After several top executives were given local citizenship under a controversial scheme, casino operator Melco Resorts & Entertainment (MRE) is under fire in Cyprus.
An investigation by broadcaster Al Jazeera reported in August that 18 Melco Investment Holdings executives filed a joint application for citizenship under the Cyprus Investment Program (CIP) in July 2019.
By ploughing at least EUR 2.5 million into local development projects, the CIP has enabled wealthy foreigners to acquire Cypriot citizenship. The Cypriot government announced earlier this month, following an Al Jazeera broadcast on the subject, that it would terminate the CIP effective November 1.
Under its Cyprus Casinos offshoot, MRE is currently running three satellite casinos and a ‘temporary’ larger casino in Limassol. The company continues to build the EUR 550 m integrated City of Dreams Mediterranean resort, which was originally expected to open in late 2021, but it is anticipated that pandemic-related development delays will push this launch to 2022.
Apparently, the 18 Melco directors and their families were able to circumvent the requirement for CIP applicants to hold residency permits for at least six months prior to their submission. Applicants are also expected to buy €500k worth of homes and pay local tax of €100k for three years, but three years have not elapsed between Melco securing the sole Cyprus casino licence and the passport award in July 2019.
A statement was released by Melco claiming that it had behaved entirely appropriately in compliance with the rules of the CIP, but this week Cyprus Auditor General Odysseas Michaelides said his office is investigating the mechanism by which the Melco-related applications were rapidly monitored.
Michaelides slammed the government on Saturday for refusing to turn over the cabinet decision documents that fast-tracked the Melco application. Attorney General Giorgo Savvides fought back, releasing a statement saying that his office “is the guardian of the constitution and the laws” and “should be allowed to continue its work without.”
The European Commission (EC) reported this week that it had opened violation proceedings against Cyprus and Malta in respect of their respective ‘golden passport’ regimes. The EC notes that the granting of citizenship in this way “undermines the integrity of the status of European Union] citizenship.” and has given the governments of both countries two months to react.