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27 October, 2021
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Curtain rising for citizenship-by-investment program

Cyprus has four possible ways of dealing with the current polemic against its 'golden passports' program

Marina Economides

Marina Economides

The Presidency has before it four scenarios for dealing with the issue of purchased citizenships. The most likely possibility is that of suspending the investment program for a short period, as revealed by Kathimerini on Sunday.

The four scenarios are as follows: a) Termination of the investment program b) Suspension for a period of time and examination of problematic cases for potential revocation of passports c) A more detailed briefing of the European Commission on the people receiving a Cyprus passport as a result of investment d) A continuation of the program as currently structured with a strict adherence to rules

Government circles are already skeptical about whether the scenario involving a suspension of the program could come about, as given the difficult economic period, stakeholders will push in the opposite direction, with a potential suspension expected to be short.

The issue of revoking passports, due to the serious blow suffered by the country, was raised by the President of DISY Averof Neophytou at a press conference on Monday morning. Already in Brussels, resentment has flared once again, with the European Commissioner for Justice examining the possibility of legal action against Cyprus over the granting of citizenship through investments.

A timeline of warnings

Brussels has long been sounding the alarm and warning about the investment program. The first reactions came when a Cyprus link came to the fore in the case of the Russian oligarch Oleg Deripaska. Indicative is what the President of the Republic heard from MEPs about the investment program in 2018, when he was in Strasbourg to speak before the European Parliament. He then defended the program, noting that Cyprus gave only 0.3% of the citizenships granted by European countries to third-country nationals. "It is not in my country that third-country oligarchs own football teams, nor is it in my own country that large squares and buildings belong to oligarchs," he said. Besides, there was a serious dispute between the President and the European Commissioner Christos Stylianides over this issue, who unsuccessfully asked for restraint on the part of the Republic of Cyprus.

Le Monde and Věra Jourová

The issue certainly did not end there. There followed publications, shortly before the Report on the Cyprus program, dealing with controversial figures who were granted Cyprus citizenship such as the Malaysian fugitive Jho Low and the Cambodian dictator, that stirred discussions in Cyprus over the need to put an end to the program.

There was also the move of the Vice President of the European Commission for Values ​​and Transparency, Věra Jourová, to share on her personal account an article of the French newspaper Le Monde entitled ‘The Golden Passport Scandal in Cyprus’. A move that had its own semiology. Not only because it was published by a newspaper that has excellent relations with the Commission but also because it is a well-known secret that when the EU wants to send a warning to a Member State about its actions, but also about what it intends to do, it first channels the news in well-known media to cultivate the soil. This was also done before the slashing of deposits.

Cyprus put on the stand  

It is in this context that everything that was published by the Al Jazeera Investigative Unit is considered to fall. European Commissioner for Justice Didier Reynders has already revealed in a comment to Al Jazeera that he is considering legal action against Cyprus over its citizenship-by-investment scheme. He had noted that he would like to see some action from the European Union on new legislation, but most of the responsibility lies with Cyprus. In addition to the Commission, German MEP Sven Giegold, who is a fierce critic of Cyprus' investment program, raised the issue last Friday of referring Cyprus to the European Court of Justice for violating European law.

The truth, however, is that at the level of the College of Commissioners, the issue of Cyprus and the investment program has not been discussed at the moment. Political circles in Brussels note that it is acknowledged that Cyprus has made improvements on the investment program and that what is coming to light is a past ‘sin’.

According to the same circles, it is very likely that the Commission will make a proposal regarding the program, which will not only concern Cyprus but all EU Member States that implement such schemes. There are also circles that estimate that although the Commission cannot impose a suspension of the program as it does not have such a mechanism, it will push through other channels to either suspend the investment program, or to tighten the implementation of the new regulations. Political circles note that while citizenship is within the jurisdiction of the Member States, the EU can initiate infringement proceedings by claiming that Union principles and values ​​are being violated.

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