Kochenov Expects “Strong Growth of CBI in Europe” If ECJ Dismisses Malta CBI Case – IMI

IMI sat down with Professor Dimitry Kochenov of the Central European University in Vienna and Budapest to discuss the ECJ Advocate General’s Opinion in the EU Commission’s court case against Malta.

Professor Kochenov is the author of various citizenship by investment works and one of the leading academic experts in the realm of residency and citizenship by investment (RCBI).

What was your initial reaction to the Advocate General’s Opinion?

The beautiful reasoning in AG Collins’ Opinion offers no surprises. As a matter of fact, I don’t believe it was unexpected to anyone with at least a minimal knowledge of European Union law.

The EU and its Member States act within strictly delineated boundaries of competencies, including in relation to the legal frameworks that govern the matter of citizenship and naturalization, and Advocate General Collins did a very good job of highlighting them in his masterful analysis.

He points out (in point 45 of his Opinion) that the Member States could have decided to pool their competencies and confer on the European Union the power to determine who who can acquire EU citizenship.

Yet, they have chosen not to do so as “conceptions of nationality touch on the very essence of their sovereignty and national identity, which they do not intend to pool.”

The Advocate General also makes a critical distinction in his analysis, where he points out the difference in the EU’s role when a Member State grants or revokes nationality: a seemingly counter-intuitive distinction, which works well, however, in the context of the Opinion. He highlights the main purpose of EU citizenship: the protection of the rights of the individual.

It is uniquely for each Member State to determine in its law whether an individual possesses that state’s nationality. The EU has no say when a Member State naturalizes a person: the connection between the person and the Union does not exist before naturalization.

When that state intends to strip that person of their nationality, however, the EU does have a role to play. When a person is a citizen of a Member State, they are automatically an EU citizen, which is a supranational – not a national – legal status that the Union has to protect.

If Malta, for example, wants to revoke a person’s citizenship, the EU now has to play a role in protecting that EU citizen’s rights and their very status of Union citizenship.

When do you expect an official court ruling, and do you think the judges will agree with the Advocate General?

The ruling should come within a year or faster.

The Advocate General is a full member of the Court, just like the judges of the ECJ. His Opinion will remain part of the body of jurisprudence of the Court, and ECJ judges may continue to refer to it in the future, irrespective of which position the Court ultimately takes in this concrete case.

As for the ruling to expect, we have to look at the Commission’s legal arguments, which are weak, as AG Collins also shows with clarity.

We can’t say for sure what the Court will decide; that is up to the judges, but we can analyze the Opinion and the law involved.

Indeed, four years ago, I predicted in conversation with you that the Commission would be humiliated as a result of its ultra vires action, and so far, this is exactly the case; it is not every day that an AG recommends dismissing a case and orders the Commission to pay the costs – as he did here.

There seems to be an implicit assumption among the Commission officials that blood is the superior link, but they cannot say that out loud – no one wants to be openly racist, as I have argued in a London School of Economics working paper.

The European Commission based its case against Malta on an unwritten assumption that blood and ancestry are the main “genuine links” between a person and a state. This argument is flawed, as it is not grounded in EU or international law.

Indeed, the link of blood is not what the Union is about. One of the main reasons the Member States created the European Union was precisely to overcome the petty nationalisms of the Member States following the massacre of the Second World War.

The assumption of blood or ancestry being the optimal genuine link relevant in the context of EU law contradicts the EU’s founding principles of non-discrimination on the basis of nationality, which de facto “abolished” the individual nationalities of the Member States within the scope of application of EU law if we believe Prof. Gareth Davies’ (VU Amsterdam) convincing analysis and also free movement of citizens in the EU.

Once nationalities lose their legal relevance, blood or other ties can be invoked to reverse the core principles of EU law, as the AG clearly underlines; the absolute presumption of mutual recognition is precisely that.

Spain, for example, must recognize Maltese, Spanish, Irish, Estonian and other member states passports.

Imagine an Italian child born in Brussels and living there all his life as his parents work in the Belgian city.

He studies in Belgian schools and speaks French; his parents contribute to the Belgian economy and pay taxes in Belgium. This child will have more genuine links to Belgium than Italy, but based on the European Commission’s arguments, he would have a “genuine link” link to Italy, a country he has never seen.

