Just a few years since its inception, Residency Malta is already seeing how its work can act as a multiplier for the economy, bringing people to Malta who may decide to invest, start up companies and even work here.
Picture: Charles Mizzi, CEO, Residency Malta
CEO Charles Mizzi explained that the majority of people applying for residency are seeking better opportunities for their families, enticed by issues like personal safety and geopolitical stability, and subsequently by the high standards of health care and education.
Perhaps this is why the average applicant of the Malta Permanent Residence Programme is in their mid-40s with young children, who want to bring with them their parents.
"They often come to Malta before they apply but, once here, many fall in love with the island. One of our applicants expressed amazement at the fact that his children could play safely outdoors! We take many of these things for granted, but the sad reality is that we actually see a spike in applications from countries when there is instability or violence there." he explained.
Malta is by no means the only country in the EU to offer residency programmes – no fewer than 25 offer such programmes – and it maintains good relations with the European Commission. Indeed, the majority of recommendations made at the working group level are already part of Residency Malta's existing framework. This is important as one of the advantages of residence is access to the Schengen area – for 90 out of 180 days.
Residency Malta also launched the Nomad Residence Permit two years ago, a 1-year permit renewable twice for a maximum stay of 3 years. It was designed originally with those aged 26-35 in mind. The response was a pleasant surprise.
"We realised how many people – especially after COVID – were moving around from place to place, working remotely from different countries. The concept is quite new – in fact, we got one application from someone who wanted to work in construction, hardly something that you can do remotely!" he recalled with a smile.
"However, the reality is that the average age is 37. And the idea of a nomad as a single person seeking mobility is not quite accurate: around 28% come with families. And they have to spend at least five months of each year in Malta.
"Also, to be eligible, you need to have an income of €32,400 but the average income is actually €74,000, since we have people in C-suite positions, such as CEOs. What does this mean for Malta? Well, we commissioned a study which showed that these individuals spend around €2,800 a month in the country, on everything from food and housing, to leisure and entertainment. If we have 500 individuals, this would bring €16 million into the economy every year – which we verify through their bank statements."
"We had one person who moved to a Key Employee Initiative – a fast-track work permit administered by Identity Malta for highly specialised Third-Country Nationals employed in Malta – and opened a company. Nomads could help to solve the worldwide shortage of qualified personnel in key areas. The majority are graduates and some have Masters and even PhDs," he said.
The number of applications has trebled since the programme was launched, from 20-25 applicants a month to over 75 a month, with a peak of 100 in one month. Some 47% apply for renewal. However, Mr Mizzi stressed that the emphasis was on quality and not quantity, which can only be ensured through a rigorous due diligence process. The due diligence team remains the largest share of its 50 employees.
The agency is joining the one-stop shop concept that it going to be introduced by entities like the Commissioner for Revenue, Malta Business Registry etc, where applicants upload documents once which are then available to all, for example.
"Our application documentation is quite hefty. We are doing our best to cut down on duplication. Over the coming months, we plan to introduce more efficient methods."
Although Residency Malta keeps an eye on ways to improve efficiency, this is not going to be achieved at the expense of being thorough. It currently takes some 4-6 months to process an application for the Malta Permanent Residence Programme, which may seem endless to those awaiting a decision but which ensures that the process is followed diligently. This can be seen from the figures: around 10% of applications are refused outright, while 3-4% are withdrawn by applicant, quite a high percentage given that the global average is 5%.
What is the impact on Malta?
"This generates considerable revenue – directly and through fees – as well as taking up high-end properties (purchased or rented). However, there are indirect benefits. We believe that each person that comes to Malta seeking residency may eventually extend that to working or investing."
The latest programme introduced by Residency Malta is the Startup Residence Programme. Apart from having a concept which is innovative – not an easy definition to pin down – the applicant also needs to have financial backing, and at least one shareholder must relocate to Malta. Applicants get a 3-year permit – the crucial time for a startup – with a further 5-years possible as long as targets are met.
"We are working with Malta Enterprise on this; they are the experts after all. This means that we take care of the due diligence and residence permit side while Malta Enterprise will assess the business case."
Residency Malta has a dynamic marketing team, using various tools to disseminate its message, from webinars and seminars to international digital influencers and its licensed agents. The result is €16.4 million for Malta's coffers just in 2022.
"It is very tempting to go for higher numbers. However, first and foremost, we want to focus on quality and on the multiplier effect that being in Malta has on these applicants, who get here and realise how much the country has to offer."
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