When the EU Court of Justice ruled that Malta had failed to fulfil its EU membership obligations in allowing for naturalisation “in the absence of a genuine link of applicants with the country” earlier this year, states that are economically reliant on citizenship-by-investment programs took note.
The St Kitts and Nevis CIU has been putting non-refundable, donation-based public benefit option citizenship routes at the forefront of marketing initiatives, with similar initiatives also being publicised by other Caribbean citizenship by investment programs. These see investors contribute to affordable housing, education and infrastructure projects that have a demonstrable impact on local livelihoods.
Other Caribbean states with citizenship-by-investment programs offer similar options. For example, Antigua’s National Development Fund, finances projects under parliamentary oversight, and the University of the West Indies Fund, which finances the university’s fourth campus.
The Caribbean Five, along with 56 other non-member states, hold reciprocal short-stay visa waiver agreements with the EU for travel within the Schengen area, allowing their nationals, subject to certain verification requirements, to enter and stay in the Schengen zone for up to 90 days within an 180-day period. This visa-free access is important for economic citizens and natural citizens alike.
Developing an interpretation of citizenship-by-investment which is not merely, to quote the EU CJ decision on Malta’s program, “transactional” strengthens both an important alliance with the EU and the perceived value and stability of Caribbean Five citizenship.
Is visa-free access at risk?
Since 2023, the EU’s executive body, the European Commission, has been proposing a set of legislative measures that would allow member states to rescind visa waiver agreements on various new grounds, subject to agreement on a case-by-case basis.
These grounds, provisionally agreed upon in June of this year, include the operation of a citizenship-by-investment program.
Action already taken by the EU indicates that action in this direction mirrors existing policy priorities.
On 14 October, the UK government imposed a new visit visa requirement on nationals of Botswana, who were previously eligible for Electronic Travel Authorisation for travel to the UK, citing “a significant number of asylum claims since 2022” and associated operational pressures. Observers have noted that at just 329 in the period June 2024 to June 2025, the number of asylum claims made by Botswanan nationals in the UK was lower in the current year compared with the previous 12 months, stoking speculation that other factors may have played a role. Just three weeks before the UK’s announcement, Botswana announced that it would launch a citizenship-by-investment program as part of a policy to diversify the economy away from reliance on the diamond industry.
This mirrored a similar action taken in 2022, when the EU and UK both suspended Vanuatu’s visa-free access on the basis of its citizenship-by-investment program. In 2024, this suspension resulted in a revocation of visa-free access to both the UK and the Schengen Zone.
While it weighed heavily in the EU’s decision regarding the Maltese citizenship-by-investment program in its prior form, the absence of a “genuine link” between investor and the jurisdiction issuing citizenship was not a determining factor for the EU as regards lifting Schengen access for Vanuatu.
Instead, this decision was justified on security grounds, primarily on the basis of lax due diligence procedures and other applicability criteria, and on the basis that the program was “commercially promoted with the expressed purpose of granting visa-free access to the EU” to those who were otherwise ineligible by virtue of their original nationality.
Addressing the genuine link requirement
While these decisions were not driven by a concern relating to a genuine link requirement, the genuine link theme is increasingly rising to the fore both in EU literature on citizenship-by-investment programs and regulation relating to the lifting of visa-waiver agreements by member states and in discourse relating to the trickle-down impact of investment routes licensed by the programs.
The genuine link also features prominently in the draft regulation for the recently announced Eastern Caribbean Citizenship by Investment Regulatory Authority (EC CIRA).
This body, which will be headquartered in Grenada, was instated to provide regulatory consistency and independent oversight of program operation. Its drafting regulation paves the way for regional alignment of program governance standards, consistent acceptance and rejection criteria, and the harmonisation, independent audit, and oversight of due diligence practices.
The EC CIRA’s draft regulatory framework also lays out the first steps towards a genuine link in the form of a requirement for physical presence in the issuing jurisdiction – but not to the extent that investors would be expected to relocate.
Instead, the regulation introduces a requirement for physical presence amounting to a cumulative 30 days in the jurisdiction, over the first three years, ensuring biometrics can be collected locally, and the investor’s contribution to the local economy, at least in the form of its tertiary services, can be assured to populations whose livelihoods are already heavily dependent on tourism.
The EC CIRA’s foundational framework stipulates that the body may seek to proactively verify investment and residency declarations made by programs regarding their economic citizens.
