Many readers of The Shift will already be sympathetic to Ursula von der Leyen’s criticism of Malta’s passport sales. But unless we pay attention to Malta’s counter-argument, made by the minister for citizenship, Alex Muscat, we won’t see just how damaging selling passports is to Malta’s national interest.

It’s because he’s right on a matter of principle that the Labour government is so wrong about continuing this practice.

Muscat says there’s a principle at stake over whether passport sales should continue. No, three principles are in play, not one.

First, there’s the principle of ‘sincere cooperation’ by EU member states, which is enshrined in the EU treaties. The European Commission last year initiated infringement procedures against Malta (and Cyprus), saying that the passport schemes are, well, scheming: not sincere in intent and not cooperative in effect.

Cyprus has since scrapped the scheme, over corruption allegations, and said it will not be replaced.

That leaves Malta, whose scheme is called by the hypocritical euphemism of ‘citizenship by investment’. It has repeatedly been shown to be a sham: lax in vetting, lax in enforcement of conditions, lax in monitoring.

The Commission’s case is legally still to be tested but its political case is irrefutable. Malta is selling passports whose value comes from giving access to, and rights in, the rest of the EU. We’re not selling something that belongs to us alone. It’s making a commodity out of European freedoms and fundamental rights.

Which brings us to the second principle: should Maltese citizenship — even from a purely national perspective — be put up for sale on the market? Is citizenship a commodity like a designer suit? Or is it more like a kidney, which can be donated, or like a certificate of merit, which can be awarded, though neither should legally be bought or sold?

Good sense says that citizenship should not be bigoted — based on ‘blood’ alone. Anyone from anywhere should, in principle, be able to qualify. The question concerns qualifications.

Citizenship gives rights to participate in political decisions over what’s best for Malta as a whole; so the qualification should be a strong enough link to the country to tie your own destiny to the collective one. Long-term residency, family ties, real substantial contributions — all these traditional criteria amount to a package of personal investment, interests, stakes and love.

With that kind of background, we may still disagree on what’s best for Malta’s future, but there will be little room to doubt each other’s sincerity.

If citizenship can be bought, however, we’re essentially selling political rights to people with the power to buy our politicians, and who will have little reason to see the country other than as an instrument for their private purposes. We sell citizenship at the peril of our democratic form of life.

Finally, there’s the principle Muscat insists on: the right of a nation-state — even if it’s an EU member — to confer citizenship on whomever it wants to.

He’s right. That is a principle we should defend. If that changes, something more than the specific right to confer citizenship will have been lost. The general right of subsidiarity will have been eroded just a little more; power would have been centralised in Brussels more than it should be.

It is in Malta’s general interest — economic and cultural, as much as political — that the EU remains a union of nation-states, rather than become more like a super-state with regions. We should robustly defend our areas of national competence.

But it imperils this principle to fight a battle over a scheme as obviously corrupt as passport sales. Selling citizenship is a corrupt form of conferring citizenship. It corrupts its value.

Then the scheme itself is corrupt in how it’s actually handled. It’s corrupt in its effect on the economy — hooking us to a temporary income from one-off sales (so that even the Opposition is reluctant to say it will scrap it) while damaging our relationship with our closest allies and economic partners.

Passport sales are a grey area, legally, for good reason. As a matter of prudence, some areas of overlapping competence are best left to practical negotiations and good will. The principle of ‘sincere cooperation’ serves to preserve member states’ autonomy while urging compromise.

It was not envisioned that national competence would be seen as a loophole to exploit selling European citizenship, under the pretext that technically it’s a Maltese passport. If a member state is going play dirty, so will the European institutions.

Our passport sales truly do endanger European values; the Commission will find a way to stop them. If it fails legally, a political path will eventually be found to squeeze Malta into dropping the scheme. In addition to getting its way, the Commission will then have set a precedent for future power grabs.

Cyprus did the right thing. It found a reason for dropping the scheme, giving national reasons, without budging on the principle of national competence.

The Labour government thinks it’s flying the sovereignty flag. In fact, it’s undermining sovereignty — in line with Joseph Muscat’s legacy.