In a highly anticipated decision delivered on 29 April 2025, the European Court of Justice (ECJ) ruled that Malta’s Citizenship by Investment scheme, formally known as the Malta Exceptional Investor Naturalisation (MEIN) policy, breaches European Union law.
The Court found that Malta’s practice of granting citizenship in exchange for financial contributions, without requiring any real connection to the country, violates fundamental principles of EU citizenship. According to the judgment, offering nationality primarily for payment undermines the meaning of Union citizenship and conflicts with Article 20 of the Treaty on the Functioning of the European Union (TFEU) and the principle of sincere cooperation under Article 4(3) of the Treaty on European Union (TEU) (European Court of Justice, 2025).
Background
The European Commission initiated infringement proceedings against Malta in October 2020, arguing that the MEIN policy risked undermining the rights attached to Union citizenship (European Commission, 2020).
Despite ongoing dialogue, Malta declined to end the scheme, leading the Commission to refer the case to the Court of Justice in September 2022 (European Commission, 2022).
Although the Advocate General’s non-binding opinion in October 2024 had suggested dismissing the Commission’s complaint, the Court ultimately sided with the Commission.
Key Elements of the Ruling
The ECJ held that Member States retain sovereignty over nationality matters, but when those decisions impact Union citizenship, they must respect EU law.
The Court emphasised that Malta’s MEIN scheme offered citizenship without requiring any genuine connection, cultural ties, or sustained engagement with the country.
By doing so, Malta breached the principle of sincere cooperation with the Union.
As part of the ruling, the Court ordered Malta to pay the legal costs of the proceedings.
Wider Impact
With this decision, Malta must now bring its naturalisation practices into conformity with EU law.
The ruling confirms that citizenship-by-investment programs based solely on financial contributions are not compatible with Union citizenship rules.
The case places additional pressure on any remaining Member States that offer or are considering similar models.
Malta’s MEIN scheme was the last citizenship-by-investment program within the European Union after Cyprus terminated its offering in 2020 and Bulgaria closed its scheme in 2022.
The European Commission welcomed the Court’s judgment, reaffirming its stance that European citizenship must not be treated as a tradable commodity (European Commission, 2025).
What the Ruling Means for the Industry
The European Court of Justice’s decision marks a defining moment for the future of investment migration in Europe. By ruling against Malta’s Citizenship by Investment program, the Court has reinforced the principle that Union citizenship cannot be commoditised or detached from a genuine connection to a Member State.
For the investment migration sector, the ruling sends a clear message: future models must prioritise residence, integration, and long-term engagement rather than financial transactions. Firms advising on citizenship and residency strategies will increasingly need to guide clients towards compliant, residence-based programs that align with evolving European legal standards.
The decision also highlights the European Commission’s sustained commitment to safeguarding the integrity of Union citizenship, a trend that is likely to influence regulatory discussions beyond Europe in the coming years.
While the immediate implications focus on Malta, the broader effect is a continued shift in the global investment migration landscape — away from direct citizenship routes and towards residence pathways that require meaningful ties to the host country.
Industry participants will need to closely monitor Malta’s next steps and assess how similar offerings elsewhere may need to adapt under growing regulatory pressure.
The ruling ultimately underscores that Union citizenship is not only a set of rights, but also a shared responsibility between Member States and their citizens — one that must be preserved with transparency, sincerity, and respect for European law.