Concurrent efforts by programs to emphasise the long-term impact of public-benefit and other donation-based investment options that further long-term economic sustainability in the jurisdiction can bolster the perception of a genuine link in both the eyes of the local public and international observers.
- Ensuring regulation and best practice integrity standards are well understood by decision makers within the program and program employees engaging with external parties – for example, by embedding clear compliance and remediation procedures and ensuring these are backed up by training and record keeping.
- Ensuring due diligence doesn’t stop at Applicants. International marketing agents and their third parties must also be subject to risk-based controls and minimum and ongoing due diligence requirements. Due diligence on these parties should focus on their financial integrity from a fraud and corruption perspective and on reviewing their marketing outreach to potential investors.
- Monitoring anti-competitive arrangements between different counterparties in the investment lifecycle. Watching out for conflicts of interest between investors, intermediaries, developers and any parties whose income or revenue derives from the program or an investment option licensed under it is essential to build and maintain local and international trust in programs.
- Strengthening and monitoring internal compliance processes and systems to ensure they are fit for purpose to address emerging risks in the investment migration sector – for example, implementing new regional regulatory recommendations to ensure oversight over the licensing of new projects, or by building and implementing whistleblowing mechanisms for all stakeholders to enable risk indicators to be proactively recognised and reactively investigated in line with clearly defined risk matrixes and policy priorities.
Safeguarding programs by investing in governance
Programs must build and embed long lasting governance controls into their program administration procedures.
While applicant due diligence sits at the forefront of these practices, this should not be considered in isolation from other broader governance mechanisms:
Local perceptions matter
Citizenship-by-investment doesn’t exist in a political and social vacuum. The rising prominence of anti-migration sentiment in Europe, and seismic immigration policy shifts in the US, creates an environment in which investment migration can easily be questioned, especially where data is not readily available, or policy objectives are unclear. This underlines the need for programs to take local opinions seriously and engage in public consultations and communication about the short-, mid-, and longer-term goals of programs, and the projected impact of investment projects.
Considering emigration dynamics is also important when assessing citizenship-by-investment programs and their reception by local populations. Consistently successful programs aimed to attract investment in healthcare, education, tech and creative industries have the potential to counter brain-drain dynamics across the region, as well as provide opportunities for the migration of skilled workers from other countries in the region.
What might a future genuine link look like?
Aside from the physical presence requirement, the EC CIRA regulation introduces the concept, which is yet to be fully developed in law, of a mandatory integration program for investors, to include civic education and cultural orientations and/or community engagement requirements. This complements the live online interview requirement which was introduced by the Caribbean Five in late 2023.
Efforts to engage a more cohesive connection with existing and potential investors can also include engaging with initiatives launched by, or partnering with, the diaspora.
World Bank and IOM figures highlight the material impact of the first- and second-generation Caribbean diaspora, indicating that a large proportion remain economically active in their home countries, particularly as regards property ownership.
Creating environmentally and economically sustainable investment options also demonstrates to local populations that programs can further a long-term and mutually beneficial vision for the state in which the investor is acquiring citizenship.
When effectively implemented, renewable energy projects resonate far further than traditional tourism-based investment routes on a global stage. The Caribbean Five are members of the UN-designated Small Island Developing States (SIDS), which are particularly prominent in UN CoPs.
Investment options that build in green options are also important in aligning stakeholder expectations. Local populations in the Eastern Caribbean are heavily aware of their vulnerability, both to sudden-onset disasters like hurricanes and floods, and slow-onset events, such as land degradation and rising sea levels – particularly given the coast-based nature of commercial activities in the Caribbean Five. These risks are exacerbated by physical infrastructure constraints that require capital to resolve. Flood defences are increasingly critical, while suboptimal road and maritime networks make emergency aid harder to deliver.
While still in their infancy, green investment options for citizenship applicants are being scoped out by programs, both in the form of eco-tourism projects that contribute to initiatives that preserve and restore coral reefs, and large-scale economic pivot projects, such as the geothermal initiatives being explored in Dominica and Nevis.
Ensuring sustained and inclusive development in geographically small, tourism-dependent and climate vulnerable nations is not easy, and citizenship-by-investment can only ever be one of various sources of capital.
That said, with increasing oversight from the EC CIRA, the support of internationally recognised auditors, investigators and recognised third-party due diligence and monitoring providers, investment priorities can be better mapped to longer-term economic priorities, which in turn have a greater trickle-down impact for local populations.