Regulated
Malta underwent a complete regulatory framework overhaul which resulted in the promulgation of a new Gaming Act 2018 which modernised the previous gaming framework promoting simplification of regulatory obligations and adopting a more risk-based approach between different gaming activities and verticals. The primary aim of the regulatory framework overhaul was precisely that of narrowing the gap between technology, gaming activities and law and thus creating future proof legislation which adapts to technological advancements. Regulations and directives set out all the standards and requirements expected by the MGA.

In terms of license coverage, the Maltese gaming regime provides for all game types and all channels of deliveries.

Market Size
The local market is rather small; however, due to the online gaming regulatory framework and licensing regime, the gaming sector is one of Malta’s major economic contributors. It contributes to around 12% of Malta’s GDP.

Competitive Landscape
There is a register for authorised B2C and B2B gaming service providers.

There is also the list of Recognition Notice Certificate holders.

There is no limit on the number of licences.

Localisation
Subject to general payment service providers requirements, licence holders in Malta do not have any obstacles to open accounts with payment methods. Importantly, even though B2C gaming service providers are required to hold player funds with EU/EEA institution, they may use other institutions as well; however, for reporting purposes the accounts with such other institutions will not be considered as safeguarded accounts.

With respect to marketing and advertising, there are certain requirements mainly outlined in the Commercial Communication Regulations, that are required to be followed when promoting gaming services in or from Malta.

Top Key Attractions and Challenges
Attractions

• Licenses are available for all kind of gaming products and the legislation is technology and distribution channel neutral
• Subject to satisfying certain criteria, reduced rates of income tax on personal income
• Exemptions on income derived from patents
• Refunds on dividends and double taxation relief
• Advantages linked to the free movement of goods and services within the EU
• Regulatory framework for the acceptance of virtual financial assets and use of innovative technology arrangements
• Persons exercising Key Function Roles are not required to be present in Malta.
• Technology can be hosted outside of Malta for as long as essential gaming data is replicated on servers in Malta in real time
• Recognition of EU/EEA gaming licenses by the MGA
• High amount of talent for employment living in the country

Challenges

• Regular audit requirements
• Stringent requirements for money-laundering reporting officers including thorough assessment of their knowledge and suitability by means of an interview
• Applicants must prove that their business is financially stable and meets all operational requirements as outlined by the MGA
• Increase in enforcement and fines by the FIAU
• High cost of living and high competition for talent
• Opening bank accounts for a start-up is very difficult unless proper substance is placed in the country
• Introduction of transfer pricing