Malta’s controversial Individual Investor Programme (IIP) / Citizenship programme will be replaced in September with a proposed new Residency system which leads to Citizenship.
The European Commission had written to Malta, Bulgaria and Cyprus about their concerns that these schemes had no real obligation for the passport holder to physically reside in the country or have genuine connections to it before obtaining citizenship.
The IIP has proved to be a substantial source of government income. Malta has seen how important the money generated by the scheme was, during Covid-19 pandemic, with projects being paid for by the National Development Fund and Social Fund, where 70% of the IIP proceeds go.
The new programme hopes it will not serve as a cash generating machine but create a genuine link between applicants and Malta.
Under the new system, only individuals who first manage to obtain a Maltese residence permit will be allowed apply for citizenship.
A new agency will be set up to oversee all forms of citizenship, including those obtaining their Maltese passport through the investment programme.They will also handle all citizenship routes, including the traditional ones involving marriage and naturalisation.
The old IIP programme
Currently IIP applicants donate/contribute € 650 000 for their Maltese citizenship for the main applicant and € 25 000 per minor child and spouse and dependant parents pay € 50 000.
Additional to this is the property requirement of buying a property of € 350 000 or pay rental of € 16 000 pa. This has to be retained for 5 years.
Also an investment of € 150 000 into Government approved financial instruments to be maintained for 5 years.
There is also no need to reside on the island.
The new proposed changes
The first requirement will be for the applicant to become resident of Malta.
If the applicant applies for Citizenship after a 1 year residency period, they will need to donate/contribute € 750 000. If the applicant only applies after a 3 year residency period, they would donate/contribute € 600 000.
Under the new proposed system each dependant would pay € 50 000
Additional to this is a property requirement of € 700 000 or pay rental of € 18 000 pa
Also applicants will have to make a philanthropic donation of € 10 000