European Court Scraps Malta’s Golden Passport Scheme

European Court Scraps Malta’s Golden Passport Scheme

Why in the News?

In April 2025, the European Court of Justice (ECJ) annulled Malta’s citizenship by investment program, commonly known as the Malta golden passport scheme, deeming it a violation of EU citizenship norms. This decision impacts Malta’s status as one of the easiest countries to get citizenship in Europe through investment. The move followed EU concerns over security risks, commodification of citizenship, and non-compliance with EU values, affecting the issuance of the coveted Malta passport and European Union passport.

EU’s Opposition to Malta’s CBI Programme

  • The European Commission argued that Malta’s scheme commodified EU citizenship, not just national citizenship.
  • The Citizenship by Investment program offered access to free movement, employment, and voting rights across the EU, essentially providing European Union benefits through a Malta citizenship by investment route.
  • It violated Article 4(3) of the Maastricht Treaty — principles of fairness, sincere cooperation, and non-discrimination.
  • President Ursula von der Leyen asserted, “European values are not for sale” in 2020, highlighting concerns about the commodification of citizenship.

Court’s Verdict and Future Outlook

  • ECJ ruled Malta’s scheme undermines EU trust and solidarity, making citizenship transactional.
  • Declared it incompatible with EU treaties and the concept of genuine link in nationality in international law.
  • Malta may still confer national citizenship without EU benefits, but this would reduce the scheme’s appeal as an EU relocation route.
  • The ruling impacts how to get Malta citizenship through investment and affects Malta’s position as one of the easiest countries to get citizenship in Europe.

Understanding Golden Passport and Visa Schemes:

  • Citizenship by Investment (CBI) allows foreigners to gain nationality in exchange for financial investment — termed golden passports. This explains what is golden passport in the context of investment migration.
  • Residency by Investment (RBI) grants residency instead of nationality — termed golden visas.
  • Between 2013–2019, over 1.3 lakh people accessed the EU through such schemes, generating over €20 billion.
  • Major beneficiaries: China, Russia, and West Asia.
  • Raised concerns of money laundering, tax evasion, corruption, and organised crime, flagged by OECD and FATF.
  • The Malta citizenship requirements for these programs typically involved a significant economic contribution, often through real estate investment or a non-refundable contribution to the National Development and Social Fund.

Impact on Malta’s Immigration and Citizenship Programs

  • The ruling affects Malta’s position as a popular destination for investment migration and obtaining an EU citizenship by investment.
  • The Community Malta Agency, responsible for the investor citizenship programme, will need to revise its policies.
  • Foreign investors seeking Malta residency by investment or the Malta golden visa may need to explore alternative options.
  • The decision may influence Malta citizenship requirements for other pathways, potentially affecting the overall naturalization process and the issuance of the Maltese passport.
  • This change in citizenship malta policies will significantly impact malta immigration procedures.

Implications for EU Citizenship and Investment Programs

  • The ruling reinforces the objective of European Union to maintain the integrity of EU citizenship.
  • It may lead to increased scrutiny of similar programs in other EU member states.
  • The decision emphasizes the importance of a genuine link between citizens and their country of nationality.
  • It may impact dual citizenship opportunities for investors seeking an EU passport and visa-free travel within the Schengen Area.
  • The ruling could affect the list of ecr passport allowed countries within the EU.

Considerations for Potential Applicants

  • Those considering Malta citizenship for Indians or other nationalities should be aware of these changes.
  • Alternative paths to Europe citizenship for Indians may need to be explored.
  • Potential applicants should be prepared for more rigorous due diligence processes.
  • Understanding tax consequences and residency requirements becomes crucial for those still pursuing Maltese citizenship.
  • Applicants should be aware that the process may no longer include automatic issuance of an e-ID card or Certificate of Naturalization for EU purposes.

Global Context and Future of Investment Migration

  • The ruling may influence global practices in Citizenship by Investment programs.
  • It highlights the tension between attracting foreign investment and maintaining the integrity of citizenship.
  • Future programs may focus more on long-term residency requirements and genuine connections to the country.
  • The decision underscores the ongoing debate about the nature of citizenship in an era of global mobility and investment.
  • The European Commission is likely to continue monitoring and regulating such programs across EU member states.