Issue link: https://maltatoday.uberflip.com/i/191652
6 News maltatoday, SUNDAY, 13 OCTOBER 2013 The keys to the E Multimillionaires wanting to evade instability in their home countries can buy an EU passport, reside anywhere across the eurozone, get visa-free travel elsewhere, and enjoy tax rebates by repatriating foreign profits to Malta: it's all possible, MATTHEW VELLA writes, with the Individual Investor Programme that Labour is launching WELCOME the super-rich, brave new travellers of a world where money opens up borders, and doesn't bother about paying tax. Malta's Prime Minister Joseph Muscat is taking its economy out of prehistory. In a few months' time, it will be possible for a South African millionaire to pay €650,000 for a passport, perhaps not even reside permanently in Malta, and repatriate taxes from a foreign company to the island to get an 85% refund on the taxed income. Is Malta joining a league of countries buccaneering their way into short-term wealth? There is an abrasive quality to having to sell off citizenship as a way of making millions. The government says the money will be poured into a ring-fenced posterity fund, but it won't say who will buy Maltese passports. In reality, it is selling EU and border and visa-free travel, something that rich people fleeing instability can certainly need in these taut times. But there is a gross unfairness to the new IIP scheme: many foreign nationals living, working and bringing up their children in Malta often wait for years, perhaps more than a decade, to become naturalised citizens. They form community bonds but are constrained to renew visas and residence permits. Instead of a clear framework and citizenship tests for good-quality members of the community, Malta wants to sell EU passports at €650,000. Scratch that. Bring your wife and two teenage children, and perhaps one of your parents. On average it will work out at €185,000 per person. Just another opportunity To consider the news dispassionately, as the people at Identity Malta and the government want us to, selling an EU passport to multimillionaires is a great way of reaping what they believe is a possible annual €30 million, which will be deposited in a posterity fund dubbed the 'national development fund'. You might think it ironic that, just over 10 years since Labour declared it did not recognise the referendum How the IIP will work How much will it cost? Applicants will pay €650,000, of which €10,000 will be a non-refundable deposit. Their spouses and children under 18 years of age will pay €25,000 each; unmarried children 18 to 25 and parents over 55 years will pay €50,000 each. Other fees will be due diligence fees (€7,500 for the applicant, €5,000 for the spouse, parent and over-18 children, €3,000 for children under 18) and passport fees and bank charges of €500 and €200 per person, respectively. Who is eligible? Applicants and dependants must have a • clean criminal record; • must not be indicted or have appeared before the International Criminal Court; • cannot be or have been wanted by INTERPOL; • must not be an "enemy of the State" or "potential threat" to Malta's independence, national security or reputation; • must not have pending charges or have been found guilty of crimes of terrorism, terrorist funding, crimes against humanity, war crimes, crimes against the European Convention of Human Rights; • cannot have been charged or found guilty of paedophilia, defilement of minors, rape, violent indecent assault, inducing underage persons to prostitution, and abduction; or other offences that disturb the good order of the family. • Applications must come with a medical certificate confirming that applicants and dependents are not suffering "from any contagious disease and that they are otherwise in good health". Are there any loopholes? Yes. Applicants who provide false information, have a criminal record, are subject to a criminal investigation, are a potential national security risk, involved in an activity that could cause disrepute to Malta, or were denied a visa to a country with whom Malta has visa-free travel "shall not be approved for citizenship… unless Identity Malta is satisfied that the applicant is still worthy of being considered for approval due to special circumstances to be demonstrated by the applicant." How to apply? Henley, the concessionaire, markets the scheme to prospective applicants and passes on the application to a due diligence agent approved by Identity Malta. The background check is carried out over 90 days (three months), and then reviewed by Identity Malta for further background checks over 30 days, and issues its recommendation to the minister. A personal interview with the applicant may be carried out. Within five days of approval, the applicant must pay the required fees, and five days later take the oath of allegiance. Can naturalisation be revoked? Yes. Apart from a variety of clauses in Article 14 of the Maltese Citizenship Act, the minister can revoke the 'golden passport' if the applicant has become a threat to national security or is involved in conduct that is seriously prejudicial to Malta's vital interests. Will we know who gets the golden passport? No. Because the proposed legal amendments strike off Article 25 of the Maltese Citizenship Act, which makes the publication of naturalised citizens law; and instead appoints a regulator to oversee the workings of Identity Malta, by publishing an annual report in Parliament, without the names of the applicants. Prime Minister Joseph Muscat claims the IIP will allow the Maltese economy to move out of prehistory Business tycoons needing EU passports Would Mohammed al-Fayed, once the owner of Harrods Department Store, be happy to settle with a Maltese passport if that would grant him the same kind of permanence in his adopted homeland? Selling citizenship can only be a boon to people like al-Fayed, who have viewed the refusal of British citizenship as an affront Mukthar Ablyazov Mohamed Al Fayed to his dignity. On the other hand, people like ousted Thai prime minister Thaksin Shinawatra, who purchased Montenegrin citizenship, used it to prevent police authorities in Bangkok from taking any action against him after he was sentenced in absentia to two years in jail on corruption charges. He had been ousted in 2006 before his sentence was given and now lives mostly in Dubai. Insalubrious characters who would gladly consider Maltese citizenship would be Kazakh oligarchs Rakhat Aliyev and Mukhtar Ablyazov. Aliyev already lives in Malta, having first availed himself of permanent residency under a property-buying scheme, and then gained residence by virtue of the fact that he is married to an Austrian citizen, Elnara Shorazova, herself a naturalised citizen. Aliyev could claim the charges under which he was tried in absentia in Kazakhstan for the murder of two bankers, are politically motivated by the fact that he was stripped of diplomatic immunity and forcibly divorced from his wife by father-in-law Nursultan Nazarbayev, the Kazakh dictator. The same goes for Mukhtar Ablyazov, who was arrested in a spectacular raid on his French villa in July. Ablyazov faces an extradition request from Ukraine but claims Kazakhstan's President Nursultan Nazarbayev is behind a campaign of politically motivated harassment. Rakhat Aliyev Many Amer ican businessmen already living Malta and running large businesses employing many workers, might consider acquiring citizenship especially for tax reasons. Thaksin Shinawatra