We have said it many times that, sooner or later, the golden passport scheme would have landed Malta into deep trouble.
Only the government seemed oblivious to the shame and embarrassment that such a programme brought to the country. Or else, it knew what was coming but ploughed on, perhaps believing that the “anything goes” mentality it cultivated in Malta would have somehow influenced the way European institutions work.
On Thursday, the European Commission said it will be taking Malta to the European Court of Justice over what it described as a system that was “not compatible” with the principles of the European Union. Infringement procedures had been launched against the country in 2020 and an additional letter of formal notice was sent in 2021. Chances were given for Malta to withdraw the scheme, but government was not forthcoming.
Apart from the times in which government was formally reprimanded for its golden passports initiative, there were a myriad occasions when it was made clear that the European Commission was not happy. When Commission President Ursula von der Leyen visited Malta in September 2021, she had said that it was of the “utmost importance” that the golden passports scheme was stopped. Robert Abela, standing next to her, did not comply.
The scheme, first launched in 2014 when Joseph Muscat was Prime Minister, was tweaked in 2020 under Abela’s premiership, but this did not change matters much. European institutions remained adamantly against the idea and, with the Maltese government steadfastly holding on to its baby, the end result is that Malta has now been taken before the ECJ.
Malta, it must be said, is the only EU country with such a scheme in place. Cyprus and Bulgaria, who had similar initiatives, withdrew them after the Commission had intervened on the matter.
“Granting EU citizenship in return for pre-determined payments or investments without any genuine link to the member state concerned” goes against all that is European, the Commission said. With Malta becoming a European Union member in 2004, a Maltese passport opens the doors to third country nationals to effectively hold a European passport.
Therefore Maltese citizenship gives holders the right to free movement, access to the EU internal market and the right to vote and be elected in European and local elections. Obtaining, or losing, nationality, although regulated by the national law of each member state, “is subject to due respect for EU law”, the Commission insists.
The EC’s patience has run out. If the Commission is to be reprimanded for anything in this particular case, it is the length of time it has taken to take this kind of action. We understand that certain procedures have to be followed, but eight years (and a few more until the matter is resolved, one way or the other), are way too long a time.
The Maltese government has always defended itself, telling the European Commission that the legislative framework behind the scheme was “carefully scrutinised in evaluations on the risks of money laundering the financing of terrorism by several international institutions”. It always said that the due diligence exercise ensured that the people buying their Maltese (and European) citizenship were worthy of the key they were being given.
In Malta, government used its propaganda machine to “sell” the idea that the golden passport scheme was paying for projects that would otherwise not have been done. The Gahans applauded, not seeing beyond what government was feeding them. What they just saw was the money that was being generated, some €800 million between 2014 and 2020. Never mind the humiliation of being in Europe’s black book.
As European Commissioner for Justice Didier Reynders tweeted on Thursday when he announced the Commission’s decision to take Malta before the ECJ, “European values are not for sale”. This is a not-so-subtle indication that the Commission believes that Malta is selling these values for its own profit. In the eyes of the EU, Malta was using its position as an EU member to sell the family jewels.
The suspension of the scheme for Russian and Belarusian nationals, which came earlier this year when Russia invaded Ukraine, was seen as a positive step by the Commission, but it was certainly not enough as the Maltese government has not shown “any intention to end it”.
Now Malta is set to pay the price because of the government’s stubbornness.
This is yet another black spot for Malta’s reputation on the international stage. After having a Prime Minister (Muscat) earning the title of “man of the year” for corruption and organised crime by a consortia of journalists in 2019 and the one-year greylisting of Malta by the Financial Action Task Force, now we have this new chapter which, again, puts Malta in the limelight for the wrong reasons.