EU Residency Shift: Impact of Malta Citizenship Ruling
- International Property Alerts
- October 27, 2025
In a landmark decision on April 29, 2025, the European Court of Justice (ECJ) ruled in favor of the European Commission in its legal challenge against Malta’s citizenship-by-investment (CBI) program, known as the Malta Exceptional Investor Naturalisation (MEIN) policy. This ruling, which declared Malta’s program illegal, marks a pivotal moment in the European Union’s approach to citizenship and residency schemes. The decision not only terminates Malta’s “golden passport” scheme but also sends a clear message to other EU member states: citizenship cannot be treated as a commodity. With broader implications for golden visa programs and visa-free access for non-EU countries, this ruling underscores a shift toward stricter regulations across the bloc. For those considering investment-based pathways to EU residency or citizenship, the time to act is now, and exploring opportunities on an international real estate website can help identify the best options in a changing landscape.
Background: Malta’s Golden Passport Program
Malta introduced its first CBI program, the Individual Investor Program, in 2013, becoming the first EU nation to offer citizenship in exchange for significant financial contributions. Reformed in 2020 as the MEIN policy, the program allowed applicants to gain Maltese, and thus EU, citizenship by investing €600,000 to €750,000, purchasing or renting property, and donating to a non-governmental organization, with a residency requirement of 12 to 36 months. In practice, however, investigations revealed that applicants could spend as little as a few weeks in Malta, raising concerns about the program’s integrity.
The European Commission challenged Malta’s program, arguing it violated EU law by granting citizenship without a “genuine link” to the country, undermining the principle of sincere cooperation and the concept of EU citizenship. Malta defended its sovereign right to set citizenship policies, supported by the EU Ombudsman and Advocate General Anthony Collins, who in October 2024 recommended dismissing the Commission’s case, stating no EU law required a “genuine link.”
The ECJ’s Ruling and Its Reasoning
The ECJ’s Grand Chamber rejected Malta’s defense, ruling that the MEIN program breached Articles 20 of the Treaty on the Functioning of the European Union (TFEU) and 4(3) of the Treaty on the European Union (TEU). The court emphasized that while member states retain authority over nationality laws, they must exercise this power in accordance with EU principles. The “transactional” nature of Malta’s program, where citizenship was granted primarily for financial contributions, was deemed incompatible with the “special relationship of solidarity and good faith” required for EU citizenship. The court highlighted that Malta’s minimal residency requirements, sometimes bypassed entirely, failed to establish a meaningful connection between applicants and the nation.
The ruling ordered Malta to terminate the MEIN program and pay all legal costs, effectively closing the EU’s last direct CBI pathway. Malta’s government pledged to comply, stating it was studying the ruling to align its citizenship framework with EU principles, though it noted the program had generated €1.4 billion since 2015, funding social initiatives like housing. Existing passport holders will retain their citizenship, but no new applications will be accepted under the old scheme. For expats and investors, this serves as a reminder of the many things to consider when moving abroad, from shifting immigration laws to long-term residency stability.
Broader Implications for the EU
The Malta ruling is a turning point for EU citizenship and residency policies, reflecting growing concerns about the commodification of nationality and its associated risks, such as money laundering, tax evasion, and security threats. The decision sets a legal precedent that citizenship must be rooted in genuine ties, such as long-term residence, cultural integration, or community involvement, rather than financial transactions. This stance aligns with the EU’s broader push to harmonize immigration policies and safeguard the integrity of Union citizenship, which grants rights like free movement, access to the internal market, and voting in European elections.
Impact on Golden Visa Programs
Unlike CBI programs, golden visa schemes, which offer residency (not citizenship) in exchange for investments, remain legal in countries like Portugal, Greece, Spain, and Malta. However, the ECJ’s emphasis on a “genuine link” has raised scrutiny on these programs. For instance, Portugal’s golden visa allows residency with just seven days of annual presence, potentially leading to citizenship after five years. In response to EU pressure and public concerns about housing affordability, Portugal has proposed extending naturalization timelines and requiring more time in-country. Greece and Spain are also reviewing their programs, with possible reforms to include stricter residency, language proficiency, or integration requirements.
