The European Court of Justice has ruled that Malta must terminate its controversial “golden passport” initiative, which grants citizenship to wealthy foreign nationals in exchange for significant financial investment.
The court found that the programme conflicts with European Union law.
Malta has become an increasingly popular destination for South Africans seeking enhanced global mobility, financial security, and a stable living environment. This trend is particularly evident among high-net-worth individuals and business owners exploring residency and citizenship options.
The European Commission first took legal action against Malta in 2022, objecting to the scheme that allows individuals to obtain Maltese – and thus EU – citizenship through investments totalling approximately €1 million. ‘
This citizenship grants holders the right to live and work throughout the EU.
While EU member states retain the right to determine their own naturalisation processes, the court noted that Malta’s approach undermines the mutual trust that forms the foundation of the EU.
It stressed that exchanging citizenship for money reduces the process to a commercial deal, failing to reflect a genuine connection or commitment between the applicant and the country.
The court argued that such programmes weaken solidarity and good faith among EU members, and cannot guarantee the level of trust required within the union.
Malta has maintained that its interpretation of EU law is valid. Although it suspended the scheme for applicants from Russia and Belarus following the invasion of Ukraine, it has continued offering it to other nationalities.
The legal case followed years of discussions between Malta and EU institutions, beginning with an infringement procedure initiated in 2020.
The judges reviewed a 2020 programme under which individuals could obtain Maltese citizenship-and by extension, EU citizenship-by contributing up to €750,000 and, in principle, residing in Malta for at least 12 months.
Successful applicants gained the right to live and work across the European Union.
Despite these efforts, the core structure of the programme remained unchanged, prompting the referral to the EU’s highest court.
Originally introduced through legislation in 2013, Malta’s investor citizenship programme has faced years of scrutiny from anti-corruption watchdogs and civil society organisations.
Critics have warned that the scheme poses risks of money laundering, corruption, and other security threats, while offering limited genuine integration or oversight.
