On Wednesday, MEPs adopted a legislative initiative report calling on the Commission to submit a proposal by the end of its term. In Monday’s plenary debate, many speakers also referred to the commitment made by the European Commission, France, Germany, Italy, the United Kingdom, Canada and the United States to restrict the access of wealthy Russians (with links to the government) in “gold passports”. The final text was adopted by 595 votes to 12, with 74 abstentions.
Prohibition of “golden passports” …
Parliament emphasizes that Citizenship by Investment (CBI) programs, under which third-country nationals can acquire citizenship rights for a sum of money, undermine the essence of EU citizenship. Malta, Bulgaria and Cyprus) as “opportunistic behavior”, as these Member States sell something that was never intended for goods. Applications have been accepted even when the conditions were not met, MEPs say, calling for the phasing out of these programs because of the risks involved.
… and special rules for “golden visas”
Noting that “Residence by Investment (RBI”) programs pose less serious risks, Parliament called for EU-wide rules to tackle money laundering, corruption and tax evasion. In particular, Parliament calls, inter alia:
– that applicants undergo rigorous background checks (which will also affect their relatives, as well as the origin of their funds), that their data must be cross-checked in EU-maintained databases and that any control procedures have been conducted in third countries
– to oblige each Member State to notify any requests it processes, through a “notification and consultation” system which will allow other Member States to object!
– establish requirements regarding the minimum duration of actual residence in the country (for applicants) and active participation, quality, added value and contribution to the economy (for their investments).
No passport and no visa for Russian oligarchs
Parliament welcomes the intention of the Member States concerned to stop selling EU citizenship to Russian citizens with ties to the government, calling for the immediate exclusion of Russian applicants from the programs of both types. MEPs are urging EU governments to reconsider all applications they have approved in recent years and to ensure that “no Russian individual with financial, business or other ties to the Putin regime” can use an EU passport or visa. They also call on the Commission to exclude all Russian nationals subject to EU sanctions from all “golden visa” programs.
A fragmented system and the role of intermediaries
MEPs regret the lack of comprehensive security controls and control procedures in both types of programs, adding that successive applications should not be allowed in different Member States. Member States should not base their decisions on audits by non-state actors. Parliament also called for a special contribution to the European budget, which would account for a significant proportion of investments made in the Member States. This contribution will be imposed on the “golden passports” until they are permanently abolished, and on the “golden visas” indefinitely. Parliament also calls on the Commission to ensure that the same example is followed by third countries whose citizens enter the EU without a visa.
Pointing out that intermediaries do not operate in a transparent manner and are not accountable to anyone, Parliament calls for a ban on their participation in “citizenship through investment” programs. He also called for a “strict and binding regulation” on their role in “investment accommodation” programs, which should provide for sanctions in the event of a breach of the rules.
The rapporteur Sophia in ‘t Veld (Renew, Netherlands) commented: “These programs only serve as a’ backdoor ‘for suspects who could not openly enter the EU. It is time to close this door so that the Russians oligarchs and other people with ‘dirty’ money staying out of the EU. Some Member State governments have been refusing to address the issue for years, arguing that it is not the EU “.
Next steps
The Commission should table a legislative proposal or justify its decision not to do so.
At least 130,000 people have benefited from “citizenship / residency through investment” programs in the EU from 2011 to 2019, bringing in more than € 21.8 billion in revenue for the Member States that implemented them. “Investment citizenship” programs exist in Malta, Bulgaria (where the government has submitted a bill to end the program) and Cyprus (where on the one hand the country processes only applications submitted before November 2020, on the other hand the government has declare that it has completed the processing of the relevant applications). Twelve Member States have “accommodation through investment” programs. The amount and type of investment required to join the program varies greatly from country to country.
Source: Capital
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