizenship, investors must first secure a Residence Permit and hold it for a minimum of 12 months. This requires physical travel to Malta for biometric submission.
The initial Residence Permit is valid for 36 months and will be extended upon submission of the CBI application. Additionally, applicants must make a non-refundable donation of at least €10,000 to a local NGO and pay a residency fee of €5,000 for the main applicant and €1,000 for each accompanying family member.
Once the Maltese Residency Card is obtained, the investor can submit a citizenship application to the Community Malta Agency. At this stage, applicants must choose between the two NDSF contribution options mentioned above: citizenship after 12 months of residency for €750,000 or after 36 months of residency for €600,000.
Applicants are also required to cover due diligence fees (€15,000 for the main applicant and €10,000 for each dependent over 12 years old) as well as administrative and health insurance fees (€3,000 and €500, respectively, for each person included in the application). Additionally, the state fee for residence cards is €5,000 for the main applicant and €1,000 for each dependent.
Eligibility
To qualify for the Maltese CBI program, applicants must be at least 18 years old with a clean criminal record and good health. They must also have a legal source of income and not appear on any international sanctions list or have been denied a visa by a country with which Malta has a visa-waiver agreement. Applicants with close ties to, or originating from, countries under international sanctions are not eligible for the program.
In the end of the application process, applicants are required to travel to Malta once more to take the Oath of Allegiance.
Family Inclusion
Investors can include family members in their Maltese CBI application. Eligible dependents include a spouse or partner, children under 18 (or under 29 if unmarried and financially dependent on the main applicant), as well as dependent parents or grandparents aged 55 or older.
Benefits
Successful applicants and their family members gain full EU citizenship, which grants them the right to live, work, and study in any EU member state. A Maltese passport provides visa-free or visa-on-arrival access to over 180 countries, including the United States, Canada, the United Kingdom, Japan, the UAE, Singapore, and nearly all other global economic and financial hubs.
Maltese citizenship opens doors to business opportunities across the EU, offering a competitive edge in the global market. The country also allows dual citizenship, adding to its appeal.
The country’s tax system is based on the principle of taxation upon domicile and residence, making it an attractive destination for individuals looking to optimize their tax planning and wealth management strategies. Nevertheless, new citizens are not required to become tax residents. Additionally, the country does not impose taxes on income or assets held outside Malta.
Maltese citizens enjoy access to well-established EU healthcare services and a wide range of educational opportunities throughout the Union. Moreover, citizenship can be passed down to future generations, ensuring the long-term value of the investment.
CONTROVERSIES AND CRITICISM
While Malta’s Golden Visa and Golden Passport programs offer substantial advantages, they have not been without controversy. Critics argue that these programs undermine the integrity of EU citizenship and pose potential security risks.
The European Commission initiated infringement proceedings against Malta at the EU Court of Justice in October 2020, challenging the legality of Malta’s Citizenship by Investment program. The Commission contends that granting citizenship primarily in exchange for financial investment undermines the principles of genuine ties to a member state, which is a cornerstone of EU citizenship. The case is currently underway, with the Court expected to examine whether Malta’s program breaches EU law. While the outcome remains uncertain, legal experts suggest that the Court’s ruling could set a significant precedent for similar programs across the EU, potentially leading to stricter regulations or even the suspension of such schemes. However, legal proceedings can often be lengthy and complex, influenced by various factors such as the complexity of the case, the availability of evidence, and the court’s workload.
In response to international concerns, Malta reformed its CBI program. The Individual Investor Program (IIP) was suspended, and the MEIN policy was introduced with significantly stricter due diligence processes and increased transparency to address these issues. Maltese officials argue that the power to grant citizenship is a matter of national competence, supported by international law and the EU Treaties. They contend that each member state has the right to define its criteria for nationality.
There are also fears that these programs could be exploited by individuals seeking to evade taxes or engage in illicit activities. Malta emphasizes the rigorous due diligence processes and security measures in place for its CBI program, claiming that it effectively screens applicants to prevent individuals with criminal backgrounds or links to terrorism from obtaining citizenship. Indeed, the Maltese CBI program has the highest rejection rate among similar programs globally.
Despite the criticisms, the economic benefits of these programs for Malta are undeniable. The funds generated through these initiatives have been used to support various social and economic projects, including healthcare, education, and infrastructure development. The Maltese government maintains that the revenue from these programs has been crucial in bolstering the country’s economy, especially during challenging periods such as the COVID-19 pandemic.
CONCLUSION
Malta’s Golden Visa and Golden Passport programs offer investors a unique pathway into the European Union, providing the opportunity to enjoy the benefits of EU residency or citizenship. Despite facing criticism and scrutiny, these programs continue to attract high-net-worth individuals seeking a strategic foothold in Europe. As the country navigates the challenges and opportunities presented by these schemes, the island nation remains a compelling destination for those looking to invest in their future within the EU.
The decision of whether to pursue citizenship or permanent residency in Malta depends on individual circumstances and goals. Citizenship offers greater benefits, such as visa-free travel and the right to vote in Maltese elections. However, it also requires a higher level of investment. Permanent residency is a more affordable option but does not provide the same level of benefits as citizenship.
Malta boasts a high quality of life, with a warm Mediterranean climate, beautiful beaches, and a rich cultural heritage. The country is renowned for its friendly people, low crime rate, and excellent infrastructure. Its citizenship and residency programs offer individuals from around the globe the opportunity to invest in a stable and prosperous nation. With its strategic location, competitive tax regime, and high quality of life, Malta is an attractive destination for those seeking alternative residency or citizenship.