The Parliament of Malta passed in its third reading an update to its decades-old Gaming Act, which provides new rules and regulations for companies seeking licenses for online and land-based gaming operations.
The new gaming bill was introduced for first reading by the Parliament by Hon. Silvio Schembri, Secretary for Financial Services, Digital Economy & Innovation in March. Schembri introduced the bill with the purpose of repealing all existing gaming regulations and replace it with a single Act of Parliament to encompass all governance and regulation related to gaming.
Essentially, it’s a cleanup of all the gaming licensing processes that exist in Malta, and an effort to give the Malta Gaming Authority (MGA) the sole power to effectively regulate the industry and protect the consumers.
Malta: A Licensing Haven
When online casinos started to become popular, Malta was one of the very first countries to open its arms to companies seeking gaming licenses. In fact, so many gaming companies have sought refuge in Malta that 50 percent of the country’s international bandwidth is being used by the remote gaming industry. As of now, despite the small size of the archipelago, Malta hosts 10 percent of the world’s online gaming operations. It is also home to one of the most prestigious gaming summits in the world such as the Summit of iGaming, Malta (SiGMA).
Hundreds of gaming companies including Betfair, Bet-at-home, Intercasino, and PokerStars, chose Malta for two main purposes: the ease of gaining a license and the low tax rates. Technically, tax rate is flat at 35 percent, but shareholders can claim 85 percent of the tax back. This means that essentially, only 5 percent is being paid as tax to Malta.
The last time Malta refreshed its gaming laws was back in 2004 and they were in need of a makeover.
Highlights Of The New Gaming Act
One of the highlights of the new Gaming Act includes the appointing of “Key Officials,” where all operators are required to name key officials for corporate roles, and these officials will be directly scrutinized and thoroughly checked by the MGA. MGA will investigate all key officials, whether they are suitable for the role, and if they are in possession of certifications or relevant experiences that match their roles.
In a statement, Heathcliff Farrugia, Chief Executive Officer of the MGA, said “This is a very important milestone for the Malta Gaming Authority. The new law establishes very robust compliance and enforcement powers and structures and lays the necessary foundation to continue to strengthen player protection.”
MGA’s Player Support Unit will also be formalized as the mediator between operators and aggravated players who wish to seek justice and legal counsel for anything criminal and administrative related to the operators.
Different Gaming Licenses
The current licensing system under the MGA offers four types of licenses: a remote gaming license for casino-type games and online lotteries, a remote gaming license for sports-betting, a license for advertising gaming, and a B2B gaming license. Under the new Gaming Act, the licenses will be consolidated into two main licenses: a business-to consumer (B2C) license and a business-to-business license (B2B). The validity of the licenses will also be extended from the current 5 years to 10 years.
A new taxation model will also be enforced to clarify the older tax rates that cause confusion because of the fixed rate and tax back. The new model proposes a fixed tax rate that amounts to 5 percent of the operator’s Gross Gaming Revenue (GGR), and is only applicable to revenue from Maltese customers. B2B operators are exempted from the taxation and will only be paying the annual license fee.
The new annual license fee will be fixed at €25,000, with a variable compliance contribution fee that is payable monthly. The compliance contribution fee varies depending on the games offered, and is capped at a minimum of €15,000 or €25,000, and a maximum of €375,000, €500,000, or €600,000. All operators are required to start paying the new license fees by July 1 this year.
More Protection For Players
The new Gaming Act also covers an increased level of protection for customers. The MGA will roll out a list of non-compliant operators so players can check whether they’re playing on a site managed by an operator who complies with all the rules and regulations set by the MGA. The MGA will be tasked to strengthen its role in promoting responsible gaming and protecting minors or vulnerable people by incorporating the functions of the Responsible Gaming Foundation under the MGA.
Misleading advertising, bonuses, promotions, and all kinds of commercial communications will also be put under a new set of standards that will be developed by the MGA to protect customers.
The new Gaming Act is expected to roll out for compliance by July 1, 2018 for remote gaming operators, and January 1, 2019 for land-based operators.

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