European Court of Justice delivers blow to Maltas Citizenship-for-Sale Program

May 01 2025 07:37:25 by PCLMedia

In a landmark ruling that could reshape how EU citizenship is granted across the bloc, the European Court of Justice (ECJ) on Thursday declared that Malta's controversial "golden passport" scheme breaches European Union law, dealing a serious blow to the island nation’s lucrative citizenship-by-investment program.

The court found that by offering EU passports to wealthy foreigners in exchange for minimal residence and investment, Malta undermined the concept of European citizenship, which is intended to reflect a genuine link between the citizen and the Union, not a transactional relationship.

Citizenship, Not a Commodity

At the heart of the ruling is the principle that EU citizenship is more than a legal status — it is a bond with rights, duties, and shared values. The court emphasized that granting citizenship must be based on a “genuine connection” between the applicant and the issuing state, not just financial contributions.

Malta’s program, launched in 2014 and marketed to ultra-rich individuals seeking visa-free travel and European residency, allowed applicants to acquire Maltese — and, thereby EU — EU-citizenship after only 12 months of nominal residence, often without physically living in the country.

“The conferral of nationality — and with it, EU citizenship — cannot be reduced to a commercial transaction,” the court wrote in its judgment. “It must reflect a genuine and lasting link between the individual and the Member State.”

Brussels’ Longstanding Opposition

The ruling comes after years of pressure from the European Commission, which launched legal proceedings against Malta in 2020, accusing it of violating the spirit and letter of EU law. The scheme has also faced criticism from anti-corruption watchdogs, who argue it opens the door to money laundering, tax evasion, and security risks.

European Commissioner for Justice Didier Reynders welcomed the judgment, calling it a “strong affirmation that EU values are not for sale.”

Economic vs. Ethical Concerns

Malta has argued that the program brings substantial economic benefits, helping fund national development and attract foreign investment. The government has defended its scheme as rigorous, insisting applicants undergo thorough background checks.

However, critics say the vetting process is opaque and susceptible to abuse. Leaked documents and investigative reports have revealed that some passport buyers had ties to authoritarian regimes, raising questions about the integrity of the process.

Following the ruling, pressure is expected to mount on Malta to fully dismantle the scheme. Though the country paused new applications from Russian and Belarusian nationals after the invasion of Ukraine, it has continued to process other applications under modified terms.

Wider Implications Across Europe

The decision is likely to reverberate beyond Malta. While Cyprus and Bulgaria have already rolled back similar programs under EU scrutiny, other nations with investor residence schemes — sometimes viewed as precursors to golden passports — may now face renewed calls for reform.

Legal experts say the ECJ has drawn a clear red line: citizenship cannot be commodified. This sets a precedent that strengthens the EU’s legal arsenal in preserving the meaning and integrity of European identity.

For Malta, the financial cost may be steep. But for the European Union, the ruling signals a broader commitment to principles over profit. You are looking forward moving to Malta? Moving to Malta as an expat involves several key considerations regarding residency, healthcare, and work opportunities.