By way of background, both Cyprus and Malta joined the EU in 2004. Cyprus began offering citizenship in exchange for investment in 2007 (although significant changes were made in 2013 and 2019), while Malta has been doing so since 2014.
Last week, Al Jazeera, by means of an undercover team member posing as a Chinese investor with a money laundering conviction, managed to film the speaker of the Cypriot parliament together with another Cypriot MP offering to help secure a passport. Both Cypriot MPs have denied any wrongdoing. A day after this became known, Cyprus announced their passport programme would be suspended from 1 November 2020.
Malta last month arrested former Prime Minister Joseph Muscat’s chief of staff as part of an investigation into his alleged corruption associated with the passport route.
The European Commission announced on 20 October 2020 that it would start “infringement proceedings” against Cyprus and Malta over these ‘golden passport’ programmes. Infringement proceedings are brought by the European Commission against a Member State, on the basis of its own investigations, or following a complaint from citizens, businesses or other stakeholders. The European Commissioner, under Article 258 of the Treaty on the Functioning of the European Union, has the option of commencing infringement proceedings against a Member State where it considers that a Member State has breached Community law. For further details on the infringement procedure please see: https://ec.europa.eu/info/law/law-making-process/applying-eu-law/infringement-procedure_en
Cyprus and Malta now have two months to respond to the EU letter, after which the EU could decide to take the case to the European Court of Justice.
This may lead to a review of Cypriot / Maltese passports issued to all under the schemes. Those persons residing in the UK who may be concerned about a review should seek advice as to alternative residence criteria.
The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please don’t hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.