This has nothing to do with permanent residency permits
Once a non-Maltese EU citizen has been living in Malta for 5 years, they can apply for a long term residency permit. If successful, they then don't need to apply for a residency permit every few years, normally five. Given residency permits only came into being in their current form when Malta joined the EU, I don't think this has been tested yet - I was part of the first batch of people to apply for a residency permit, and mine expires in Feb 2011. There are conditions - the following paragraph is taken from the following thread
An EU citizens legal rights - residency, working, students
http://www.britishexpat.com/expatforum/ ... hp?t=21120
Permanent Residence
Once the EU national (and his/her family members) has lived in Malta for a continuous period of five years or else as provided for in Regulation 6 of the abovementioned Order, s/he is entitled to apply for confirmation of permanent residence. S/he will have to be living in Malta and be in employment, or self-employment, or as a student or as an economically self-sufficient person throughout the five year period. For residence in Malta to be considered continuous one must not have been absent from Malta for more than six months each year. Longer absences for compulsory military service will not affect such residence. Additionally, a single absence of a maximum of 12 months for important reasons such as pregnancy, child birth, serious illness, study, vocational training or posting overseas, will also not affect the required continuous residence.
Non-EU citizens (3rd country national) can also apply for this, but they have to pass a course on the social, economic, cultural and democratic history and environment of Malta in order to help them integrate in Maltese society. The course must be of at least 100 hours and must be provided by an agency recognised by the government. The applicant must attain a pass mark of at least 75%.
3rd country nationals also have to prove that they and their families have stable and regular resources to maintain themselves without recourse to social assistance and that they have appropriate accommodation.
The regulations also provide that the family members of a person granted long term residence status shall be allowed to accompany the third country national in Malta.