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After 21 Months, No End in Sight for MM2H Suspension – Political Turf War to Blame, Say Insiders

Despite repeated assurances of an imminent reopening, Malaysia’s My Second Home (MM2H) program – until recently the world’s most popular golden visa – remains inactive 21 months after its initial “soft” suspension. Insiders say politicking is to blame.

Start, stop, start, stop

In September 2018, the government suspended the MM2H without providing an explanation. Three months later, the program reopened. Last week, however, privy sources told The Edge Markets the suspension had its origins in a dispute between the ministries of Home Affairs (MoHA) and of Tourism, Arts, and Culture (MoTAC). The squabble had reportedly arisen over the question of which of the two ministries should administer the program. MoTAC had taken over authority of the program in 2006, prior to which it was within MoHA’s remit.

Starting in April 2019, while MoTAC continued to operate the recently reopened program, all applications became subject to final review by MoHA’s Immigration Department, which introduced more stringent background checks. Elevated vetting standards, in turn, quickly led to a doubling of average processing times.

No justifications

Early last year, the MM2H Consultants Association (MM2HCA), whose 272 member firms account for the lion’s share of program application volume, reported that authorities had rejected nine out of ten applications filed between September and November 2019. MoTAC initially offered no justification for the unusually high rejection rates, which, in effect, amounted to an unofficial suspension.

In July 2020, MoTAC closed its MM2H office. News of the closure prompted the head of the country’s Immigration Department – which does not sort under MoTAC but under MohA – to convene a press conference wherein he announced the program would henceforth be administered by the Immigration Department.

Later the same day, MoTAC announced the program would begin a temporary hiatus. The government, said the Minister, would take advantage of COVID-related movement restrictions to “improve MM2H” and to “look into its activities and the processes involved”.

The Ministry further commented that “we’re targeting to get everything done by December. It’s not a permanent closure because the program contributes to our economy.”

In October 2020, three months after the program’s hiatus began (and nearly a year following the initial, unofficial suspension), Lim Kok Sai – President of the MM2H Agents Association (a separate, smaller advocacy group than MM2HCA) – said as many as 100 agents would be forced to close operations because of the ongoing moratorium.

December 2020 came and went without further updates from either MoTAC or MoHA.

In March this year, matters looked to be taking an optimistic turn when MoTAC announced it had received a report from the private consulting firm it had engaged to review the program and that a reopening was close at hand. “For us, [the report] looks OK,” said Minister of Tourism, Arts, and Culture, Datuk Seri Nancy Shukri. “God willing, we will bring this matter to the Cabinet, and, once it is approved, we can reactivate the program.” The Minister also said that she was working closely with the Immigration Department of MoHA to address questions of security.

Since March, neither of the two government ministries have made further announcements as to the program’s future.

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Residency status of MM2H participants questioned

When Malaysia first sealed its borders in March as a response to the pandemic, thousands of MM2H-participants were unable to return to their permanent homes in the country because they were not citizens. In May 2020, these were finally permitted to return to their homes, but only under strict conditions of quarantining and regular reporting to local authorities. Later in the year, MM2H holders were once more barred from entry.

“Our continued efforts to get the government to treat MM2H visa holders as legitimate residents of Malaysia, just as they do Malaysian citizens, has consistently fallen on deaf ears,” said Andy Davison – CEO of TEG Media, a firm that among other services provides MM2H advisory – in October last year.

“One thing is clear,” added Davison. “The MM2H program has suffered long-term damage, and not just because of COVID-19. It is now clear that the MM2H visa holders have no special residential privileges, and since there is no one in power fighting for the rights of MM2Hers, their status is weak.”

The decimation of an industry

One MM2H consultant, speaking to The Edge Markets, indicated he didn’t believe the program would reopen until Malaysia’s borders did as well.

“And when it resumes, I personally think it will be done in stages, with applicants from ‘green list’ countries being accepted first.”

Anthony Liew, President of MM2HCA, last week estimated that more than half of his organization’s 272 member firms are no longer operational and that those who have remained afloat have been able to do so only by shedding staff and offering downstream services to existing MM2H participants already in the country, such as by assisting with visa renewals.

“I can say that our income is now about 10% of what we earned previously,” lamented Liew.

He also estimated that between two and three thousand applications that had already received initial approvals by the time of the suspension still remain to be finalized.

“The applicants are not able to enter the country to do further endorsements because of the lockdown,” explained Liew. ” In fact, we are also waiting for them to come into the country to collect the balance of our fees,” he commented.

While MM2H is suspended at the Malaysian federal level, it remains open in Sarawak, a state of Malaysia on the island of Borneo that, thanks to constitutional provisions, exercises local autonomy in a number of policy areas, including on matters related to immigration.

Christian Henrik Nesheim AdministratorKeymaster

Christian Henrik Nesheim is the founder and editor of Investment Migration Insider, the #1 magazine – online or offline – for residency and citizenship by investment. He is an internationally recognized expert, speaker, documentary producer, and writer on the subject of investment migration, whose work is cited in the Economist, Bloomberg, Fortune, Forbes, Newsweek, and Business Insider. Norwegian by birth, Christian has spent the last 16 years in the United States, China, Spain, and Portugal.

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