The European Commission has expressed broader concerns about residency policies, recommending that the European Parliament revoke visa-free access for non-EU countries with CBI programs, citing risks of criminal exploitation. The EU and UK have already suspended visa-free travel for several such nations. This suggests golden visa programs may face tighter regulations, with increased due diligence and a shift toward investments that deliver social or economic benefits, such as job creation or rural development.
A Shift in EU Policy
The ruling reflects a broader tension between national sovereignty and EU integration. While member states historically controlled citizenship policies, the ECJ’s decision clarifies that these must align with EU values. This has sparked debate, with critics like former Maltese Prime Minister Joseph Muscat calling the ruling politically motivated, while transparency advocates, including the Daphne Caruana Galizia Foundation, hailed it as a victory against corruption and money laundering. The decision may deter other EU nations from launching similar CBI programs and push existing residency schemes toward stricter criteria.
Malta’s Response and Future Directions
In July 2025, Malta introduced Bill No. 140, the Maltese Citizenship (Amendment) Act, replacing the MEIN program with a merit-based naturalization system. This new framework emphasizes exceptional contributions to Malta or humanity, such as achievements in science, culture, or philanthropy, rather than financial investments. Applicants must demonstrate eight months of residence, language proficiency, and ongoing commitment to the country, with rigorous due diligence by the Community Malta Agency. This shift aligns with the ECJ’s call for meaningful ties and sets a model for other EU nations, reinforcing Malta’s place among the best countries to live in for those seeking both opportunity and community.
Why Act Now?
The Malta ruling signals a tightening of EU residency and citizenship pathways. Golden visa programs, while still operational, are under increasing scrutiny, with potential reforms looming. Countries like Portugal, Greece, and Spain may soon impose stricter requirements, such as longer residency periods or enhanced vetting, making it harder to secure residency or citizenship. Non-EU investors seeking EU access should act swiftly to leverage existing programs before changes take effect. Consulting with reputable immigration advisors, such as those licensed by Malta’s Identity Agency, can provide clarity on current options, or you can contact us directly for guidance tailored to your needs.
FAQ: Understanding the Malta Ruling and EU Residency
1. What was Malta’s citizenship-by-investment program?
Malta’s MEIN program, launched in 2020, allowed non-EU nationals to gain citizenship through investments of €600,000–€750,000, property ownership or rental, and a 12- to 36-month residency period. It was criticized for minimal residency enforcement, granting EU citizenship without strong ties to Malta.
2. Why did the ECJ rule against Malta’s program?
The ECJ ruled that the program violated EU law by treating citizenship as a “commercial transaction,” undermining the principle of sincere cooperation and the integrity of EU citizenship, which requires a genuine link to the granting country.
3. What is a “genuine link” in this context?
A “genuine link” refers to meaningful ties to a country, such as long-term residence, cultural integration, or community involvement, rather than purely financial contributions. The ECJ emphasized this to prevent the commodification of EU citizenship.
4. Are golden visa programs affected by this ruling?
While golden visas (residency-by-investment) remain legal, the ruling has increased scrutiny. Countries like Portugal, Greece, and Spain may introduce stricter residency requirements, longer naturalization timelines, or enhanced due diligence to align with EU principles.
5. Can I still apply for Malta’s golden visa?
Yes, Malta’s residency-by-investment program continues, but it now faces stricter financial and due diligence requirements. Citizenship through investment is no longer available, replaced by a merit-based system.
6. What happens to existing Maltese CBI passport holders?
Those who obtained citizenship through the MEIN program retain their passports, as the ruling does not retroactively revoke them.
7. How does this affect non-EU countries with CBI programs?
The EU may revoke visa-free access for countries offering CBI schemes, as recommended by the European Commission, to prevent security risks like money laundering. This could impact nations like St Kitts and Nevis or Grenada.
8. What are the risks of golden visa and CBI programs?
These programs have been linked to money laundering, tax evasion, and security concerns, as they can attract corrupt actors. The EU aims to mitigate these through stricter regulations and vetting.
9. Should I act now to apply for a golden visa?
Yes, with potential reforms looming, applying sooner ensures access to current, less stringent rules. Consult licensed advisors to navigate programs in Portugal, Greece, or Spain.
10. How can I stay updated on EU residency changes?
Follow reliable sources like the Identity Malta Agency, VisaVerge.com, or Global Citizen Solutions for updates on immigration policies. Legal advisors can also provide tailored guidance.
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