Malta Citizenship under Siege: Why Chetcuti Cauchi?

September 23 00:00 2019 by The Editor Print This Article

2019 saw an escalation of attacks on the Maltese Individual Investor Programme. In September that year, a French TV programme painted Malta as an island of corruption. Top citizenship lawyer won a French court decision and disproved claims on MIIP due diligence. Calls for suspension of the Maltese Citizenship programme.   

Chetcuti Cauchi and the IIP

Before the IIP, Chetcuti Cauchi rose up the ranks of Maltese law firms and financial services firms on the strength of Malta's newly acquired EU membership and a flourishing financial services sector.  In a relatively short span, the unconventional and business oriented law firm grew into a 150 strong firm playing with the big firms in the legal and professional services sector.

Chetcuti Cauchi rose to fame in the IIP with the announcement in early 2014 of its investor clients being the first Maltese citizenship approvals under the MIIP.  The firm continues to publish extensive research in the area of investment promotion, including publications on global citizenship programmes such as the Dual Citizenship Report, edited by Dr Chetcuti. 

Dr Jean-Philippe Chetcuti is very visible as a guest speaker at several international conferences as a lawyer specialising in investing in Malta. Commentators attribute this fact as the possible reason for singling him out for a media attack on Malta.

Malta ranks first in Chetcuti Cauchi's CIP Due Diligence Index, that researched due diligence applied by Citizenship by Investment programmes. This backs government assertions that the MIIP's due diligence was an international gold standard. Though the firm is not involved in politics, another of its studies, the CIP Index, ranks Malta first on objective rating criteria against other European and Non-European programmes, and was also seen as giving credibility to the Maltese programme and again, may have attracted this attack by opponents of the MIIP or of the Maltese Government.

Raw footage obtained by court order and published by the firm later in January 2020 proves how, even tested in hidden-camera circumstances, the prominent Maltese citizenship firm honourably represents the strictness and seriousness of the IIP's due diligence standard, as well as the selectiveness of the firm's client on-boarding rules. 

Related:

Complete Exoneration for Chetcuti Cauchi; “No Evidence of Collusion,” Citizenship Regulator

Legal practitioners were in glowing admiration of Dr Chetcuti for his professionalism revealed by the raw footage presented.  American attorney David Lesprence, named Dr Chetcuti as the legal personality he admires most in an interview he gave to an industry publication, saying:

Although I have never met, talked or worked with him, I would have to say Jean-Philippe Chetcuti. I hugely respect how he tackled the tyranny and power of the press. The video that was later uncovered showed him acting like a true professional. He laid out the issues involved in the case being presented to him and clearly communicated the limits to the program and the work which he would undertake. In short, he acted like a fiduciary and a professional and not an “I’ll do anything to close the deal” salesperson.

The IIP: Scandal or Blessing?

The introduction of a Malta Individual Investor Programme or MIIP, stirred a lot of controversy given citizenship by investment was a new concept for the Maltese.  The opposition party was immediately up in arms against the proposition.

The political climate in which the IIP was launched was one that saw the breaking of the pact between the two major political parties, an understanding that matters concerning Malta's attractiveness for international investment and business should enjoy bicameral support.  

On the one hand, the Opposition Party claimed the party in power, elected with a significant majority, was disregarding the opposition and springing upon the country a scheme that was never mentioned in their electoral manifesto.  On the other hand, the party in government claimed that the CBI concept promised economic and financial benefit to the country but was unfairly criticised by the Opposition party that thought of the IIP as a scandal. 

The outsourcing of the promotion of the programme to an international consultancy with a background in promoting citizenship programmes in Caribbean islands, raised eyebrows.  The tender was fiercely opposed by bidders who felt its was unfairly awarded but worse still, the local base of practitioners felt betrayed given an excellent track record of Malta's own professional firms professionally promoting Malta's attractiveness outside Malta's shores.  Recent official reports indicate the international consultancy charged the Maltese Government already €36 million for its marketing services, when Malta's IIP doesn't enjoy exclusivity in their promotional activity as the firm promotes over 10 other programmes besides the Maltese IIP.

What's Scandalous about the IIP?

Six years after the launch of the IIP, it is clear the country has benefited greatly from the financial inflow into the country.  So what's makes the IIP such a controversial scandal?

Citizenship for Sale

2014 saw the coining of the phrases: "Sale of Passports" , "Passports for Sale" and "Passports Salesman".  Objectors to the IIP protest that citizenship should not be for sale as it represents the identity and spirit of people with a real attachment of the country.  

In defence of the IIP, foreign players in the industry have argued that there is nothing wrong in people investing their way into a country, if they have the money as this is a well needed financial boost to the country's economy.  

Chetcuti Cauchi's Dr Jean-Philippe Chetcuti disagrees. "Citizenship should not be an over-the-counter transaction.  A sale transaction involves the sale of a product to anyone offering the quoted price. With citizenship by investment, it’s very different. An applicant first acquires residency in Malta, builds at least a year-long track record of connection with Malta that goes beyond physical presence. Meanwhile, a 6 month due diligence process in 4 levels is underway, requiring extensive disclosures about the personal and financial backgrounds.” Dr Chetcuti continues “Only after one passes all these tests is the financial contribution due to the state. When the contribution is completed, the invest must complete the remainder of the minimum one year residency and only then is citizenship granted to the family applicant....”

"A transaction like this, where money doesn’t guarantee the grant of citizenship cannot be fairly described as a sale of citizenship.”
Dr Jean-Philippe Chetcuti

Who is Chetcuti Cauchi?

Chetcuti Cauchi IIP Agent's main offices in Valletta

 

Chetcuti Cauchi is a international firm with a focus on investment promotion.  As stated on its website, the firm's practice groups revolve around the theme of foreign direct investment, namely corporate & commercial law, taxation, investment migration, and property investment.

As an investment focused firm, the firm promoted the Malta Citizenship Programme extensively together with all the other sectors contributing to Malta's attractiveness for investment: fintech, online gaming, corporate services, financial services, relocation and retirement schemes, property and yacht services.

The firm's managing partner Dr Jean-Philippe Chetcuti founded the firm in 2002 with his wife, lawyer Dr Maria Chetcuti Cauchi.  The firm is present in key financial centres worldwide and in Malta, 5 partners lead a staff complement of over 100 lawyers and professionals.  The firm has won various international and local awards, including the Blockchain Law Firm of the Year Award and the Best European Citizenship Advisor of the Year Award.  Chetcuti Cauchi is considered one of the largest law firms in Malta operating at an international level.