Issue link: https://maltatoday.uberflip.com/i/248536
16 News maltatoday, SUNDAY, 26 JANUARY 2014 Commodification of citizenship could put Malta in a tight corner Two experts in EU and comparative law have an opposing view of the EC's opposition to Malta's sale of passports: one argues that it cannot intervene in this national affair, the other claims trading passports could make this an experimental legal case for the European Court of Justice MIRIAM DALLI DOES the European Commission have a solid case against Malta in bringing it to book over the sale of passports for €650,000? Lawyer Mark Attard Montalto, a European law specialist, argues that it is difficult for the EC to justifiably initiate infringement proceedings and seek a judgement that finds Malta has violated the Treaty of the European Union (TEU) On the other hand, Ivan Sammut, a resident academic in the Department of European and Comparative Law at the Faculty of Laws of the University of Malta, argues the Commission has "a right" under Article 4(3) of the Treaty – which cites the principle of sincere cooperation between member states – to intervene. Both lawyers agree that citizenship is a matter of national competence, but Sammut insists changes to citizenship law must be done in the light of EU law and international law. European citizenship was established by the Maastricht Treaty in 1992, giving nationals of an EU member state European citizenship, with all its pursuant rights and obligations. "The Commission may contend that Malta's actions, by way of introducing the Individual Investor Programme in its domestic legislation, may be violating EU laws and regulations. It will say member states should act loyally and respectfully towards other member states and to the Union, in accordance to Article 4(3) of the TFEU," Attard Montalto says. "So how is Malta jeopardizing the EU... considering that it has a capping of 1,800 successful candidates?" Attard Montalto claims that since the EU treaties were established to create the internal market – and not matters falling within the individual responsibility of its members – the IIP goes beyond their scope. Again, he points to the capping of the IIP: Prime Minister Joseph Muscat is confident that a "way forward" can be discussed with the European Commission "The effects of such domestic legislation on the internal market can only be extremely small, if any at all, considering the minimal number of potentially successful candidates. Perspective is critical here; proportionality is a fundamental EU principle," he says. Indeed, the TEU's Article 4(1) makes it clear that competences not conferred upon the Union in the Treaties, remain with the member states. Attard Montalto says this was amply proven in the Grzelcyzk case of 2001 by the European Court of Justice. "It's likely that the Commission will want to verify and establish that the successful IIP candidates will be persons having a direct link to Malta and to Malta's interests. It's fundamental that the government does not project this scheme as some crude money-making scheme, but rather as a programme to attract significant investment to Malta, for the furtherance of this country's economic, social and cultural objectives," he says. But Ivan Sammut takes a different perspective to the entire affair, saying that while citizenship remains the sole competence of member states, Malta also has a duty to exercise this sole competence with EU law and international law in mind. "The IIP is de facto a very loose form of granting naturalisation which falls well below the normal international norms [so] the Commission has a duty to ensure this does not constitute a measure which could jeopardize the attainment of the Union's objectives," Sammut argues. International law, he says, requires states to respect "generally accepted concepts" – such as naturalized citizens having a genuine link with a state. But Sammut says the IIP legal notice falls short of the requirements of international naturalisation rules. EU Justice Commissioner Viviane Reding: "You cannot put a price tag on EU citizenship" "The link with Malta provided in the IIP is well below the normal international standard. This could not only open the door for abuse by third country nationals seeking EU rights, but by member states who would be using the obligations of other member states to 'trade' in citizenships," he says. An example could be nonEU nationals using Malta as a gateway to claim rights in the UK, or in Sweden. So since the IIP grants access to 28 other countries, the Commission has "a right" to intervene, Sammut says, at least by virtue of the principle of "sincere cooperation" – Article 4(3) of the TEU. And even though a potential case before the European Court of Justice – which would be the final step in an infringement proceeding against Malta – would be unique, Sammut says this might give the Court the opportunity for "another strong landmark case, including possibly new concepts." Sammut cites two decisions, the Rottman and Nottebohm cases in the European Court of Justice and the International Court of Justice respectively, whose outcome indicates that "the Commission has a very strong case and Malta has a very weak case." In Rottman (2008), which Commission sources say is the potential basis for action against Malta, an Austrian national facing criminal proceedings successfully obtained German naturalisation in 1998 without informing his new country that he was facing criminal steps. Germany decided to withdraw his citizenship because he obtained it by deception, but Rottman had already had to forcibly renounce Austrian nationality because the country does not accept dual citizenship. International law prohibits states from rendering an individual stateless, so Rottman took Germany to court. On its part, the European Commission supported arguments by Germany and Austria that the matter was an internal one. On its part, the ECJ had to determine whether Germany could render Rottman stateless; and whether Austria's law preventing Rottman from resuming his former citizenship was proportional. The ECJ ruled that Germany could withdraw citizenship obtained by deception, and suggested that it should be the Austrian courts – in light of the "principle of proportionality" – to afford Rottman a reasonable period of time to recover his original nationality. Sammut says the Rottman case makes it clear that due regard has to be given to EU law and to the interest of the EU as a whole. "The Court has jurisdiction to rule on such matters of citizenship because EU and national citizenship are now bundled together. Member states have an obligation to exercise their competence with due regard to EU law." Sammut even says that international law lays down "some generally accepted concepts" which states are required to respect: a genuine link with a state, or residence in the state of naturalisation. "If the link is weak and is just done for economic or political purpose, it is not impossible for other states to refuse to recognise such naturalisation," he says, citing the Nottebohm case of 1955 before the International Court of Justice. Here the ICJ found that Guatemala had the right to refuse to recognize the naturalisation of a German citizen by Liechtenstein, because Nottebohm had simply acquired it for political protection, and had no genuine links with the state. Here the ICJ referred to other links, such as family ties, a public life and other sense of belonging to the country. "Economic or political protection were not deemed as sufficient enough links… Citizenship is a privilege of a genuine connection and not a right," Sammut says. Sammut even suggests that the latest legal notice on the IIP – LN450/2013 – allows applicants to obtain Maltese citizenship without first purchasing a €350,000 property (or rent at €16,000 annually) and also invest €150,000 in bonds. In fact, Article 10 of the legal notice says the minister can withdraw citizenship "if the applicant granted citizenship fails to comply with any requirement to lease, purchase and retain property in Malta or to make and retain investments in Malta." Surmising that the wording here implies that an applicant is first granted citizenship against €650,000 – before buying property and bonds – Sammut claims that one need not fulfill all the conditions before the citizenship is granted. "Naturalisation here is more like a tradable commodity and the genuine links required by the International Court of Justice are absent completely. Hence, other countries are free not to recognise this kind of naturalisation if the issue arises." Taking it a step further, Sammut argues that in Nottebohm the link was just "political and legal protection". Malta's link "is even weaker as it for all intents and purposes it is a commodity." mdalli@mediatoday.com.mt