Minister: Rate of applications for citizenship scheme 'satisfactory' - Opposition says it will publish names of those granted citizenship

An Opposition motion to repeal the regulations governing the Individual Investor Programme (IIP), better known as the citizenship scheme, was defeated in Parliament this evening with 39 votes against and 30 in favour.

During the debate, Home Affairs Minister Manuel Mallia said the rate of applications for the scheme was satisfactory. He called on the Opposition to withdraw the motion and share with the government the success of this scheme. 

Opposition leader Simon Busuttil said the Opposition would use its position in the monitoring committee to oversee the scheme and it was calling on the chairman to call regular meetings. If the government did not publish the names of those who acquired citizenship, the Opposition would.

The Opposition, he said, would insist that applicants must live in Malta for an effective 12 months before acquiring citizenship. Otherwise such citizenship could be withdrawn.

The Opposition would also continue to insist, even within the Public Accounts Committee, that the contract with Henley and Partners, operators of this scheme, must be published and examined.

The motion was moved by Opposition Home Affairs spokesman Jason Azzopardi. It said that the regulations did not make specific reference to the clause in the agreement with the EU that applicants for citizenship must live in Malta 'effectively' for one year. Nor did the regulations specify that dependants of applicants, who will also receive Maltese passports, had to similarly live here for an effective period of one year.

Furthermore, the regulations empowered Henley and Partners to receive full payment for applications and to retain such funds for the duration of the due diligence period, which could be up to two years.

Dr Azzopardi said the regulations empowered the Minister of Home Affairs to grant citizenship to persons who had a criminal record or were a threat to national security.

The regulations did not specify that the list of persons who were granted a passport under this scheme should be published separately from those granted citizenship through marriage or naturalisation.

The debate was opened by the Deputy Leader of the Opposition, Mario de Marco, who said that the principle in the Opposition's argument was that citizenship should not be for sale. 

The Opposition was proactive and had presented various proposals. Initially, none were accepted by the government, he said.

But the people realised that the scheme would wrongly give the impression overseas that this was a bankrupt country desperate for funds. The people realised the principle behind the concept of citizenship and therefore also objected to the scheme.

The European Parliament had united in its opposition to the scheme, and newspapers all around the world had ridiculed it. The European Commission too started voicing its objections, and the government eventually changed its mind, four times. 

The Opposition insisted on the lifting of the secrecy clause and had also insisted that there should be a genuine link between applicants for citizenship and the country. Citizenship should not come about simply through the signing of a cheque.

It was unfortunate that it took so much for the government to see the logic of the Opposition's arguments.

Dr de Marco said he personally did not feel that residence of one year was enough to justify residence, but the Opposition was prepared to respect what the government had agreed with the European Commission, including an 'effective' one year residence. But it was insisting that what was agreed with the Commission should be respected by the government itself, including the 'effective' residence of one year.

Alas, the regulations left open the possibility of different interpretations to 'residence'.

Furthermore, the residence requirement was being imposed only on the applicant for citizenship and not his dependants, even though they too would also assume Maltese citizenship. Once Parliamentary Secretary Owen Bonnici had publicly said the requirement applied also to the dependants, the regulations should be amended accordingly, Dr de Marco said.


Parliamentary Secretary Owen Bonnici said the purpose of the Individual Investor Programme was to create, for the first time, a €1 billion fund for projects which would improve the people's quality of life.

He insisted that the regulations respected the agreement reached with the European Commission.

The strength of the programme lay in the fact that it was the only one which had been endorsed by the European Commission. The agreement was reached because the Commission saw in the Maltese government a genuine partner that wanted to follow the programme in a spirit of sincere cooperation.

In terms of the agreement, applicants had to buy a residence in Malta and prove they had resided here for a year. As a result of this agreement, the EU agreed there should be no capping on the number of applicants to the scheme. The government, however, had no intention of exceeding the original limit it imposed on itself of 1,800 main applicants.

The changes made in virtue of the agreement with the EU were such that the scheme remained competitive. The PN proposals would have made the programme uncompetitive since it had wanted five years of residence and a much higher level of investment.

