Wednesday saw yet another blow to Malta’s reputation.

This came in the form of a vote at European Parliament level, where MEPs stressed that ‘citizenship by investment’ (CBI) schemes, under which third country nationals obtain citizenship rights in exchange for a sum of money, undermine the essence of EU citizenship. Parliament describes the practice in place in Malta, Bulgaria and Cyprus as “free riding”, as member states sell what was never intended to become a commodity.

Applications have been accepted even when requirements were not met, MEPs say, and demand that these schemes be phased out due to the risks they pose.

The sale of citizenship, realistically speaking, has always had an expiry date. It was controversial from the very beginning and by continuing to stomp our feet and pretend that it does not affect other EU countries, we have only continued to dig ourselves into a hole, where we are continued to be viewed in a bad light by our closest friends – EU countries.

The MEPs also noted the less severe risks posed by ‘residence by investment’ (RBI) schemes, Parliament asked for EU rules to help tackle money laundering, corruption, and tax evasion, including: stringent background checks (also on applicants’ family members and on sources of funds), mandatory checks against EU databases, and vetting procedures in third countries; reporting obligations for member states, including a “notification and consultation” scheme to allow other member states to object; and requirements for minimum physical residence (for applicants) and active involvement, quality, added value, and contribution to the economy (for their investments).

Labour MEPs stood almost alone voting against the text, with a handful of MEPs from other parties joining them. Not even their colleagues in the Socialists & Democrats EU party, which the PL MEPs form part of, voted against. Indeed, the text passed with 595 votes in favour, to 12 against. 74 MEPs abstained.

There is overwhelming opposition in Europe to the sale of citizenship and the Maltese government might need to cave to pressure on this issue. After all, when selling citizenship we are not just selling Maltese citizenship, but EU-wide citizenship. Given Malta’s track record in terms of combatting financial crime over recent years and our reputation internationally, one could ask, why should other countries trust us with determining who should and shouldn’t be granted citizenship against payment? Why should we sell citizenship to people with no real ties to the country? People who obtain citizenship naturally, by having truly lived in Malta for many years, build bonds and ties to the country, but those who purchase it more than likely don’t.

The Commission now has to prepare a legislative proposal or justify its decision not to do so.

If it does prepare a legislative text, it will cause problems for Malta. The question is, how much political clout do we have to fight this? With our tarnished reputation internationally, can we really afford a fight on this issue should it come to it?