Country Nationals (ECRIS-TCN)66 have been proposed by the Commission. The Commission
has also proposed to make all information systems interoperable67.
Practices regarding investor citizenship and residence schemes can undermine these efforts by
allowing third-country nationals to avoid some of these checks, with implications for other
Member States and the EU as a whole. It is therefore important that any investor citizenship
and residence schemes are organised in such a way as to prevent such security risks. The
absence of internal border checks within the Schengen area makes it particularly important to
ensure that the commonly agreed and adequate security preventive checks are implemented.
Security and investor citizenship schemes in the Member States
The study was able to identify only very limited legislation or guidelines concerning the
actual practices in relation to investor citizenship.
In Malta, checks based on police records from the Maltese police and/or from the competent
authorities in the country of origin are made on the criminal background of the main
applicants and their dependants over 12 years of age. The requirement to prove a clean
criminal record may be waived in exceptional circumstances, where the competent authority
considers such a certificate impossible to obtain68. The Maltese authorities consult
INTERPOL and Europol databases as part of a four-tier due diligence process covering69:
know-your-client due diligence checks by the agent and the Malta Individual Investor
Programme Agency (see section on anti-money laundering checks below); clearance by the
police authorities; a check for completeness and correctness of the application and verification
of the documents submitted; and an outsourced due diligence check whereby the Malta
Individual Investor Programme Agency to present evidence that they have commissions two
reports from international companies on every IIP application70. Malta excludes nationals of
certain countries71 and persons subject to travel bans imposed by the United States from
applying for citizenship under its scheme, whereas applicants showing on any other sanctions
or watch lists must be reported by agents to the Malta Individual Investor Programme
Agency72.
66
67
68
69
70
71
72
Proposal for a Regulation of the European Parliament and of the Council establishing a centralised system
for the identification of Member States holding conviction information on third country nationals and
stateless persons (TCN) to supplement and support the European Criminal Records Information System
(ECRIS-TCN system) and amending Regulation (EU) No 1077/2011, COM/2017/0344 final - 2017/0144
(COD). The negotiations are at an advanced stage in the trilogue process.
Proposal for a Regulation of the European Parliament and of the Council on establishing a framework for
interoperability between EU information systems (borders and visa) and amending Council Decision
2004/512/EC, Regulation (EC) No 767/2008, Council Decision 2008/633/JHA, Regulation (EU) 016/399
and Regulation (EU) 2017/2226.
For instance, if the competent authority in the country of origin would not issue certificates for short or
intermittent stays. In those cases, a sworn affidavit from the applicant and any dependants, declaring a
clean criminal record, will suffice.
Further details available at: https://iip.gov.mt/due-diligence/
Information gathered through consultation with national stakeholder (Identity Malta, competent authority, 8
March 2018) for the purposes of the Study, ibid, note 4. This is based on Regulation 7(2) of LN 47/2014
that states that the ‘due diligence checks shall be of a four-tier nature’ without further specification.
Nationals or residents of Afghanistan, Iran and the Democratic People's Republic of Korea, or with
significant ties to these countries, are excluded from the Maltese IIP.
Maltese Individual Investor Programme Handbook 2018. Also excluded are persons who have been denied
a visa by a country with whom Malta has a visa-free travel agreement.
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