On the 3rd of July, Mr Alex Muscat, Parliamentary Secretary for Citizenship and Communities, confirmed that from September 2020 onwards, a new programme will be in place once new regulations take over. But how will the new programme look like against the actual Malta Individual Investor Programme (IIP)?
Practical changes to the Malta Individual Investor Programme (IIP)
So far, and pending the formal regulations to be passed, the announced changes to the Malta Individual Investor Programme (IIP) can be resumed as follows:
While this will remain a contribution to the National Development Fund and a Property investment, there is no official pronunciation regarding the Government Bond investment yet. Further to this, there will be 2 options leading to citizenship:
3-Year residence requirement: Applicants will be able to make a contribution of €600,000 for the principal applicant and €50,000 for every dependant and will be able to apply for citizenship after 3 years of effective residence
1-Year residence requirement: Should they wish to apply for citizenship after 12 months, applicants will need to make a contribution of €750,000 for the principal applicant and €50,000 for every dependant
Applicants will need to be granted residence in Malta prior being granted citizenship. While this may seem similar to with the actual Malta Individual Investor Programme (IIP) regulations, we are expecting a higher level of Due Diligence checks and background verifications at the residence stage.
Also, potential applicants may need to spend more time in Malta. However, it is improbable that an aggressive residency approach will be in place due to the mobility needs of Private Clients and HNW individuals.
As with the actual Malta Individual Investor Programme (IIP) regulations, applicants will need to purchase or rent a property. For purchase, the minimum value is set in at €700,000 – while previously €350,000 - and for rentals at €18,000, while previously set at €16,000.
Regarding the investment of €150,000 in stocks, bonds, or other investment vehicles, the Government still has not yet pronounced this. Still, it is expected that they will be scrapped. Also, a mandatory donation of €10,000 will be in place, which is something already in practice under the current Malta Individual Investor Programme (IIP) regulations.
Other upcoming changes to the programme relate to the number of approved applications. There will be a cap of 400 approved applications per year with an overall of 1,500.
The applications will be handled by a new agency replacing the Individual Investor Programme Agency, which will be responsible for all paths leading up to Maltese citizenship. Agents will need to be professionals who are familiar with laws related to anti-money laundering and financing of terrorism.
How does this affect your situation?
You still have time to submit your residence application under the current Malta Individual Investor Programme (IIP) until the 31st of July, and Citizenship until the 30th of September. If you haven’t done this yet, contact us, so that we can advise you further.
If you have residence under the current Malta Individual Investor Programme (IIP) rules, but you do not submit your application before the 30th of September, your application will fell within the new regulations.
We expect that these changes will keep the Malta programmes at the vanguard of the Investment Migration industry
Investing in a second Citizenship or Residence by investing in the jurisdiction of choice can certainly protect HNWI and their families, as well as giving them independence, freedom and flexibility.
CSB Group Citizenship & Planning services are headed by Andres, who assists Private Clients, HNW and UHNW individuals and their families in deciding their best routes to achieve Financial Diversification, Freedom & Security through a Sound and Smart Investment in Europe or the Caribbean.
About the Author
This article has been authored by Andres Gutierrez, CSB Group's Investment Migration Consultant. Please contact Andres on +356 9924 1428 on WhatsApp, Telegram or WeChat, or directly on [email protected].