Proposal for a COUNCIL DECISION on the partial suspension of the application of the Agreement between the European Union and the Republic of Vanuatu on the short-stay visa waiver
Date: 2022-01-12
Institutions: Directorate-General for Migration and Home Affairs, European Commission
Subjects: EU visa policy, Schengen Agreement, Vanuatu, agreement (EU), external border of the EU, foreign national, revision of an agreement

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   EUROPEAN COMMISSION  Brussels, 12.1.2022  COM(2022) 6 final 2022/0001 (NLE)  Proposal for a COUNCIL DECISION on the partial suspension of the application of the Agreement between the European Union and the Republic of Vanuatu on the short-stay visa waiver  
 
EXPLANATORY MEMORANDUM 

The  Commission's  report  on  investor  citizenship  and  residence  schemes  in  the  European 
Union  of  January  20191  highlighted  concerns  about  such  schemes,  in  particular  as  regards 
security,  infiltration  of  organised  crime,  money  laundering,  the  financing  of  terrorism,  tax 
evasion and corruption. It also warned that, when run by countries enjoying visa-free access 
to the Union, investor citizenship schemes could be used to circumvent the regular Schengen 
visa procedure and the in-depth risk assessment it entails2. 

A  Visa  Waiver  Agreement  between  the  EU  and  Vanuatu3  applies  since  2015.  Before  2015, 
Vanuatu ran only one investor citizenship scheme, under which a limited number of passports 
were  issued4.  However,  since  2015,  Vanuatu  has  established  additional  investor  citizenship 
schemes and the number of successful applicants has increased significantly. According to the 
authorities  of  Vanuatu,  two  schemes  are  currently  operational:  the  Vanuatu  Contribution 
Program and the Development Support Program. By March 2021, Vanuatu had issued over 10 
500  passports  under  its  investor  citizenships  schemes5.  In  April  2021,  the  Parliament  of 
Vanuatu approved a new citizenship scheme which is not yet operational6. 

In 2017, the Commission started investigating the Vanuatu schemes, since these raised serious 
doubts,  in  particular  on  account  of  their  security  failures.  The  Commission  also  warned  the 
Vanuatu  authorities  about  the  suspension  possibilities  contained  in  the  Agreement.  Also  in 
2017,  the  Commission  requested  information  from  the  Vanuatu  authorities  on  the 
management of the schemes, in particular  as regards the security screening of applicants. In 
2018,  the  Commission  received  assurances  from  the  Government  of  Vanuatu  regarding  the 
security screening procedures, stating that these procedures included checks against Interpol 
databases. 

At the fifth Enhanced Political Dialogue between the EU and Vanuatu of 15 April 2019, the 
EU reiterated its concerns with regard to Vanuatu's citizen by investment schemes, noting that 
it  could  have  an  impact  on  the  Visa  Waiver  Agreement.  The  EU  clarified  that,  while 
naturalisation  procedures  are  Vanuatu's  sovereign  decision,  very  strict  security  background 
checks are essential to prevent any abuse. 

In  July  2019,  it  came  to  the  Commission's  attention  that  applicants  had  been  granted 
citizenship  under  Vanuatu's  investor  citizenship  schemes  despite  being  listed  in  Interpol's 
databases  and  that  some  applicants  had  presented  forged  documents  (in  particular  forged 
clean criminal records) that the authorities of Vanuatu failed to detect. 

The Commission sent letters to the authorities of Vanuatu asking for further information on 
the  schemes,  the  security  screening  and  the  granting  of  nationality  to  applicants  listed  in 
Interpol watch lists, again warning of the possibility of suspension of the visa exemption7. 

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COM(2019) 12 final. 
p. 22-24. 
Agreement between the European Union and the Republic of Vanuatu on the short-stay visa waiver (OJ 
L173, 3.7.2015, p. 48). 
According to the information provided by Vanuatu's authorities, 93 passports were issued between 2014 
and 2015 under the Capital Investment Immigration Program (CIIP). 
Information provided by Vanuatu's Passport Office on 14 June 2021. 
Information provided by the EU Delegation on 17 June 2021. 
Letters sent from the Commission to Vanuatu on 15 November 2019 and on 18 June 2020. 

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At the sixth Enhanced Political Dialogue between the EU and Vanuatu on 21 April 2021, the 
EU  referred  again  to  the  potential  impact  of  Vanuatu's  investor  citizenship  schemes  on  the 
Visa  Waiver  Agreement  and  strongly  recommended  that  Vanuatu  immediately  address 
possible risks of infiltration of organised crime, money laundering, tax evasion and corruption 
associated with such schemes. At this Political Dialogue, Vanuatu expressed its commitment 
to  implementing  reforms  in  order  to  address  these  concerns,  such  as  close  cooperation  with 
various stakeholders - in particular its Financial Intelligence Unit – or the amendment of the 
Passport Act. However, in April 2021 the Government of Vanuatu took further steps to set up 
a new citizenship program. 

