“Golden Passport Schemes”
The European Unionâ€™s executive said on Tuesday it was launching legal action against Cyprus and Malta over their investor citizenship programmes, also known as â€śgolden passportâ€ť schemes. The schemes allow wealthy foreigners to buy citizenship in exchange for an investment of around 1 million euros in Malta and 2 million euros in Cyprus. The European Commission said the decision was taken because the two member states granted nationality â€“ and thereby EU citizenship â€“ without requiring â€śa genuine link with the countryâ€ť, as passport holders were not obliged to reside there. The Commission also sent a letter to Bulgaria raising concerns about its passport-for-sale scheme, it said in a statement.
â€śThere cannot be a weak link in EU efforts to curb corruption and money laundering,â€ť Values and Transparency Commissioner Vera Jourova said.
Maltaâ€™s Finance Minister Edward Scicluna said on Tuesday the country was replacing its current scheme with a new programme that would introduce tighter vetting of applicants, who will have to be residents of the islands for a year before their applications can be considered. The commission has refrained from launching legal actions against EU states that sell residence permits, also known as â€śgolden visa schemesâ€ť, without requiring investors to stay in the country for a meaningful period, despite a European Parliament resolution urging such a move.
In a 2019 report the commission acknowledged golden visa and golden passport schemes posed similar money-laundering and organised crime risks. Portugal, Greece and Bulgaria currently offer golden visa schemes under these lax conditions, a practice of which Latvia was pioneer in Europe. Cyprus said last week it was suspending its citizenship-for-investment programme, ditching a scheme the government had acknowledged was open to abuse after an investigation by Al Jazeera, a media outlet.
By John Chalmers and Francesco Guarascio, Reuters, 20 October 2020