MGA Proposes Regulatory Overhaul to Streamline Malta’s Gaming Legal Framework

MGA Proposes Regulatory Overhaul to Streamline Malta’s Gaming Legal Framework

Legal services for the gaming industry

On the 12th July 2017, the Malta Gaming Authority (MGA) published a White Paper launching a consultation process in connection with an overhaul of the current legal and regulatory framework applicable to gaming activities in Malta. The major reforms being proposed aim to repeal all existing legislation and replace it with ‘The Gaming Act’, a singular primary Act to be complemented by subsidiary legislation covering key areas of regulation and various regulatory directives and guidelines.

The current ‘multi-licence’ system will be replaced with a system comprising two different types of licences – a B2C licence and a B2B licence

The proposals are a product of the vast experience garnered by the MGA over the years and further demonstrate the Authority’s innovative, forward-looking regulatory initiative, seeking to encourage and protect the development of new potential gaming sectors whilst promoting the enhancement of consumer protection standards, responsible gaming measures and a risk-based approach towards regulation. To this end, the new regulatory framework will empower the MGA to be more agile in its decision-making by decreasing unnecessary regulatory burdens and focusing the regulator’s efforts on the areas which present a higher risk profile.

The main changes being proposed by the MGA may be summarised as follows:

  • The current ‘multi-licence’ system will be replaced with a system comprising two different types of licences – a Business-to-Consumer (B2C) licence and a Business-to-Business (B2B) licence – which will cover different types of activities across multiple distribution channels;
  • The reforms encourage an objective-based regulatory approach rather than one which is excessively prescriptive;
  • The regulatory scope is to be widened to better facilitate MGA oversight and allow for intervention where necessary and in a proportionate manner;
  • The scope of the MGA’s powers is to be broadened insofar as compliance and enforcement functions are concerned with a view to achieve the regulatory objectives, in line with concurrent AML developments;
  • B2B licensees will effectively be exempted from gaming tax, thereby increasing Malta’s competitiveness as a key jurisdiction for such operators

    The role of the Key Official will be segmented into various key functions within a licensed activity;

  • Player protection will be bolstered by formalising the mediatory role of the MGA’s Player Support Unit, enshrining segregation of player funds at law and moving towards a unified self-exclusion database across both remote and land-based delivery channels;
  • The new legal framework will introduce the concept of administration to protect distressed licensees and, if necessary, to assist in the winding down process, ensuring protection of jobs and player funds;
  • Automated reporting will be encouraged with a view to facilitating adherence to regulatory obligations and strengthening the Authority’s oversight;
  • New obligations requiring operators to monitor sports betting and report suspicious bets will be introduced, strengthening the MGA’s role in combatting manipulation of sports competitions;
  • The period of validity of licences granted by the MGA will be extended from 5 to 10 years;
  • Taxation will be streamlined into one flow with two main layers; and
  • B2B licensees will effectively be exempted from gaming tax, thereby increasing Malta’s competitiveness as a key jurisdiction for such operators.

The consultation period in respect of the proposed new legal framework for Gaming in Malta will close on the 23rd August 2017.

Contact Be. Legal Advocates to find out how the proposed legal and regulatory overhaul of Malta’s gaming sector could affect you and your gaming operation

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