Macbridge owner Cheng Chen had Malta visa deal in the bag

The Chinese negotiator in multi-million euro deals by Enemalta, Cheng Chen, directly influenced Malta’s residence visa programme (MRVP) in the months prior to an open market call for concessionaires, which his company Shanghai OC secured.

Chen was last week revealed by a Times-Reuters investigation to be behind the secret company Macbridge, suspected of being set up to pay kickbacks to Keith Schembri and Konrad Mizzi. 

MaltaToday has learnt that Cheng Chen was aware immediately of government plans to launch the MRVP, a visa residency scheme for high net-worth individuals who were unable to apply for the Individual Investor Programme due to dual citizenship prohibition in their country of origin.

From March 2015, right until the MRVP’s tendering process later on in September that year, Cheng Chen and his associate ‘Kevin’ Haibin Mao were in constant contact with staff in Konrad Mizzi’s ministry for energy.

Despite the MRVP having been passed off as a programme under Chris Cardona’s ministry of the economy, the programme’s entire design was hammered out under Mizzi’s aegis.

Communications and documents seen by MaltaToday show that Cheng Chen – an Accenture employee who in 2014 negotiated on behalf of Shanghai Electric Power for its acquisition of a stake in Malta’s power company Enemalta – took an active role in trying to influence the MRVP and how it would be shaped.

Having already had unfettered access to Castille during the SEP-Enemalta negotiation in 2014, Chen had insider knowledge of the MRVP and badgered ministry staff on changes to the prospective visa programme.

Specifically, he made brazen representations on behalf of Shanghai Overseas Chinese Exit-Entry Service Co. Ltd (referred to as Shanghai OC) because he was aware it would be the exclusive concessionaire for the Far East region.

The concession had been regulated by the Concession Review Board regulations, a board set up in 2015, apportioning the MRVP’s exclusivity to regional concessionaires: Shanghai OC for China, Hong Kong and Macao; Discus Holdings for Russia and Turkey; Henley & Partners for South Africa, and Nexia BT for the Middle East.

But Cheng Chen’s communications to Mizzi’s ministry were indicative that he knew his company had already been guaranteed the concession, even though the MRVP’s call for concessionaries had to be put to market. Months before the finalisation of the MRVP, Chen would fire off detailed instructions on how the programme should be designed to attract Chinese clients.

In March 2015, Chen made representations so that Shanghai OC would receive a €35,000 promoter fee for each successful application it sourced from China. The fee was later reduced to €10,000 on insistence of government staff.

Chen sent working plans he created himself in the form of timelines for a promotional campaign that Shanghai OC would create for the MRVP, earmarking a May 2015 event for prospective applicants.

He also sent proposed changes to the forthcoming legal notice in red.

He also showed the ministry a draft cooperation agreement he had with BTI Management Limited, a company owned by Nexia BT auditors Brian Tonna and Karl Cini, in which BTI would serve as an authorised mandatory for Shanghai OC to handle corporate filings and MRVP applications in Malta.

Chen’s associate Kevin Mao made further representations to ministry staff, indicating they had long been aware of the MRVP’s eventual issue. “We have been engaged in the preparation for this project in the past months,” Mao wrote.

When government staff lowered the concession fee to €10,000 and prolonged the publication of the rules, in a bid to bring on the Opposition to agree with the MRVP, Mao complained that his company had lost out on potential 2015 sales:

“Actually, the regulations were supposed to be released by the end of April, but now it is almost two months late than the scheduled plan. Therefore, we have missed the best sales season due to the delay of the regulations...”

Mao made several demands, kicking back against changes to the MRVP made by government employees. “Can the repayment of marketing and processing fees be changed back to flat rate scenario (€35,000 + €5,000)? As the golden months for sales have been passed... we have to double marketing expense... We hope that the Malta government can sign the document in one week with us when the regulations release [sic].”

Last week, The Times revealed that Chen is a partner with Mao in another company Shanghai Visabao Network Technology. Mao is separately partnered with Mizzi’s long-time lawyer Aron Mifsud Bonnici in Asiatica Corporate Services, which provides corporate services to MRVP applicants.

It is now pending liquidation.

Mifsud Bonnici was appointed by Mizzi as secretary to the Enemalta board. He has said he knew Chen from his capacity as advisor to Shanghai Electric Power. “I had met him some time into my tenure as Enemalta board secretary.” 

What is the MRVP? 

The residency and visa programme, launched in 2015, was intended to attract wealthy foreigners to invest in Malta in return for a residence permit and visa-free access to the Schengen Zone. It is a separate scheme from the Individual Investment Programme, that offers Maltese citizenship to wealthy investors.

Applicants must purchase property in Malta worth at least €320,000, or €270,000 if it is in the south of the island or in Gozo. They must also commit to a qualifying investment worth at least €250,000 which must be held for at least five years, pay a €30,000 contribution fee, and file an affidavit proving that their annual income stands at €100,000 or that they hold a minimum capital of €500,000.

The audit firm thrust into the limelight of the Panama Papers – Nexia BT – was also one of the concessionaries paid €10,000 for each successful applicant under the MRVP as official concessionaire for the Middle East.

In August 2016, the audit firm was made a concessionaire following a public competition launched back in November 2015. The concession was regulated under the Concession Review Board regulations, a board set up in 2015 to rule on complaints against concessions granted by ministers to private companies.