Based on the information received from Vanuatu, the Commission concluded that its investor 
schemes present  serious  deficiencies and security failures that have the potential to  create  a 
risk to the internal security of the EU and its Member States. In particular, the average time 
taken to process the applications is too short to allow for a thorough screening and there is no 
systematic  exchange  of  information  with  the  applicants'  country  of  origin  or  main  past 
residence  before  citizenship  is  granted.  In  addition,  there  are  no  requirements  for  physical 
residence  or  presence  in  Vanuatu.  The  absence  of  a  physical  interview  requirement  raises 
additional doubts as to the reliability of the security screening, as it reduces the opportunities 
for  the  authorities  to  corroborate  the  information  provided  in  the  application,  including  its 
veracity and credibility. 

The available data also raise concerns in terms of the extent of the schemes, the rejection rate 
and the nationalities of origin: 

First, the number of successful applicants (more than 10 500 citizenships granted in exchange 
for investment between 2013 and 2021, according to Vanuatu’s Passport Office) is very high. 

Secondly,  the  rejection  rate  is  extremely  low.  Based  on  the  available  information,  only  one 
application had been rejected until 20208. This raises further doubts as to the reliability of the 
security and due diligence screening. 

Thirdly,  the  countries  of  origin  of  successful  applicants  include  some  that  are  typically 
excluded from  other  citizenship schemes, such as  Iran and  Afghanistan,  and  other countries 
whose  nationals  require  a  visa  for  short  stays  in  the  EU,  including  Nigeria,  Yemen,  Syria, 
Pakistan and Libya. 

As a result, the schemes that Vanuatu has established since 2015 allow visa-required nationals 
to  bypass  the  regular  Schengen  visa  procedure  and  the  in-depth  assessment  of  individual 
migratory and security  risks it entails. Vanuatu's  investor  citizenship schemes  do not ensure 
the high level of security referred to in the Commission's 2019 report on investor citizenship 
and residence schemes9. 

Finally, the schemes established since 2015 have been promoted commercially  as providing 
visa-free  access  to  the  EU,  although  the  Visa  Waiver  Agreement  is  not  aimed  at  enabling 
third-country nationals  who are required to be in possession of a visa to travel to the EU to 
circumvent such requirement by acquiring citizenship of Vanuatu. While the EU respects the 
right of sovereign countries to decide on their own naturalisation procedures, visa-free access 
to  the Union should not be used as a tool for leveraging individual investment  in  return for 
citizenship. 

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Information provided by Vanuatu's Passport Office on 22 September 2020. 
COM(2019) 12 final. 

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The  Agreement  can  be  suspended  in  whole  or  in  part  for  reasons  of  public  policy  or  the 
protection of national security10. 

In this context,  the Commission  considers that  the investor schemes in  place in  Vanuatu  go 
against the objectives of the EU visa policy and of the distinction that is made, in Regulation 
2018/180611, between third countries whose nationals are subject to the visa requirement and 
third countries whose nationals are not subject to such a requirement, which is determined by 
the EU on the basis of a case by case assessment of a variety of criteria relating inter alia to 
security.  Such  schemes  give  to  third-country  nationals,  who  would  be  visa-required  if  they 
had not  obtained Vanuatu's citizenship, the possibility to travel  to the EU visa-free, without 
going through the security vetting before their arrival at the external borders required by the 
Schengen visa procedure. 

In light of the above, a partial and proportionate suspension of the Visa Waiver Agreement is 
justified in  order to  mitigate the impact  of the investor citizenship schemes  on the visa-free 
regime between the EU and Vanuatu. Considering that it will not be possible in practice for 
Member  States'  border  guards  to  determine  whether  an  ordinary  passport  has  been  issued 
through  an  investor  scheme,  the  suspension  of  the  Agreement  should  cover  all  ordinary 
passports  issued  since  25  May  2015,  when  Vanuatu  started  issuing  a  substantial  number  of 
passports in exchange for investment. 

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Article 8(4) of the Visa Waiver Agreement between the European Union and Vanuatu, cited above. 
Regulation  (EU)  2018/1806  of  the  European  Parliament  and  of  the  Council  of  14  November  2018 
listing  the  third  countries  whose  nationals  must  be  in  possession  of  visas  when  crossing  the  external 
borders and those whose nationals are exempt from that requirement (OJ L 303, 28.11.2018, p. 39). 

