European Parliament votes to ban granting citizenship against investment to Russian applicants
The EP is targeting countries which are making secret deals with oligarch and ultra-rich from Russia offering “safe deposit” of their cash .
On March 9, the European Parliament voted overwhelmingly to limit citizenship-by-investment (CBI) programs in the European Union. The vote, formally adopting a report by Sophie Int’ Veld, a Dutch Member of Parliament, calls on the European Commission to enact legislation to phase out CBI programs and establish strict regulations governing residence-by-investment (RBI) programs - writes Damsana Ranadhiran
Consistent with sweeping sanctions levied against Russia and affiliated entities and individuals in the wake of that country’s invasion of Ukraine, the Parliament is additionally calling for an immediate end to the processing of all Russian applicants of CBI/RBI programs. The Parliament is also calling for EU members to “reassess” all approved applications from Russian citizens from the past few years to ensure that “no Russian individual with financial, business or other links to the Vladimir Putin retains his or her citizenship and residency rights”.
Potential benefits of CBI/RBI programs are manifold. Permanent residence allows successful applicants of programs implemented by EU states to freely enter the EU Schengen Area (a bloc of 26 countries that have officially abolished all passport and other border controls at their mutual borders) and the UK, without having to apply for a visa or undergo any additional screening by authorities in the EU. A grant of citizenship confers even more rights and privileges, in particular the right to obtain a national passport. Unlike residency, citizenship has no time limitations, is valid for life, and is inheritable; it is revoked only in rare and exceptional cases.
More than 100 nations offer some form of CBI/RBI program, according to data from the Organization for Economic Co-operation and Development (OECD).
Lawmakers in Europe have been calling for the termination of CBI programs since 2014, but the issue is gaining renewed focus in light of the Russian oligarch’s penchant for such programs. For decades, CBI programs have attracted Russia’s wealthy citizens, purchasing passports through real estate investments that are often secondary to the passports themselves. In January, Portugal opened an investigation into Roman Abramovich, the current owner of the Chelsea Football Club and a one-time Kremlin official, reportedly close to Putin, and his successful bid to become a Portuguese citizen (the probe was reportedly triggered amid criticism that the law offering naturalization to descendants of Sephardic Jews was being misused by oligarchs).
Separately, Irina Abramovich, the ex-wife of Roman Abramovich, was implicated in a report published in The Guardian, in connection with her application for Maltese citizenship (it was reported that Ms. Abramovich was one of 851 Russians to seek Maltese citizenship under a program facilitated by a consultancy firm, according to a leak of the firm’s data). While most countries with CBI/RBI programs do not disclose grants of citizenship or residency, the data suggests that CBI/RBI programs have proven most popular with Russian nationals. For example, one study determined that in Cyprus, 19.6 percent of the people naturalized in 2018 were Russian, and in Malta, Russians constituted the third-most common nationals to naturalize in 2018.
On February 26, the European Commission, France, Germany, Italy, the United Kingdom, Canada and the United States committed to “limit the sale of citizenship… that let wealthy Russians connected to the Russian government become citizens . . . of our countries and gain access to our financial systems”.
In the press release issued by the Parliament regarding its vote of March 9, Vladimír Bilčík, MEP for Slovakia, stated, “We must ban the sale of EU passports and stop the flow of Russia’s dirty money into the EU”.