Didier Reynders eudebates “golden passport” schemes. EU Passports for sale undermine EU citizenship

For several years now, these programmes have been a source of great concern, notably for this House and the Commission. The Commission has worked hard on this matter, as it is also a European issue with European values at stake. https://www.eudebates.tv/ #eudebates #passports #GoldenVisas #Visas #Cyprus #Malta #Bulgaria

In January 2019, the Commission published its first-ever report on investor citizenship schemes and investor residence schemes operated in the EU. The report clearly spelled out the inherent risks of such schemes, in particular as regards security, money laundering, tax evasion and corruption. Since the beginning of this Commission’s mandate, we have continuously raised this concern with the Member States concerned, urging them to reconsider their decision to operate such schemes.

Since the beginning of my mandate, I have had a constant dialogue with the relevant Member States where I repeatedly highlighted the Commission’s concerns and urged them to reconsider their decision to operate such schemes. Before the pandemic, I met personally with the Ministers of the relevant Member States to discuss investor citizenship schemes. In April, I followed up with letters asking to reconsider the schemes. I also had several calls with the competent Ministers to follow up on their commitments to provide more information on their government’s plan. While both Malta and Cyprus may have the intention to apply some changes to their investor citizenship schemes, they appear to be determined to continue their schemes in some form. We need to convince them not to do that.

EU citizenship is a collection of shared rights that all Member States provide in solidarity. Together, The Member States create the conditions for the enjoyment of EU citizenship. The European Court of Justice has been clear: it is for each Member State to lay down the conditions for the acquisition and loss of nationality. But, as the Court has also ruled, this competence must be exercised having due regard for EU law.

EU law requires Member States to recognise the nationality of another Member State without imposing any other conditions. As a result, the decision to naturalise a person by a Member State is not limited to its own jurisdiction and is not neutral with regard to other Member States. Member States should, therefore, use their prerogatives to grant nationality with due regard for EU law and, in particular, to the principle of sincere cooperation which is laid down in the Treaties. A Member State fails in that obligation when it establishes a scheme which systematically grants naturalisation in the absence of any true link with the state and on the sole basis of a financial investment or, in other words, where passports are for sale.

Over the span of only a couple of years, Cyprus and Malta have naturalised several thousand persons based on their schemes. The price for a European passport in those Member States range between EUR 1 million and EUR 2 million. These investor citizenship schemes undermine the mutual trust of Member States in each other’s naturalisation procedures. This trust is a precondition for the effective enjoyment of EU citizenship rights. By undermining this trust, these schemes threaten the integrity of EU citizenship and its proper functioning and violate the principle of sincere cooperation.

Finally, the Commission has not forgotten about schemes that give foreign investors access to residence permits, also called ‘golden visas’. While golden visa schemes do not raise the same legal issues as schemes that result in the acquisition of EU citizenship, there is often a close interaction between the two types of scheme, as residence can be a prerequisite for the acquisition of nationality. Most of the inherent risks of such schemes, for example regarding security, money laundering and corruption, are the same. Third-country nationals with a valid EU residence permit can travel freely, in particular in the Schengen area. This means that if one Member State does not apply the necessary security checks, other Member States can be negatively affected. Member States should therefore ensure that all the necessary steps are taken to prevent security, corruption, tax evasion and money laundering risks. They must also apply rigorous and transparent criteria to identify and combat crime and corruption.

The Commission has expressed its concern about the risks inherent in residence schemes and about the fact that these risks are not always sufficiently mitigated by the measures taken by Member States. In this context, the Commission continues to closely monitor these schemes and their application, to ensure compliance with EU law, including the need to carry out all obligatory border and security checks, in line with the EU acquis prior to the issuance of any permit.

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