Once blood is dismissed, the link evaporates since it has nothing to do with reality if one is not a nationalist. This is precisely why EU law does not require such a link.

The European Commission usually portrays the EU as a cosmopolitan entity, embracing diversity with 27 nationalities. Yet, this is a eurowhiteness cosmopolitanism, to quote Hans Kundnani’s recent book.

The Commission v. Malta litigation seems to offer more proof of the fact that the Commission views itself as the guardian of such an almost oxymoronic supranational nationalism, where ethno-cultural Europeanness acquires crucial importance.

Eurowhiteness nationalism is the only possible explanation for regarding the right blood as the most genuine link to Europe. This preference directly contradicts the EU’s founding principles of overcoming nationalism and promoting non-discrimination based on nationality.

Why would the EU, then, undertake this legal endeavor if it didn’t have a strong legal foundation?

The Commission likes to push the envelope every now and then. Even if it knows something is outside of its officially conferred powers, it may try to push the boundaries to see what may happen.

The Commission has a very strong legal team. I cannot speculate on what happened, but it seems like the Commission silenced the voice of every single one among the competent legal experts they have in order to whitewash a questionable political move to sacrifice the law in the name of the hateful ethnonationalism paradigm presenting “genuine citizenship” as a genetic, biological truth.

This is an approach that once destroyed this continent already, making this logic coming from Brussels particularly misplaced, like one of Mussolini’s public slogans left on Italian façades of the era taken stupidly and seriously, with no irony and lessons learned.

Eurowhiteness is bound to be dumb. It would be absolutely impossible to provide anything but flawed legal arguments here. So, putting such a weak case in front of the highest Court of our continent is both puzzling and revealing. So, why did that happen? And why did the Commission silence and sideline its legal experts?

I think there is, of course, a possibility that this repugnant Eurowhiteness thinking has seeped into the legal service, too. But I don’t want to presume that – it’s just a possibility.

What I do see is that the Commission isn’t guided by the law anymore when making important decisions. This goes beyond just citizenship issues.

Think about showering Hungary’s PM Orbán with billions for going to the loo when an important decision on Ukraine is taken – instead of sanctioning Hungary, which the Commission proclaimed a bad player earlier.

Or think about keeping Libyan criminals on the EU’s payroll, tasking them with committing crimes against humanity at sea on the EU’s behalf, with dozens of thousands dead and no one responsible. Sarah Ganty and I call this kind of law “EU lawlessness law.”

Creeping competencies are a typical reality for political bureaucracies operating within a system of democratic and legal checks – they often end up serving their own interests.

But here’s the problem: The Commission was supposed to be a legal bureaucracy, not a political one.

That’s why I think AG Collins’ Opinion is so important – it’s a clear reminder that the law is still with us, it exists. And, of course, to say that “European values are not for sale,” which is why EU citizenship – a blood-based status – should not be sold, is a racist starting point out of place in the Union of the law.

EU citizenship is, by definition, free of any ethical content since the feudal principle of blood privilege distribution is not ethical. I have recently edited a book on this with Kristin Surak of LSE, with a handful of enlightening contributions – from Lior Erez to Suryapratim Roy – delving into this matter in detail.

What does this mean for the future of EU CBI?

Once the Court makes its final judgment, and if it favors Malta, the Commission will have to stop its hounding of citizenship by investment.

The Commission can’t keep using arguments that the Court has shot down, even though it has already lied repeatedly, misrepresenting Maltese CBI as at odds with EU values and attacking some candidate countries for no reason.

Professor J.H.H. Weiler – a towering authority on EU law – is absolutely correct on this matter; it is not Malta, but the Commission, in fact, which is in breach of EU values here. AG Collins confirms this standpoint.

The law is clear already now. However, once the Commission’s ethno-nationalist attack against EU values is dismissed, we can expect a strong growth of CBI offerings in Europe.

It is obvious that the Commission might still try to pressure EU candidate countries through other means. Rule of Law has never been a strong point in its pre-accession strategies for “preparing” candidates for membership.

In fact, quite the contrary has been true all along, which is why I usually speak of “the failure of conditionality” in the context of EU accessions.

So the Commission might say: “We know it’s not illegal, but we’d rather not see you open a CBI program if you want that EU funding or an accession promise.” This will put candidate countries in a difficult position.

