Maltese Citizenship: Genuine Links Requirement in European Law - Advocate General, Court of Justice EU

Key Legal Issues

• The legal precedent on Genuine Links requirement established by the International Court of Justice and mirrored by jurisprudence of the Court of Justice of the EU (CJEU). A pre-requisite for the validity of citizenship granted according to Member State Rules or for recognition of Maltese by other countries?
• The actual requirement of 'genuine links' ingrained in Malta's 3- or 1-year residence requirement to qualify for the privilege of naturalisation as a Maltese Citizen.
• The Implications of this strong signal from the European Court on citizenship programmes in Europe and beyond.
• Precautions new Investor Citizens should take to ensure their citizenship is not disregarded by other countries who may apply a substance test.

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Commission's Complaint: MS Nationality grants EU rights but requires Genuine Links

• The Commission highlights that the European Union is based on the integration of European States with shared aspirations and values, uniting the peoples of each Member State.
• EU citizenship strengthens ties between Member State nationals and the EU, fostering solidarity and deeper integration among the different peoples of Europe, forming a single polity within the EU.
• EU citizenship includes rights such as moving to and residing in another Member State, equal treatment to nationals of that Member State, and voting and standing as a candidate in municipal and European Parliament elections. These rights express solidarity and mutual trust between Member States.
• The automatic and unconditional extension of certain rights to nationals of all Member States aligns with the principle of mutual trust.
• This principle is based on the understanding that nationality reflects a genuine link between a State and its nationals.
• The special relationship of solidarity and good faith between a State and its nationals, along with the reciprocity of rights and duties, forms the foundation of nationality.
• An investor citizenship scheme that grants nationality in exchange for pre-determined payments without requiring a genuine link between the State and individuals undermines the essence and integrity of EU citizenship and mutual trust.
• Such a scheme is incompatible with the concept of EU citizenship as provided in Article 20 TFEU and the principle of sincere cooperation in Article 4(3) TEU.
• The establishment and operation of these schemes, even if seen as financially beneficial for a Member State, are detrimental to the European Union’s objectives.
• Commission's Complaint 3: An Unlawful Investor Citizenship Scheme as Malta does not verify Genuine Links.
• The 2020 citizenship scheme meets the criteria of an unlawful investor citizenship scheme as it allows the systematic grant of nationality in exchange for substantial pre-determined sums without requiring a genuine link with Malta.
• The Commission rejects Malta's claim of granting citizenship based on 'prospective links' and emphasizes that EU citizenship benefits take effect immediately upon acquisition. Promotional materials suggest that naturalized citizens might reside in other Member States.
• The Nottebohm judgment supports the requirement of a genuine link.
• The Commission argues that the due-diligence process under the 2020 citizenship scheme assesses security and reputational risk but does not ascertain a genuine link between the applicant and Malta.

Malta's Response on Genuine Links

• Acknowledges that the existence of a ‘prior genuine link’ is a legitimate basis upon which States may decide to recognize an individual’s ties with their political community.
• Nonetheless a matter for the democratic institutions of each Member State to choose that option by way of political and sovereign decisions, often based on considerations of fairness and moral justice.
• A Member State thus enjoys a broad discretion in deciding what links are sufficient to justify inviting an individual to become a member of its body politic.
• The Treaties and their travaux préparatoires do not oblige Member States to require a person to have a ‘prior genuine link’.
• That requirement does not exist under international law, and that the Nottebohm judgment, upon which the Commission relies, has been the subject of extensive and well-justified criticism.
• The Commission’s single plea oversimplifies the Court’s case-law by seeking to equate the withdrawal of nationality with its acquisition.
• Withdrawal of Member State nationality from an individual deprives of EU citizenship and the body of rights entailed, so deprivation of EU citizenship should be careful and strict.
• By contrast, acquisition expands not diminishes the rights and obligations of a person, so requires a different standard of review.
• This misreading leads the Commission to call for a disproportionate outreach of EU scrutiny over a field of national competence.
• The Commission’s portrayal of the 2020 citizenship scheme as an ‘automatic and unconditional’ access route to Maltese nationality, providing for the ‘systematic granting of nationality in exchange for pre-determined payments’, in the ‘purely budgetary interests’ of the Republic of Malta, is an oversimplification.
• Malta places significant weight on the impact of each application on ‘security, reputation, systemic effects, compliance and other criteria’.
• A rate of refusal of approximately one third of all admissible applications is sufficient proof of the absence of any automaticity.
• Applicants must give long-term commitments and remain subject to prolonged review procedures after naturalisation.
• Malta’s is a legitimate, robust, professionally run and effective naturalisation scheme, transparent, carefully monitored and has a direct and positive impact on Maltese society.
• Successful applicants reflect a variety of links with the Maltese community, consisting in prior, present, and prospective bonds that evolve overtime