Clearly, with the agreement having been endorsed by everyone except the PN, it now was the time to move forward and not to create further problems, Dr Bonnici said.

Dr Bonnici asked what the opposition would do after this debate. Would it continue to send its cameramen to hound applicants at the airport? Would it continue to obstruct the programme in Malta and abroad? Would it continue to say it would withdraw citizenship, when this was not legally possible?

Dr Bonnici said the opposition had been far from constructive since November. It had lost credibility as a result, but it should now help to make this programme a success, because it would be the people as a whole who would benefit. The motion should therefore be withdrawn.


Francis Zammit Dimech said it was the Opposition which was constructive and the government which had been stubborn. Last November the government MPs voted for a citizenship scheme which would have been secret and provided for no genuine link between applicants and the country. The scheme was improved only thanks to the Opposition and the concerns raised in the EU.

The government only sought and eventually achieved its agreement with the EU after the issues pointed out by the Opposition, the rejection of the European Parliament and the untold harm caused to Malta's reputation. All that would have been avoided had the government heeded the opposition in the first place last November.

The agreement reached with the EU was substantially different from what the government proposed and pushed through Parliament in November.

Dr Bonnici had claimed that no one could agree with Simon Busuttil. Yet this citizenship scheme, now in Version Five, showed how the government could not even agree with itself, Dr Zammit Dimech said.


Parliamentary Secretary Edward Zammit Lewis said the government was humble enough to say that the present scheme could have been drafted in its present form in November. Things could have been done differently.

But there was no denying that the Opposition had changed its position frequently and was not coherent in its criticism.

The government had been wise enough to note the criticism by the European Parliament and others and held talks with the most important institution, the European Commission, achieving agreement within a day on what had now become the only EU-endorsed citizenship scheme.

Dr Zammit Lewis said the European Commission had not sought effective one year residence, but effective 'residence status.' The definition could be found in the The Income Tax Act.

Referring to points of the Opposition's motion, Dr Zammit Lewis said the government's agency, Identity Malta, and not Henley and Partners, would have total, effective control over the Individual Investor Programme.

It was not true that Henley and Partners would be paid before applicants were sworn in as Maltese citizens.

The local regulations were more detailed than in any other country, Dr Zammit Lewis said. There was nothing strange in the minister being granted discretion, indeed that discretion existed before in the Citizenship Act.

As for the publication of the names of the new citizens, Dr Zammit Lewis said the Opposition was demanding things it did not seek before. 

He could not understand the reasons for these demands, he said, but the Opposition leader was now isolated from the European Union and the local social partners.


Dr Jason Azzopardi said no one could understand how the government had assigned a private company, Henley and Partners, to exclusively administer the scheme and earn millions of euro. One wondered whether there was some obligation. If the scheme was to be administered by Identity Malta, the regulations should say so. If there was no exclusivity, the rules should also say so.

As they were, the regulations gave preferred status to Henley over possible competitors and even over Identity Malta. The obvious advantage to Henley could be seen in every stage of the process and the company would even be informed of applications made to competitors.

It was scandalous that, potentially millions of euro deposited by applicants and due to the government could be held by Henley while applications for citizenship were processed. This did not even happen in the Caribbean countries. Why didn't the government provide for Escrow accounts? What guarantee was there that Henley would not fail? What if the funds were not remitted to the government? Wouldn't the government still be liable for them?

Nor could one understand how the minister had the discretion to allow citizenship to applicants who had a criminal record or were a threat to national security. This was unprecedented and could even open the door for corruption.

Dr Azzopardi criticised the fact that new citizens were not even being required to be sworn in in Malta.

He also pointed out that the government had still not published the regulations governing the fund which would utilise the funds from the citizenship scheme. Had the fund been set up? What had become of the Special Purpose Vehicle which was to have been set up?


Foreign Minister George Vella said the PN was stretching this issue more than chewing gum solely for partisan reasons. It was a disgrace that the PN had adopted the practices of old by speaking against the country abroad.

