Wednesday, 29 June, 2016

The Malta Citizenship by Investment Programme

The Republic of Malta became a member of the European Union (EU) in 2004 and has been part of the Schengen area since 2007.

Malta has a stable political and economic climate, and Maltese banks are ranked among the most secure banks in the world.

The Malta Citizenship by Investment Programme was the first of its kind to get EU approval. The programme grants rights of full citizenship for life, including analogous access to all investment and employment opportunities available throughout the EU to Maltese and EU citizens.

Following the amendment to the Citizenship Act of Malta, and the introduction of new subsidiary legislation titled Individual Investor Programme of the Republic of Malta Regulations, 2014 (the Regulations), the acquisition of Maltese citizenship by naturalisation was extended to reputable individuals wishing to invest in Malta's flourishing economy. Such individuals are granted the opportunity to become naturalised Maltese citizens along with their dependants (both ascendants and descendants) upon fulfilling a number of requirements, mainly relating to investment in Malta.The application process is efficient, with a fully fledged agency (Identity Malta), set up primarily to assist applicants under this programme in the most diligent, professional and timely manner.

The Maltese Government will use contributions made by successful applicants to build the National Development and Social Fund.

To be eligible for Maltese Citizenship, the Main Applicant must be at least 18 years of age, and must meet the requirements set out in the Regulations, mainly the 'Fit and Proper' test detailed hereunder.

The main applicant may also include his/her spouse, children and parents or dependants, under certain conditions,to benefit from this Programme.

The Maltese Government has reserved the right to exclude from the programme individuals who are resident of, or have significant connections to countries where international sanctions are currently enforced or of countries which are excluded by policy decision. In particular, individuals who are nationals of, or are non-nationals but reside, do business, have significant ties in, or connections to the Islamic Republic of Afghanistan, the Islamic Republic of Iran and to the Democratic People's Republic of Korea (North Korea) are excluded from the Malta Individual Investor Programme.

All applicants for Maltese Citizenship must undergo a 'fit and proper' test aimed at assessing their integrity and solvency. For this purpose, applicants must provide a police conduct certificate which is subsequently backed up by internal checks amongst various authorities including the INTERPOL and the International Criminal Court.

The Maltese government is committed to the highest standard of due diligence to safeguard that only individuals who meet this criteria are allowed to proceed for the grant of Maltese citizenship. A four-tier due diligence process is in place, and the government will assess applicants, process and approve applications at the various stages as detailed hereunder:

Good Health

  • Certification that the applicant is free from any contagious disease.

Contribution to the National Development and Social Fund

  • The main applicant is required to make a non-refundable contribution of a minimum of EUR650,000 to Malta.
  • Spouses and children must contribute EUR25,000 each.
  • Unmarried children between 18 and 25 and dependent parents must contribute EUR50,000 each.

 Purchase or Rental of Property

  • An investment in property of at least EUR350,000 or a rental contract for at least EUR 16,000 p.a. is required. Both requisites must have a minimum of five years duration.

Investment

  • Applicants are required to invest at least EUR150,000 in bonds sanctioned by the Maltese government, which need to be held for at least five years.

Status

  • A genuine link with Malta, for a period of 12 months, is part of the "residence requirement". All clients' proposed links must be approved by Identity Malta in writing in advance.
  • Applicants need to commit to some presence in Malta (but not 365 days) before citizenship is granted. Those who have already been resident in Malta for one year prior to a successful applicant for the programme will already satisfy this requirement.

The investment, both in immovable property and in liquid assets, is to be entered into by way of letter of intent and the applicant would then have up to four months from the date of the letter approving his application in principle to conclude such investments. The Contribution to the National Development and Social Fund is due, on the other hand, in part (EUR10,000) upon application as a non-refundable deposit and the remaining balance upon issuance of the Letter of Approval in principle.

Identity Malta will consider all applications on a case by case basis, and applications can be refused on any of the following grounds:

  • Providing false information.
  • Having a criminal record.
  • Potential national security threat.
  • Likely to cause disrepute to Malta.
  • Being previously denied a visa to a country with which Malta has visa-free travel arrangements.

Legitimate grounds for deprivation of citizenship would be if:

  • citizenship was acquired by means of fraud, false representation of the concealment of any material fact or;
  • such citizen has shown himself or herself by act or speech to be disloyal or disaffected towards the President or the Government of Malta or;
  • such citizen had engaged, unlawfully traded or communicated with an enemy or been engaged or associated with any business that was motivated by willingness to assist an enemy in that war.

The basis for taxation under the Maltese system is domicile and residence, rather than citizenship. Persons who take up residence in Malta but keep their domicile outside of Malta are only subject to Malta tax on income and gains arising in Malta, and income arising outside of Malta which is received in Malta.

If you would like more detailed information on the Malta Citizenship by Investment programme, please contact Ugo.

 

Contacts

Commercial Director,
+356 2258 6425