The Maltese government established the Remote Gaming Regulations (S.L. 438.04) in 2004 to oversee the iGaming sector much earlier than other governments. Most European Union members still do not have their own national rules. Beyond the E.U., most governments either have no rules or, at best, unclear rules.
By holding an international license and being an E.U. member state, Malta filled that gap and continues to do so.
Gaming companies do a great deal to protect players where gambling may become an issue. Moreover, the Gaming Player Protection Regulations of 2018 includes Protection of Player Funds. An authorised person shall hold such player’s funds on behalf of and in the player’s interest. They also retain responsibility when outsourcing and may issue binding instruments.
Player funds are also kept segregated. The player retains ownership of player funds and is protected from the operator’s creditors.
Malta has built a reputation as an international hub for iGaming. Most of the biggest iGaming businesses are now Malta-based, so it is no surprise that the workforce comprises many foreign nationals. The industry continues to grow, and the government is keen to attract more Maltese citizens.
The Malta Gaming Authority (MGA) governs all gaming activities in Malta. The Regulations are divided into four classes, depending on which type of operation companies fall under. It includes licenses for Business to Consumers (B2C) and Business to Business (B2B) operators.
The MGA regulatory regime aims to be both technology and game-neutral. It encompasses any gaming using a means of distance communication (including internet, digital T.V., mobile phone technology, telephone and fax). Any remote game that can be securely managed under MGA regulations is considered for licensing.
The class of license depends on the nature of the operator’s proposed activities. The Remote Gaming Regulations provide four (4) classes under which an operator may be licensed.
Class 1 License - Generally required for operators managing their own risk on repetitive games, such as casino-type games.
Class 2 License - Required for operators managing their own risk on events based on a matchbook, including fixed odds betting.
Class 3 License - Generally required where players on the network play against each other and the operator takes a rake percentage for organising and promoting the game.
Class 4 License - Required to host and manage remote gaming operators, excluding the licensee himself. Gaming software and platform providers usually fall within this class.
Licenses are granted for a period of five (5) years and may be renewed for further five (5) years each.
The core part of the iGaming operation must be located in Malta. Malta gaming companies must have a Key Official, who must also be a director of the licensed company and be a resident of Malta. Their role is to supervise the daily operations of the Malta gaming company and ensure that the operator is compliant with Maltese law and regulations.
Class 1 and Class 2 license holders must retain a minimum share capital of €100,000. Class 3 and Class 4 licensees must maintain a minimum share capital of €40,000.
Companies with multiple licenses must meet the above share capital requirements cumulatively up to a minimum capping of €240,000.
The licensing process includes a critical assessment by the MGA to assess whether the applicant is:
1) Fit and proper to conduct gaming business
2) Correctly prepared for a business strategy perspective
Applicants must have the operational and statutory requirements to meet the legal obligations expected by Maltese Law. They should have correctly implemented what has been applied in a technical environment before going live.
If the MGA’s evaluation is completed successfully, the applicant must execute the documented system onto a closed system. An independent third party contracted by the MGA may perform an external systems audit.
Upon completing the certification process, the MGA will issue a five (5) year license for the applicant.
The MGA usually determines an application for an iGaming license within 4 to 6 months of submitting a complete application. The timeframe depends on the quality of the information provided and the timeliness of the applicant’s response to queries for further details from the MGA.