Malta will be launching its own economic passport as a Malta Citizenship Programme. The new Individual Investor Programme will be a good opportunity for investors to contribute to the local Maltese economy whilst at the same time benefiting from a citizenship in Malta, and European Union member state.
Malta Citizenship by Investment will be granted under an amendment to the Maltese Citizenship Act, Chapter 188 of the Laws of Malta, by a bill presented in October 2013. Under the new Malta citizenship by investment programme, defined in the Citizenship bill as the “Individual Investor Programme” (IIP) affluent persons of impeccable standing and repute are able to apply to be naturalised and to receive a Maltese passport on the basis of a contribution to be made to a National Development Fund, to be applied for use in the national interest. Readers should note that this Maltese citizenship programme is still a bill and therefore the details below are indicative. It is expected to become law by publication in October 2013. The first pilot programme is scheduled for November.
Malta Citizenship: Eligibility
To access the Malta Citizenship Program, main applicants must be represented by Authorised Registered Mandataries and are required to contribute €650,000 to an independently managed National Development Fund to be set up by the Government of Malta for the purpose. Spouses and children of applicants for Malta citizenship are required to contribute €25,000 while unmarried children between the ages of 18 and 25 and dependant parents will also be granted citizenship on the basis of a contribution of €50,000 each.
To qualify under the regulations of this programme, a Main Applicant for citizenship must be at least 18 years of age and must meet the follow requirements:
Contribution to the National Development & Social Fund
To access the Maltese citizenship program, main applicants must be represented by Authorised Registered Mandataries and are required to contribute €650,000 to Malta. Of this contribution, 70 per cent will go into a National Development and Social Fund to be set up by the Government of Malta and to be run by a board of trustees on the lines of the Sovereign Wealth Fund in Norway. The rest will go to the consolidated fund.
The CNDSF's scope will be to carry out projects linked to education, innovation, job creation and the implementation of the jobs plus strategy, social projects and projects in the public health sector. The fund will be on the same level as the Central Bank
Spouses and children of applicants for Malta citizenship are required to contribute €25,000 while unmarried children between the ages of 18 and 25 and dependent parents will also be granted citizenship on the basis of a contribution of €50,000 each.
Property Purchase or Rental
Applicants are required to make an investment in property of at least €350,000 or enter a property rental contract for at least €16,000 p.a. both on five-year contracts.
Investment in Bonds/Shares
Applicants are required to invest at least €150,000 in bonds or shares in Malta to be kept for five years. This investments will need to be made in stocks sanctioned by the government as beneficial to the Island. The total investment to be made by applicants for Citizenship by Investment would be of €1.15m.
The “residence requirement” is satisfied on showing a genuine link with the Island of Malta. Approved Agents are able to seek advance written approval from Identity Malta that their clients' proposed links satisfy Identity Malta. Citizenship is granted after 12 months from effective date of commencement of the genuine link with the Maltese Islands. This is not to mean that candidates need to spend 365 days in Malta before citizenship is granted. In practice, all the client needs to do is visit Malta to have their biometrics taken at the beginning of the process and then to take the oath of allegiance at the end.
The definition of residency should be interpreted in the spirit of the residency clause by which the legislator wants applicants to forge links with the island. Acceptable criteria include having local mobile phone, a car, membership of a local club or professional body, as well as any involvement in philanthropy, Persons resident in Malta one year prior to the approval of their IIP application need not satisfy further residence requirements.
'Fit and proper' Test
Applicants must show they are in good standing and repute and will undergo a 'fit and proper' test. The Government of Malta is committed to the highest standard of due diligence to ensure only deserving and reputable applicants are allowed to proceed for the grant of Maltese citizenship. A four-tier due diligence process is carried out directly by the Government that will assess applicants and process applications subject to Governmental approval at various stages. Applicants must demonstrate a clean criminal record, with checks being conducted with the International Criminal Court, INTERPOL and various other authorities and sources. Applicants must provide a police certificate which may be submitted subsequently to the submission of the application but at all times prior to approval.
Applicants must show they do not suffer from a contagious disease.
Malta Citizenship by Investment programme.
Due Diligence Process for Maltese Citizenship Applications
Identity Malta was set up under the relative regulations to handle the review of applications and due diligence of Malta citizenship application files submitted through Authorised Registered Mandataries such as our firm. The Government of Malta is committed to the highest standard of due diligence to ensure only high standing and reputable applicants are allowed to proceed for the grant of Maltese citizenship.
Malta Citizenship Application Process
Applications for Malta Citizenship Programme are to be made to and processed wholly by Identity Malta. Applicants must be represented by an Accredited Person that is a licensed Maltese Authorised Registered Mandatory (ARM). Dr Jean-Philippe Chetcuti (Chetcuti Cauchi Advisors Ltd) holds licence no. IIP 001 and has satisfied the additional requirements imposed by the IIP Regulations over and above the requirements for ARMs under other legislation. The programme imposes more responsibilities on Authorised Registered Mandataries to ensure the highest standards of quality are maintained throughout the application process, for the protection and benefit of applicants and the reputation of the Maltese citizenship by investment programme.
Chetcuti Cauchi’s Citizenship Services
Chetcuti Cauchi enjoys a sterling reputation in the areas of citizenship and residence planning and in the handling of legal and tax matters relevant to the structuring and planning of personal wealth and personal interests and business worldwide. Our Citizenship & Residence Planning team is led by partners Dr Jean-Philippe Chetcuti and Dr Priscilla Mifsud Parker.
Jean-Philippe acts as the firm’s managing partner and serves as the Chairman of STEP, the Society of Trust & Estate Practitioners and on the executive committee of IFSP, the Institute of Financial Services Practitioners. Jean-Philippe co-founded and acts as secretary of the Malta Association of Family Enterprises, which he represents at the European Family Business.
Priscilla is a private clients lawyer specialising in immigration law and in trusts and estates. She is a member of the Maltese Chamber of Advocates and serves as Technical Chair of STEP.