The Grand Chamber’s judgment in Commission v. Malta (C-181/23), delivered on 29 April 2025, marks a decisive step in the European Union’s effort to uphold the integrity of Union citizenship.
The Court of Justice held that Malta violated Articles 20 TFEU and 4(3) TEU by operating an investor citizenship scheme that granted nationality in exchange for predetermined payments, absent any genuine connection between the applicant and the state.
The scheme – officially titled ‘Citizenship by Naturalisation for Exceptional Services by Direct Investment’ – allowed third-country nationals to acquire Maltese (and thereby EU) citizenship after making a financial contribution, investing in property, and residing in Malta for as little as twelve months. No requirement of effective integration or meaningful social ties was imposed. The European Commission argued that this commercialisation of citizenship undermined the essence of Union citizenship and breached the principle of sincere cooperation between Member States.
While nationality attribution remains a Member State competence, the Court confirmed that this competence is not unbounded. When the conferral of nationality leads to EU citizenship – and hence the rights to free movement, consular protection, and political participation –, it must comply with the principles and values of Union law. The Court found that Malta’s transactional model bypassed the logic of integration and mutual trust underpinning Union citizenship, thereby distorting its legal and constitutional function.
Notably, however, while the European Commission’s application prominently framed its argument around the absence of a “genuine link” between investor applicants and the Member State (Malta), the Court of Justice notably refrains from endorsing or applying the concept of a “genuine connection” in its legal reasoning. Indeed, although the phrase appears in the Commission’s claim that Malta’s scheme offers naturalisation ‘in the absence of a genuine link of the applicants with the country’ (see para 1 of the judgment) and is reiterated in the Commission’s plea (paras 41–46), the Court avoids relying on this terminology in its assessment.
Instead, in paragraphs 112–117, the Court focuses its analysis on the transactional structure of the scheme and its compatibility with Union law—specifically, Article 20 TFEU and Article 4(3) TEU.
The Court criticizes the Maltese scheme not for failing to establish a genuine link per se, but because the naturalisation process is reduced to a financial transaction, devoid of integration requirements or meaningful individual evaluation of ties to Malta. The judgment emphasises how such schemes undermine the value and integrity of Union citizenship by detaching it from any substantive relationship with the conferring Member State. This careful choice of language by the Court – eschewing the “genuine link” doctrine rooted in the International Court of Justice’s Nottebohm case in 1955 and debated in international and EU legal scholarship – suggests a preference for grounding its reasoning in the EU’s constitutional principles (mutual trust, sincere cooperation, and the special nature of Union citizenship), rather than importing contested international law concepts. As Spieker and Weber note in a recent analysis, the genuine link doctrine remains contentious, and the Court’s decision arguably reflects sensitivity to the limits of EU competence in nationality matters and the potential constitutional implications of enforcing a rigid link requirement.
Thus, the CJEU’s reasoning is very clear: naturalisation policies that are purely fiscal fail to respect the social fact of attachment that should underlie the legal bond of nationality. Therefore, this is not merely a technical clarification. The ruling reinforces the Union’s broader normative order. It asserts that EU citizenship is more than a legal consequence of national citizenship: it is a status that binds individuals to the Union polity and cannot be commodified. The principle of sincere cooperation, the Court underlined, obliges Member States to refrain from practices that risk undermining the coherence and trust required to sustain the Union’s shared legal space.
With this in mind, in its analysis of Malta’s investor citizenship scheme, the Court directly addresses, in paragraphs 112–117 of the judgment, the concerns surrounding the use of such programmes as potential vehicles for money laundering, tax evasion, and regulatory circumvention. The Court focuses particularly on the substantive function of the eligibility checks provided for under the 2020 scheme. While Malta asserts that these checks are robust-assessing applicants’ business affiliations, political exposure, reputation, and sources of wealth-the Court notes that their primary objective is limited to safeguarding national security and Malta’s international image, rather than verifying the existence of a genuine connection between the applicant and the State.
According to the Court, although these verifications serve to filter access to the scheme, they do not alter its essentially transactional structure. In other words, the core of the programme remains the granting of citizenship in return for predetermined financial contributions—an approach the Court deems incompatible with the essence of Union citizenship. Malta’s argument that financial investments or the potential for future ties with the country can justify naturalisation is also rejected. The Court finds no evidence of any mechanism for qualitatively assessing the relevance of such investments, nor does the scheme include a post-naturalisation requirement capable of compensating for the absence of a genuine link at the time of acquisition.
Finally, the Court observes that the possibility of revoking citizenship under exceptional circumstances—such as national security threats or failure to fulfil legal obligations—does not negate the fundamentally commercial nature of the programme. Consequently, the Maltese scheme is characterised as a form of ‘commercialisation’ of Union citizenship, undermining the principle of mutual trust among Member States and breaching the obligations laid down in Articles 20 TFEU and 4(3) TEU.
Malta’s refusal to fully repeal its scheme, even after suspending access for Russian and Belarusian nationals following the invasion of Ukraine, ultimately triggered the infringement action.
Commission v. Malta is therefore more than an enforcement case. It is a constitutional judgment that elevates Union citizenship above the reach of market logic. By affirming that access to this status must be based on genuine ties, the Court has set a precedent for interpreting EU citizenship as a political, not merely economic, bond. This ruling is likely to shape future discussions on the harmonisation of naturalisation standards and reinforce the Union’s legal boundaries against national practices that instrumentalise its core values.