A PROPOSAL FOR A MALTA START-UP VISA PROGRAM
4 minute read –
The Third Pillar In Malta's Investment Migration Portfolio
In an effort to attract additional foreign direct investment and human capital, many countries have created an iteration of a residence program whereby residence is granted on the basis of making an investment in a start-up. Such programs tend to be interchangeably called Entrepreneur visa, Start-up Visa or Investor Visa – but regardless of the chosen name, the concept remains largely similar.
An investor is encouraged to invest in a new, or existing start-up, and in return the nation grants a residence permit to the investor. France has ‘La French Tech‘, or the French Tech Visa, the UK has the Start-up Visa, which may be progressed to the Innovator Visa, Italy, Latvia, Ireland, Denmark, and many others have such programs.
One country, which does not yet have a start-up visa program is Malta. Which is strange, because Malta has been somewhat of a leader in this field, with two very successful programs – the Malta Individual Investor Program, which is considered by many as the gold standard of citizenship by investment programs, and the Malta Residence and Visa Program.
Both programs have delivered great results for the country, with the MIIP alone having successfully processed 1,198 applications by June 2019 – which at the very least, will have generated EUR 778 Million in government contributions and EUR 179 Million in investment in Government bonds or instruments on the Malta stock exchange.
However, an attribute that both the MIIP and the MRVP have in common is that a portion of the investment is directed towards real estate. Unquestionably, this was – and still is – very well received by landlords, developers, real estate agents, and property management service providers, but this is still somewhat limited in vision and opportunity.
In October 2019, CIVIQUO, started lobbying the idea of a Malta Start-up Visa Program to the Maltese government, as a third pillar to the nation’s investment migration portfolio. A Start-up visa program for Malta would be an ideal solution for many reasons.
Apart from the obvious effect of facilitating funding for start-ups, a Malta Start-up Visa Program would diversify the local investor profile giving local start-ups access to alternative insights and experience, from investors with a different mindset, cultural background and with a much more global flavour. Inevitably, this would generate a ripple effect as with investors, come angel investor-networks, followed by VCs, funds, business incubators and business accelerators.
During the times of COVID-19, putting in place a foreign direct investment program, which channels funding directly to front-line businesses – especially innovative businesses – helps the economy to maintain momentum by generating jobs, innovative products and services, and creating a dynamic environment which attracts even more entrepreneurs and investors.
CIVIQUO’s proposal explains how the Malta Start-up Visa Program, could be a three-year residence permit, which could be renewed for a further two years, after which applicants may be eligible to apply for long term residence.
Coronavirus has taken away many businesses from many entrepreneurs from across the globe, and a number of individuals are considering whether to start again, whilst remaining in the country where they are currently located, or take the opportunity to relocate to a country which may offer better access to business opportunities, advantageous taxation, excellent healthcare and educational institutions and maybe, even a great lifestyle – and Malta spectacularly fits such a description.
With a pre-determined framework, of how the minimum investment required would be disbursed, the Malta Start-up Visa Program would provide a stable financial input to the local start-up economy, together with giving a much needed platform to Maltese Entrepreneurs to interact with more experienced Entrepreneurs from other parts of the globe, thus tapping into previously inaccessible networks.
Implementing a program such as the Malta Start-up Visa Program is an excellent opportunity for the Maltese government, to consolidate its immigration policy of citizenship by investment, and permanent residence by investment, with the third pillar being a start-up-focused temporary residence visa.
A program like the Malta Start-up Visa Program is also a fantastic opportunity for university students to participate in research which is then developed into a start-up business. This serves as an excellent bridge between education and work as it provides students who may have participated in the academic research of a project, to eventually become a founding member of a business, based on that very same research.
It also has the potential to create a more diverse portfolio of FDI, which is not limited to real estate or stock exchange instruments, but which also incorporates upcoming businesses which with the right financing and direction, could put Malta firmly on the map for being the most innovative and entrepreneurial EU member state, which not only preaches cultural diversity, but leverages it and weaves it into the very fabric of its economy.
Such a program, also helps to bridge the gap between Malta and the EU, in regards to residence and citizenship by investment, especially since in a recent public consultation survey, the European Commission suggested that it may be considering harmonising at EU level the admission and rights of third-country entrepreneurs, and to promote the founding of start-up companies by third-country entrepreneurs – what better way for Malta to show that it aligns with the EU’s views on this, and pro-actively implement such a program.