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2022/0001 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the partial suspension of the application of the Agreement between the European 
Union and the Republic of Vanuatu on the short-stay visa waiver 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 77(2)(a) thereof, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 218(9) thereof, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

The  Agreement  between  the  European  Union  and  the  Republic  of  Vanuatu  (‘the 
parties’) on the short-stay  visa waiver1 (‘the Agreement’) was concluded  on 28 May 
20152 to facilitate travel to the Union for citizens of Vanuatu and the travel of citizens 
of the Union to Vanuatu. 

The Agreement is based on the parties' common desire to encourage people-to-people 
contacts, boost tourism and invigorate business between the Union and Vanuatu. 

Under Article 8(4) of the Agreement, either party may suspend in whole or in part the 
Agreement,  in  particular  for  reasons  of  public  policy  and  the  protection  of  national 
security. The decision on suspension is to be notified to the other party no later than 2 
months  before  its  planned  entry  into  force.  Should  the  reasons  for  that  suspension 
cease to exist, the party that has suspended the Agreement is to inform the other party 
immediately and to lift the suspension. 

Vanuatu  operates  investor  citizenship  schemes,  whereby  it  has  granted  Vanuatu 
nationality  to  nationals  of  other  countries  with  no  previous  connection  to  Vanuatu, 
issuing  positive  decisions  on  the  vast  majority  of  applications.  Until  March  2021,  it 
issued over 10 500 passports with an extremely low rejection rate.3 This raises doubts 
as  to  the  reliability  of  the  security  and  due  diligence  screening  carried  out  by  the 
Vanuatu authorities. 

In  exchanges  in  October  2017,  November  2019,  June  2020  and  March  2021,  the 
Commission expressed serious concerns and warned the government of Vanuatu of the 
possibility  of  the  visa  requirement  being  reinstated.  The  explanations  provided  by 
Vanuatu were not sufficient to mitigate those concerns. 

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OJ L 173, 3.7.2015, p. 48. 
Council  Decision  (EU)  2016/272  of  12  February  2016  on  the  conclusion,  on  behalf  of  the  European 
Union, of the Agreement between the European Union and the Republic of Vanuatu on the short-stay 
visa waiver (OJ L 52, 27.2.2016, p. 11). 
Information provided by Vanuatu's Passport Office on 14 June 2021. 

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(6) 

(7) 

(8) 

(9) 

The  granting  of  citizenship  to  applicants  listed  in  Interpol  databases  contradicts 
previous assurances by the Vanuatu authorities regarding security screening and raises 
further concerns as to the reliability of the schemes' security screening procedures. 

The  successful  applicants'  nationalities  of  origin  who  have  been  granted  Vanuatu 
nationality  include  several  countries  whose  nationals  must  be  in  possession  of  visas 
when  crossing  the  external  borders  of  the  Union.  Furthermore,  the  Commission  has 
raised concerns regarding the absence of physical presence or residence requirements, 
the  schemes’  short  processing  periods  and  the  lack  of  systematic  exchange  of 
information  with  applicants'  countries of origin  or main past  residence of applicants. 
The  Commission  came  to  the  conclusion  that  the  screening  of  applications  for  the 
investor citizenship schemes in Vanuatu does not guarantee a high level of security. 

The suspension of the Agreement should be limited to ordinary passports issued as of 
25  May  2015,  when  the  number  of  successful  applicants  under  Vanuatu's  investor 
citizenship schemes started to increase significantly. 

Therefore,  the  application  of  the  Agreement  with  regard  to  all  citizens  of  Vanuatu 
holding  an  ordinary  passport  issued  by  Vanuatu  as  of  25  May  2015  should  be 
suspended. 

(10)  This Decision constitutes a development of the provisions of the Schengen  acquis in 
which Ireland does not take part, in accordance with Council Decision 2002/192/EC4; 
Ireland is therefore not taking part in the adoption of this Decision and is not bound by 
it or subject to its application.  

HAS ADOPTED THIS DECISION:  

The Agreement between the European Union and the Republic of Vanuatu on the short-stay 
visa  waiver  is  suspended  for  citizens  of  Vanuatu  holding  ordinary  passports  issued  by 
Vanuatu as of 25 May 2015. 

Article 1 

Article 2 

This Decision shall enter into force on [two months after the publication – OP please insert a 
specific date]. 

Done at Brussels, 

For the Council 
The President 

4 

Council Decision 2002/192/EC of 28 February 2002 concerning Ireland’s request to take part in some of the 
provisions of the Schengen acquis (OJ L 64, 7.3.2002, p. 20). 

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