Advocate General's Opinion on Genuine Links in Citizenship Acquisition

• Article 9 TEU, Article20(1)TFEU and Declaration No. 2 do not permit the EU institutions, or other Member States, to introduce any conditions for the recognition of the nationality of another Member State, as confirmed by the Court in the Micheletti and Zhu and Chen judgements. (AG Opinion, para. 48).
• In the Tjebbes judgment, the Court held that a Member State may legitimately consider nationality to be an expression of a genuine link with that Member State. A Member State may therefore prescribe that the absence, or the loss, of a genuine link between it and an individual entails the loss of his/her nationality provided that the principle of proportionality applies with regard to the consequences of that loss for the person concerned from the viewpoint of EU law, particularly if this results in statelessness. The loss of Member State nationality by operation of law would be inconsistent with the principle of proportionality if the relevant national rules did not permit an individual examination of the consequences of that loss for the persons concerned. (AG Opinion, para. 54).
• The Advocate General agrees with the European Commission that, in the Nottebohm judgement, the International Court of Justice (ICJ) held that a State may refuse to recognise nationality granted by another State, in the absence of a genuine link or a connection between that individual and the State. (AG Opinion, para. 56)
• It follows that while a Member State, in accordance with its own nationality laws, may require proof of a genuine link, or the special relationship of solidarity and good faith between it and its nationals’ – EU law does not define, much less require, the existence of such a link in order to acquire or to retain that nationality. (AG Opinion para. 55).

The ICJ ruling is limited to allowing States to withhold recognition of nationality granted in the absence of such genuine link... It does not oblige States to require that such a link exists either between them and their own nationals or between other States and their nationals.
Advocate General, Opinion para. 56. (emphasis added)

Our Commentary on the Genuine Links Requirement

• The presence or otherwise of genuine links is relevant not as a requirement imposed on state’s citizenship laws, but as a prerogative for other states not to recognise citizenship granted without genuine links. This is not to say therefore that Malta must require genuine links, nor does the AG imply that Malta does not require them (in fact he comments that Malta does disprove the EC’s contention that Malta grants citizenship without genuine links.
• In fact, the binding guidelines on the 2020 Maltese Citizenship Rules require applicants submitting an application for eligibility to include in his application a commitment letter describing how, during his residency period potentially leading to naturalisation as a Maltese citizen, the applicant and his/her family propose to integrate through the establishment of “personal, financial and investment ties” during the year/s leading to citizenship. (verbatim from the Rules' Handbook).
• This Residence Criteria Proposal Letter is an integral part of an application, and is processed together with deep and comprehensive disclosure of assets, explanations of source of wealth, as well as background checks conducted by the applicant’s agents, and further background checks by the processing agency financed by pre-determined due diligence fees payable on application by the applicant.  
• Even after approval of eligibility, at various stages prior to the grant of citizenship, the Citizenship Agency verifies the completion of the commitments undertaken by the applicant family by way of personal, financial and investment ties, and in the case of material defaults, defer the grant of citizenship until the commitments are completed.

The Role of the Advocate General in the Court

History: The office of the Advocate General was introduced into the Treaty of Rome under the influence of the French who proposed a French model that allowed an official to offer legal advice to the court on cases being tried.

Appointment: Advocates General are members of the Court of Justice of the EU, and are appointed under the same procedure as judges and enjoy the same privileges (immunity) and cannot be removed from offices before the end of their 6-year term.

Role: However, unlike judges they only have an advisory role and do not take part in the decision-making process of the Court. The Advocate General assists the court by writing impartial opinions. In principle, the opinion of an Advocate General is sought in all cases to be tried by the CJEU, unless the Court decides that there is no new point of law (30% of cases annually, but clearly not this case). 

Influence of Opinions on Final Judgements: AG Opinions are not binding but are often followed by the CJEU. In the absence of dissenting opinions filed by the CJEU judges, the opinions of the Advocates General therefore play an important role and are referred to in later cases. The CJEU is not bound by these opinions; nonetheless, according to empirical research, in the case of an action for annulment of an EU act, the CJEU is 67 % more likely to annul it if doing so was advised by an Advocate General. (if interested, read more on the role of Advocate General here).

The Decision of the Court of Justice, EU

The Advocate General’s opinion clearly supports Malta’s position that the Mediterranean member state should be allowed to serenely determine the rules on he acquisition and deprivation of Maltese citizenship within the Island's sovereign competence, subject to the limits applicable to the loss not acquisition of citizenship.  

It is to be noted that the Advocate General's opinion is not binding on the Court and that the final decision ultimately lies in the hands of the Court of Justice of the European Union.  

As the judges deliberate, we can expect the final judgement as early as December 2024 or in the early months of 2025.

Inquiries

Should you wish to discuss the implications of this opinion on your application or on your existing citizenship, please reach out to us for a complimentary chat. But please bear in mind that the final decision will be out in the coming months.

Our Maltese Citizenship by Investment Services

We offer the following services in relationship to Malta Citizenship by Investment:

• advising you on your eligibility and your chances of success before filing your application;
• providing you with pre-immigration legal and tax advice;
• guiding you with the preparation and forwarding of the necessary documentation;
• vetting and preparing all supporting documentation for submission;
• assisting you with the purchase / rental of property in Malta including applications for AIP permits (foreigners need AIP permit to purchase property in Malta), reviews of your contract, liaising with the notary.

Applications for Maltese Citizenship by Investment are to be made to and processed wholly by Agenzija Komunita Malta. Dr Priscilla Mifsud Parker is a Licensed Agent, holding licence AKM-ACCA.