The Ongoing Obligations of Agents: Do Obligations follow the Agent After a Passport is Issued?

Author: Ann Bugeja

The Citizenship for Exceptional Services Programme is a highly regulated mechanism currently enabling foreign nationals to acquire Maltese citizenship through investment. This process is facilitated by the engaged licensed agent, who acts as the primary intermediary between Maltese authorities and the applicant. The regulatory framework applicable to this programme also binds licensed agents in terms of their qualifications, functions, conduct and duties.  Nevertheless, the relevant instruments are rather unclear as to the extent to which these duties and functions apply in relation to applicants whom licensed agent would have assisted after they obtain a Maltese passport.

The primary duty attached to the licenced agent is a five-year rule binding the agent to cooperate with Aġenzija Komunità Malta (the ‘Agency’) in their monitoring efforts after a Maltese passport is issued. This duty is complementary to the applicant’s obligation to continue observing and fulfilling material obligations at least for five years following the issue of the certificate of naturalisation, subject to deprivation of citizenship in case of a breach. Parallelly, the law binds the licensed agent to report any material breach or fraud on the part of any applicant, any false, misleading or materially inaccurate information provided to the Agency as well as any material information not provided to the Agency. The licensed agent should notify the Agency immediately upon becoming aware of any of the mentioned instances. This obligation remains binding throughout a five-year period which starts to lapse immediately on the oath of allegiance being taken by the applicant for which one is acting as an agent.

In addition to this, the licensed agent is also bound by several obligations which may be interpreted to be binding irrespective of the progress of the application itself in absence of any express limitation stating otherwise. For instance, the Agents (Licenses) Regulations (Subsidiary Legislation 188.05) requires an agent to advise and guide an applicant on all matters relating to the application, provide information and explanations to the Agency without delay and act as an intermediary between the applicant and Agency on all matters relating to the application.

The importance of being aware and satisfying these duties is crucial, in view of the substantial penalties applying. Under the applicable framework, the strongest penalty is the Agency’s power to initiate investigations leading to the possibility of suspension or revocation of an agent’s license.  However, the Licence Agreement and Code of Conduct and Ethics for Agents extends the power of the Agency to impose penalties to incorporate ‘any measures it deems fit in the circumstances with respect to the Agent concerned’, widening the possible penalties encumbering an agent.  This procedure is triggered whenever there is unethical or unprofessional conduct to the prejudice of the applicable Regulations or whenever the Agent has committed a serious breach of guidelines, codes of conduct or codes of ethics issued by the Agency from time to time and made specifically applicable to Agents. This includes breaches or non-fulfilment of the obligations outlined in respect of an applicant after a passport has been granted. In addition to this, the Maltese Citizenship Act under which the Citizenship for Exceptional Services programme is established sets out a penalty for failure to comply with any requirements imposed upon agents or any other individual by regulations made under the Act in relation to certificates of naturalisation or certificates of registration.

One observation is that there has been a substantial improvement in the regularisation of the agent’s obligations. This comes across more clearly when compared to the provisions available under the Malta Individual Investor Programme which are generally more limited when it comes to the duties and obligations of an approved agent and which set out a less rigorous penalty mechanism. Contrastingly, following a detailed look into the regulating framework for the Citizenship for Exceptional Services, there are several functions and obligations which do not cease on the application process for a Maltese passport being completed. Nonetheless, this framework still leaves much to be desired in terms of the extent to which obligations are applicable beyond applicants being granted a passport, seeing as to date this is mostly dependant on legal interpretation.