A new Legal Notice 161 of 2020 was recently published amending the principal regulations governing the Malta Individual Investor Programme of the Republic of Malta (L.N. 47 of 2014), otherwise also known as the Malta Passport Programme (the "Programme").
Prior to the amendment, 70% of the revenues derived by the Government of Malta ("GoM") from the Programme (essentially, the contributions paid by main applicants for themselves and their dependants under the Programme) were channelled into a special fund called the National Development and Social Fund established by the 2014 principal regulations to meet certain special public interest purposes, such as education, research, innovation, and other social and institutional purposes.
Now, as a result of this recent amendment,
(i) 20% of the revenues so generated will be paid to the
National Development and Social Fund (i.e. no longer 70%);
and
(ii) the balance (80%) will be paid directly into the Consolidated
Fund (which is the central fund set up by the Constitution of Malta
for all revenues derived by the GoM from most sources of revenue
generated by it and from which most government expenditure is then
made).
This is a tectonic shift in the GoM's view of the purpose and value of the Programme, the obvious catalyst being COVID-19. It indicates clearly and unequivocally the heightened importance the GoM is attaching to the Programme and the revenues generated (and still to be generated) by it in the context of the expected contraction in Malta's economic activity due to COVID-19 and the cost of the financial assistance schemes put in place by the GoM to mitigate COVID-19's impact on the economy.
Furthermore, in response to a question posed during a press conference on May 1, 2020, the Prime Minister – after reiterating earlier GoM public statements about the Programme's economic value for the country – declared that a new 'passport' scheme will be launched once the numbers available under the existing Programme are taken up over the "next weeks or months".
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