Malta Online Gambling Legislation

Malta was the first EU member state to introduce Remote Gambling regulations.

The single legislative body managing all gambling activities in Malta is the Lotteries and Gaming Authority (LGA). It is responsible for regulating casino gaming, commercial bingo and communication games, remote gaming, sports betting, the National and other lotteries, non-profit games.

The authority aims at being neutral in terms of technology and game of any type of gambling by means of distant communication providing decent Online Gambling Jurisdiction in Malta. It means that any remote game which can be completely monitored under Malta LGA is considered for licensing. The most dynamic Internet gambling sector in Malta is regulated by the Remote Gaming Regulations 2004.

To provide Internet betting/gaming services in Malta one should apply for a license of the relevant class :

• Class 1 covers casino-type games, skill games and online lotteries and is for operators responsible for the risk on repetitive games;
• Class 2 comprises fixed odds betting, pool betting and spread betting and is for operators responsible for the risk on events based on a matchbook;
• Class 3 includes P2P, poker network, betting exchange and game portals and is for operators taking a commission from promoting and/or betting games;
• Class 4 permits to host and manage remote gaming operators excluding the licensee himself and is for software vendors.

According to Malta Internet Gambling laws, license of any class is issued for five years and could be renewed thereafter for the same periods. The obligatory requirements in Malta Online Gambling Regulation is to locate physically in the country the significant part of the online betting or gaming operations.

Maintenance of the License

In granting a license the Authority may subject it to such conditions as it may deem appropriate, and after the grant of such licence the Authority may from time to time vary or revoke any condition so imposed, or impose new conditions.

A license granted by the Authority may impose conditions relating to, inter alia:
(a) the proper operation of interactive games
(b) the protection of players
(c) the prevention of money laundering
(d) exigencies of public interest.

The granting of a license is a revocable privilege, and no holder thereof shall be deemed to have acquired any vested rights therein or hereunder. The burden of proving the licensee's qualifications to hold a license shall rest at all times on the licensee.

As a further guide to interpretation LGA specifies a number of services that are deemed (or not deemed) as strictly required, related or essential for a licensee to provide to meet the requirements of acquiring a licence in Malta.

The list of strictly required services covers the issues related to:

• fraud prevention,
• game functionality,
• risk management,
• player support,
• intermediaries commission,
• payments solutions.

At the same time the following services are not considered to be strictly required:

• marketing,
• technical and hardware supply services,
• telecommunications,
• professional fees,
• staff costs,
• administration and other costs.

It shall also be the duty of the licensee to obtain the prior approval in writing of the Authority before taking any of the following actions:

• assignment or transfer of a license,
• changes in the Board of Directors,
• resolution or application to the Court for dissolution,
• transfer a qualifying shareholding in the licensee,
• increase an existing holding,
• reduce an existing qualifying shareholding,
• the sale or other disposition by the licensee of its business,
• the merger of the licensee with another company,
• the reconstruction, division of a company,
• the reduction of the nominal or issued share capital of the licensee or the increase or reduction of its voting share capital or any material change in voting rights in such licensee,
• entering into any contractual arrangements with any supplier or entity providing services, if such supplier or entity will receive a percentage of the profits of the remote gaming operation, pursuant to such an agreement,
• the surrender of the licence by the licensee during the licence term.

In all its actions, Licensee is also bound to maintain financial records, an updated control and gaming system, serious anti-money laundering (AML) policies & procedures, data protection procedures, responsible gaming and advertising policies. All this needs to be maintained in order to ensure the financial and personal protection of the player.

Trusts

Although Malta is essentially a civil law jurisdiction, the legislature has introduced the concept of Trusts over time. Trusts were originally only available to non residents with very advantageous benefits and it is only since 2004 that the setting up of trusts in Malta has been made available to both residents and non-residents. Today the Trusts are regulated by the Trusts and Trustees Act.

A trust is an obligation which binds a person or persons (called the trustee) to deal with property of which the trustee is deemed to be the legal owner (called the trust property) for the benefit of persons (called the beneficiaries) or for a charitable purpose in accordance with the terms of the trust.

In terms of Maltese law, a trust is an example of a fiduciary relationship between the Settler and the Trustee whereby the settler transfers his property to the trustee who shall act in terms of the trust deed. Due to this fiduciary nature of trusts, a trustee must be licensed to act as such in terms of the Trusts and Trustees Act except in certain limited cases provided by law.

For more information and the documents samples to be submitted, refer to LGA or consult the following:

1. Chetcuti Cauchi Advocates

Britannia House
Melita Street
Valletta VLT 1122
Malta

Phone: +356 22056200
Fax: +356 22056201
Website: www.cc-advocates.com
Main Contact: Dr Jean-Philippe Chetcuti

2. Zammit & Associates - Malta Advocates

The Penthouse, Tower Business Centre
Tower Street
Swatar BKR 3013
Malta

Phone: +356 2557 2300
Fax: +356 2557 2310
Website: www.zammit-law.com
Main Contact: Dr Andrew J. Zammit

3. Mifsud & Mifsud Advocates

123 Melita Street
Valletta VLT 1123
Malta

Phone: +356 27237172
Fax: +356 27237314
Email: info@mifsudadvocates.com.mt
Website: www.mifsudadvocates.com.mt

4. EMD Advocates

Vaults 13 - 15
Valletta Waterfront
Valletta FRN 1913
Malta

Phone: +356 21 233005
Fax: +356 21 237277

Website: www.emd.com.mt
Main Contact: tellul@emd.com.mt

5. CSB Group

The Penthouse,
Tower Business Centre
Tower Street
Swatar BKR 3013
Malta

Phone: +356 2557 2557
Fax: +356 2557 2558
Website: www.csbgroup.com
Main Contact: Mr. Michael Zammit (iGaming@csbgroup.com)

5.1

Merchant Street,
Valletta, VLT 1171
MALTA

Tel: +356 2010 7755
+356 2010 7766
Fax: +356 2124 9950
Email: info@fidesmalta.com
Web: www.fidesmalta.com