The case against Malta reflects broader issues with how the EU approaches migration and citizenship, contradicting its supposed cosmopolitan ideals.

For the Commission, the law seems to be the law of the strong, not the law of good arguments and values that all member states have agreed to protect.

No questions are asked when France announces that Mr Durov, the founder of Telegram, is a French citizen or when Italy makes millions of new citizens in Latin America. And this is a good thing, of course.

What is distressing is that the Commission pedals double standards and that the assumption underpinning these has nothing to do with the law.

So, I expect this case to have significant implications for investment migration programs in the EU and candidate countries. More EU member states might follow Malta’s example, disregarding the Commission’s repugnant musings striving to solidify double standards and attack the smallest Member States in the name of tacit ethno-nationalism of “genuine links” the Court has already dismissed in the past.

The Union is better off as a result of stopping such abuse, and the Court now has a chance to repeat its earlier clarification of the law.

Once again, other states will be encouraged to create CBI programs of their own that suit their economy, having received a confirmation of what has been clear all along: That abuse of its political position by the Commission can be stopped by the Court of Justice safeguarding the Union based on non-discrimination on nationality and the principle of conferral.

Do you think Malta might revert to their previous model of citizenship by investment without a residency period after this ruling?

Malta has always had the confidence to run its citizenship program as it sees fit and in full compliance with the law. I am proud to have contributed expert advice to make the program a success.

The Commission outrageously made false claims about residency overlapping with physical presence: there is no such overlap in the EU.

Together with Martijn van den Brink, who has also brilliantly analyzed the AG Opinion recently, I’ve done research showing that most EU member states usually don’t require physical presence for residency and naturalization.

Legal residence is a right, not an obligation. By pretending to be lost and confused between the two, the Commission did not help its weak case.

It’s absurd to treat a right to inhabit a certain place as an obligation to be caged there. The Commission’s thinking reminds me of some confusing canons of Soviet Legal Theory, which knew “right obligations” and was unknown to contemporary Western legal tradition.

Malta’s concessions to the unlawful demands by the Commission at the start of the CBI program were already fully in line with the best practices: no need to pay attention to Brussels abuse. Malta offers an important service to the EU as a community of values by standing in the way of the Commission’s abuse of our law.

Do you think the EU’s attempt to use CBI as a reason to remove visa-free access will be affected by the court’s ruling, especially given the potential hypocrisy of doing so while CBI programs exist within the EU?

Yes, I think this will likely be affected. It’s indeed hypocritical for the EU to use CBI as a reason to remove visa-free access when we have CBI programs within the Union.

This hypocrisy will become even more apparent after the Court ruling, likely further legitimizing CBI programs.

Yet, visa-free access is a complex matter. We’ll need to see how the EU’s planned pre-travel vetting system will work with the holders of citizenships granted in the context of CBI programs. I believe there will be room for litigation if the EU applies discriminatory approaches.

It’s worth noting that many countries, including EU members, have exceptional routes to citizenship.

For example, some grant citizenship based on special talents or large investments, which is the same as CBI, only less transparent and murky. So, singling out CBI programs while ignoring these other routes doesn’t make sense from a policy perspective – it only makes sense in the fog of faux Eurowhiteness cosmopolitanism.

If the EU tries to discriminate against CBI passport holders but not against those who got citizenship through other exceptional means, it will be inconsistent and potentially illegal. This could open up significant legal challenges in the future.

What has your personal experience been like speaking out publicly on this issue?

When hitting a stupidity wall, like what I experienced, one learns a lot about the human condition.

I have no response to an ethics committee accusing me of having a leading monograph on citizenship released in a Russian translation – “The language of the mafia interested in buying citizenship” – and moving on to join a leading school cherishing academic freedom has been an immense contrast to that climate marked by bullying and censorship attempts.

However discouraging it has been to face absurdity, I could always appreciate the irony of the situation and tripled my efforts in engaging with the subjects of interest to me, especially investment migration.

There’s sometimes a clear right and wrong in the practice of the law, and we should be vocal about that. I stand by my position despite any personal attacks, and it is only right that AG Collins, for whom I have immense respect since his courageous service at the General Court, endorses key legal arguments I have been making all along.