Vanuatu Agrees to Distinguish Investor Citizens in New Pact With Australia

Vanuatu has committed to establishing mechanisms that distinguish citizenship by investment (CBI) from other forms of citizenship. That undertaking appears in Article 6 of the Nakamal Agreement, a ten-year pact signed in Canberra on Monday by Prime Ministers Jotham Napat of Vanuatu and Anthony Albanese of Australia.

Australia undertakes to provide “enhanced mobility arrangements for Vanuatu visitors to Australia,” while Vanuatu undertakes to “develop effective mechanisms to differentiate citizenship by investment from other forms of citizenship.” A third clause obliges both governments to review the mobility arrangements annually.

The agreement does not define what “enhanced mobility” entails. It does not confer a visa waiver or designate a specific visa category; instead, it commits the parties only to annual review. Vanuatu’s Daily Post reported that the pact “did not deliver the much sought-after visa-free travel status” that Napat had sought.

Napat had raised the issue in July last year, refusing to sign unless Australia granted visa-free travel and framing the pact as one that had to serve both countries. Canberra has long resisted easing travel rules for Pacific nationals, citing concerns over overstays, and Vanuatu’s investor citizenship program has only reinforced that reluctance.

Outside the text of the agreement, Australia has assured Vanuatu that it will be restored to the 2026–27 Pacific Engagement Visa ballot with an allocation of 150 places, according to the Daily Post, after removing the country from the eligible list earlier this month. That permanent-residence ballot opens for applications on July 1.

A Distinction Vanuatu Previously Worked to Remove

For much of the past decade, Vanuatu moved in the opposite direction. In April 2019, it removed the word “honorary” from citizenship granted under its Development Support Program, a change its proponents presented as eliminating any suggestion that investor citizenship constituted a separate category vulnerable to future discrimination. A 2020 proposal to issue economic citizens a differently colored passport met with objections and went nowhere. Article 6 now commits Vanuatu to create the very distinction it once sought to erase.

The Mobility Background

In December 2024, Brussels withdrew Vanuatu’s visa-free Schengen access, the first time the bloc had removed a third country from its visa-exempt list, citing security and migration concerns linked to the investor citizenship program. The United Kingdom had imposed a visa requirement on all Vanuatu citizens in July 2023 on similar grounds.

Even so, the programs continue to generate revenue, and Vanuatu’s minimum contribution remains US$130,000 for a single applicant. All three of Vanuatu’s CBI programs process applications within weeks.

What the Text Does and Does Not Say

The treaty requires Vanuatu to be able to distinguish among its citizenship categories. It does not state how Australia will treat each category at the border, and practitioners interpret that omission differently.

Rosalind Cox, a director at Stanford Knight & Partners, bases her reading on discussions with Vanuatu officials. In her view, Article 6 is “an enhancement for every Vanuatu citizen, not the creation of different classes of citizen,” intended to make travel and visa applications easier.

Cox cautions against reading too much into the word “differentiate.” In her view, the purpose “is not about treating citizens differently at the border,” but rather about Vanuatu distinguishing, “within its own records,” between indigenous, naturalized, and investor citizens. On that basis, she describes the provision as “a record-keeping and database commitment, not an exclusion.”

She adds that differentiation enables Vanuatu to respond to security questions, observing that “Australia has an obligation to their citizens to keep their borders safe as well.” In her assessment, the result is “a clear positive” for clients, since most investor applicants “apply in good faith and good character,” and a system that allows Vanuatu to respond quickly means that “well-founded applications move through without friction.”

Manpreet Kataria, managing director of Alpha Immigration Associates, takes the opposite view, describing the arrangement as “a dangerous, regressive precedent.” In his assessment, differentiating citizens according to how they acquired status undermines “the foundational principle that citizenship must be absolute and indivisible,” and “undermines the legal integrity of Citizenship by Investment.”

He goes further, cautioning against focusing on travel access at all. “Mobility is volatile,” he said, referring to Vanuatu’s loss of both Schengen and UK access, and he advised investors to prioritize “wealth preservation, security, and a true sovereign Plan B” over visa waivers.

The agreement will not enter into force until both governments exchange notes confirming that their respective domestic procedures have been completed. Its first annual review will provide the earliest test of what “enhanced mobility” and “differentiate” mean in practice.

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