The European Court of Justice has sentenced Malta to granting citizenship to foreign investors, considering that the so -called “gold passports” are not in line with European law. “The acquisition of nationality of the European Union cannot be a product of commercial transaction,” the European Union’s court said in its conviction for Malta published on Tuesday. The European Commission had appealed to the Golden Passports in September 2022. Malta allowed citizenship by foreign investors, since they had at least 600,000 euros for citizenship in itself plus another 700,000 euros for the purchase of property in the country.

An extremely interesting aspect of the case is that in October 2024, the Attorney General of the European Court of Justice, Michael Collins, had requested that the Commission’s appeal be rejected, “justifying” the Maltese government to his recommendation. As a rule, in fact about 80% of the cases, Luxembourg judges follow the Attorney General’s suggestion. However, in this case this did not happen.

“The state responsible” but …

According to the judges, “although the determination of the conditions for granting and loss of citizenship falls within the jurisdiction of the Member States” this jurisdiction must be exercised in such a way as to comply with the law of the Union. Citizenship is based on a “relationship of solidarity, faith and reciprocity of rights and obligations between the Member State and its citizens” and this principle is violated when citizenship is granted in return for “investment or payments”. It is a “commercialization” of citizen status, which is not in line with the perception of union citizenship, as defined in the circumstances, the court said in his verdict.

In a first assessment, we would say that this decision once again contradicts the perception of some devotees of “national sovereignty” that a Member State cannot be legally controlled on the basis of Community law on issues that fall under its sole competence. After all, in 2019, shortly before the Commission launched the legal process against Malta, Justice Commissioner Vera Yurova had emphasized that “when a member state sells its nationality, it also sells European citizenship, that is, it does not sell it.”

The case of Cyprus

In March 2022, the European Parliament, in its resolution, urged the Commission to completely ban “gold passports” throughout the EU by 2025. At that time Malta, Bulgaria and Cyprus were given. However, the Cyprus government had already ended the program of “Golden Passports” since November 2020, however, stating that the “examination” of applications had been submitted until then.

A report by the German Economic Inspection Handelsblatt in July 2022 argued that at the end of 2020 1,417 applications were pending in Cyprus and only 390 “gold passports” were granted in 2021.

However, speaking to DW in May 2023, the President of the Republic of Cyprus Nikos Christodoulides stressed that “this issue is over, there is no question of continuing the program” and this “was something that had to be done”.

A different case from the Citizenship by Investment is considered to be the “Golden Visa”, which is now granted by a few EU member states, including Greece. The “golden visa” has also sparked reactions at the political level, but so far there is no question of banning or appealing to the European Court of Justice by the Commission.