Permanent residence in Malta

Koen Royackers writes:
I got your e-mail address from a friend of mine in Malta. I live in the Netherlands and want to move to Malta permanently. I am self-supporting and self-sufficient. The Maltese government now asks Lm245 fees for getting a permanent residence. Can they ask for that kind of money?

From the EU Observer I found out that for EU citizens an application for permanent residence is no longer required.

What do you think of this?

In the same way that a Maltese citizen is entitled to move on a permanent basis to another EU country, it is clear that this right is equally available to other EU citizens who would like to move permanently to Malta. So the reader, who appears to be a Dutch national, does indeed have a right to move to Malta and to reside here on a permanent basis.

However, for financially self-sufficient EU citizens who wish to move to Malta on a permanent basis, it is important to be aware of two different types of permanent residency permits. And one may choose to apply for either of them.

The first is the right to residence on a long-term basis, which is granted by EU law and which I have already explained in some detail in this column last week. In essence, this right entitles an EU citizen who moves to another EU country to apply for a residence permit on a long-term basis in order to live in that country for more than three months.

EU citizens who, like this reader, are financially self-sufficient (and, therefore, will not engage in an economic activity) are also entitled to obtain a residence permit on condition that they provide evidence of their financial self-sufficiency and that they hold a health insurance. This does not mean that they need to prove that they are wealthy people. In general, it should suffice to prove that they are financially independent sufficiently as not to require to rely on the social security system of the country to which they move. In other words that they will not become a financial burden on the country to which they move. Since they have not contributed to the social security system of that country, it is only fair they should not expect to benefit from it.

So whereas EU law gives you the right to reside in another EU country, it does not give you the right to become a financial burden on that country.

Once the residence permit is obtained, the EU citizen may reside legally in that country on a long-term basis. After a period of five years, he is also entitled, under EU law, to a full permanent residence with no strings attached and with no further obligation to go through any further formalities. This is a result of a new EU law which member countries had to implement by April this year.

So, in synthesis, the reader is first entitled to a long-term residence and, subsequently, after having lived here for five years, he is also entitled to a full permanent residence.

The second type of permanent residence consists of an incentive scheme that Malta offers to foreigners, EU and non-EU citizens alike, in order to attract them to set up residence in Malta on a permanent basis. This is known as the permanent residence permit and is regulated by Maltese law, quite separately from EU law.

Any EU and non-EU citizen may apply for a permanent residence in Malta under this scheme and benefit from tax efficient entitlements provided that certain conditions are satisfied. For instance, the applicant must provide evidence of an annual income equivalent to some Lm10,000 arising outside Malta or of a capital equivalent to some Lm150,000. Moreover, the permanent resident is required to remit annually to Malta an income equivalent to Lm6,000 in his/her own respect and a further Lm1,000 in respect of each dependant.

The holder of this permit is also required to either purchase immovable property in Malta valued at not less than Lm50,000 (Lm30,000 in the case of an apartment) or alternatively to lease property for not less than Lm1,800 per annum within 12 months of taking up residence in Malta.

For full details on the permanent residence scheme, the reader should consult the local competent authorities and seek appropriate advice.

Finally, insofar as the application fees are concerned, my understanding is that there is no application fee for the long-term residence granted under EU law. On the other hand, for the permanent residency permit an administrative fee of Lm50 (introduced this year by LN114 of 2006) is charged by the respective Malta diplomatic mission of the country of which the applicant is a national. This fee is charged for processing and transmission of documents.

Readers who would like to raise issues or ask questions can send an e-mail to contact@simonbusuttil.eu or visit www.simonbusuttil.eu