The controls which Malta was imposing on its citizenship scheme were more stringent than other countries, he said, but the Opposition was failing to recognise this.

If the Opposition's concerns about the acquisition of European citizenship were genuine, would it now object to the scheme in Cyprus, or a new scheme in Spain targeted at granting citizenship to some 350,000 Jews whose ancestors were exiled from the country in the past? Dr Vella stressed  he had nothing against the Jews or Cyprus, but their schemes had far fewer controls than Malta's.


Home Affairs Minister Manuel Mallia said the people would judge this programme now and in the future when they benefited from the fund which this programme would yield. The fund would be used for innovation, hospitals, schools and other measures.

He said he was pleased to report that the flow of applications for the programme to the scheme was very satisfactory.

The Opposition, he said, had not wanted this programme, at all costs, and in talks with the government consistently moved the goalposts.

It was about time, Dr Mallia said, that the PN stopped scaremongering about everything. The tactic had not worked before the election and was not working now.

The Opposition should withdraw its motion and join the government in the success which the programme would have. Otherwise they would go down in history as having sought to destroy it.

Dr Mallia insisted that the programme would be implemented in a professional manner, with the regulator being the former head of the civil service under the PN government. The PN should not try to scare the people about criminals being allowed to become citizens since the law listed the sort of crimes which precluded applicants from seeking citizenship here.

Nor was it true that Henley would retain huge sums of money due to the government. The funds would be remitted to Identity Malta, which would retain overall control over the whole citizenship programme.

Dr Mallia again urged the Opposition to reconsider and to withdraw the motion.


Opposition leader Simon Busuttil said the Opposition had given a voice to all those who felt that citizenship should not be sold.

The way how the government had handled this issue was an example of how things should not be done. Even the latest version of the scheme did not loyally reflect the agreement between the government and the European Commission. But this 'government that listens' was, yet again, ignoring the Opposition. That was why this motion had been moved.

While the Opposition remained of the view that citizenship should not be sold, it had proposed measures to change the scheme into an investment scheme. A raft of amendments were proposed way back in November, and all were turned down by the government.

A comedy of errors then followed right from the day when the President signed the law.

The government accepted to lift the citizenship clause, but still it was dishonest, lumping those who bought citizenship under this scheme with those who got citizenship through naturalisation.

Then the government introduced an element of investment. It was not up to what the Opposition wanted, but at least the change was made.

The opposition still insisted there had to be a genuine link between applicants for citizenship and the country. The opposition had wanted a substantial period of residence, perhaps five years. The government ignored the appeal. Were it for the government, one would not even have needed to live in Malta for a day before acquiring citizenship. The opposition had no alternative but to continue to press, even going to the European Parliament.

It was the EP which was the voice of the people that brought about such a genuine link between applicants and the country. The European Parliament was not something alien to Malta. It was taghna llkoll, Dr Busuttil said.

The Opposition now expected what was agreed with the EU, including the 12 months of effective residence, should be respected.

Dr Busuttil said the harm caused to Malta's reputation throughout this saga stemmed from the government's own idea to sell citizenship. What the opposition had done was to criticise something which was harmful to the country. So how could it be accused of working against the country's interests?

The opposition had worked in the defence of Malta's reputation, and not the other way around.

The opposition had been effective and managed to force an obstinate government to make successive changes.

The Opposition was all for the government attracting funds, but that should be done in a proper way. One could not attract funds from one source, while losing it from another as Malta's reputation went downhill. And attracting funds, in itself, did not make this scheme a good one.

Dr Busuttil said the Opposition would use its position in the monitoring committee to oversee this scheme. It was calling on the chairman to call regular meetings. If the government did not publish the names of those who acquired citizenship, the Opposition would.

The Opposition would insist that applicants must live in Malta for an effective 12 months before acquiring citizenship. Otherwise such citizenship could be withdrawn.

The Opposition would continue to insist , even within the Public Accounts Committee, that the contract with Henley must be published and examined, Dr Busuttil concluded.



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