Malta is quite the hub for gaming activity; however, such activity is very diligently regulated and controlled in terms of protection of players and persons who may be given access to the operation of any type of gaming licence. The regulation of land-based gaming in Malta has developed over hundreds of years, thus sophisticated and detailed rules control casinos, gaming devices, lotteries, tombola, betting and similar games.
Lotto games are likely to have been operated in Malta since the end of the 17th and 18th Century; however, it was only in 1922 that the Public Lotto Ordinance was enacted to establish the government monopoly for the organisation of lotto activities. The Racecourse Betting Ordinance was subsequently enacted in 1934 to regulate horse and dog racing licences. The next major milestone in the development of Maltese gambling history was in 1958 with the promulgation of the Kursaal Ordinance, which regulated casino activity. This statutory instrument was subsequently superseded by the Gaming Act 1998 which provided further controls and reinforcement of the regulatory framework for casinos. In 2001 the Lotteries and Other Games Act (LOGA) was enacted by the Maltese legislator to establish the Lotteries and Gaming Authority (now the Malta Gaming Authority or MGA) which replaced the Director of Public Lotto. The same law incorporated all gaming legislation into a single legislative instrument, with the exception of casinos which continue to be regulated by the Gaming Act (Cap. 400 of the Laws of Malta).
The LOGA makes it clear that ‘gaming’ under Maltese law refers to a game of chance for a prize. As a general rule, under Maltese Law, provision of gaming in or from Malta will require a licence from the MGA. Licensing procedures for all types of land-based gaming in Malta are relatively similar in that they generally entail:
- The completion of specific MGA forms;
- Applicant due diligence measures (ADD Measures) to be carried out at application stage for the identification, verification and investigation of all natural and legal persons involved with the prospective licensee (the Applicant), together with submission of a business plan where applicable, to ensure that such persons are:
- ‘fit and proper’ persons of good standing having the expertise to carry out their proposed operations as required under Maltese law; and
- that they have the financial resources and expertise to carry out their proposed operations as required under Maltese law.
- Reviews of the Applicant’s proposed set-up, software, premises, rules, regulations and procedures.
Despite the similarities in all of the application procedures, some matters of the licensing procedures are particular to the game or sector in question; for this reason, very brief outlines of the various licensing procedures can be found below. It should be also noted that employees and certain suppliers in the land-based industry are often in a position to abuse of their role, and thus such employees and suppliers must also be vetted by MGA. A quick reference to the licensing of employees / suppliers is also included in the relevant paragraphs below.
Casinos in Malta are primarily regulated under the Gaming Act (Chapter 400 of the Laws of Malta) (the GA) and supplemented by the Gaming Act Regulations, Act (Chapter 400.01 of the Laws of Malta) (the GAR). In order to operate a Casino, a concession must be obtained by the Applicant from the Minister of Finance. However, this is in addition to a licence issued by the MGA and therefore, the ADD Measures must still be carried out by the MGA at application stage. Land-based poker games are not regulated per se and are therefore included in the general land-based Casino license. The GA and GARs also regulate the setting up of rooms dedicated to card games. Such rooms must be approved specifically within the Casino licence or at a later stage if they are set up after the original licence has been issued.
In addition to the abovementioned approval, a licence must also be issued with respect to any person who intends to work as a Casino employee or Manager. The MGA’s Casino Employee Application Form states that a “casino employee” is a “receptionist, dealer, chef de table, cashier, supervisor, watcher, machine engineer, manager, or any other person who, in the view of the MGA, is involved in the gaming operations of a casino”. The GA states that both the casino operator and the employee will be guilty of an offence if a role is carried out within the casino without the proper authorisation. The GA also sets out the procedure and conditions of eligibility for the Casino employee’s license as well as the situations in which an employee licence may be cancelled.
Junket leaders must also complete the necessary form and request to be licensed in accordance with the GA and GAR as they involve the cross border movement of people and funds and often target high net-worth / VIP clients.
In Malta Gaming Devices are regulated under the Gaming Devices Regulations (Chapter 438.07 of the Laws of Malta) (the GDR). One should note the distinction between a gaming device (which offers the possibility of winning a prize) and an amusement machine (which is for entertainment purposes only, without offering the possibility of winning a prize). In relation to gaming devices, the relevant licence is required in order to manufacture, assemble, service, supply, use, hosting or operation of such device. The following classes of licences are available:
- Class 1 licence for the purposes of manufacture, assembly and repair of gaming devices;
- Class 2 licence for the purposes of supply, lease, sale or transfer of gaming devices;
- Class 3 licence for a person to make available for use, or for the host or operation of gaming devices; and
- Class 4 Licence for a person to administer a central system for gaming devices. The Central System is an electronic system or a computer system to which Gaming Devices may be connected directly or indirectly register all or part of the gaming taking place through such relevant Gaming Device, to supervise all or part of the operations carried out in or through such Gaming Device and/or to store and provide reports and information on the aforesaid matters.
Employees employed or permitted to work in relation to the operation of gaming devices, as well as the Key Official of entities in possession of a licence relating to gaming devices, must also be submitted to limited ADD Measures. A summary of the required ADD Measures may be found in Table 1.
The Malta National Lottery is the main lottery in Malta, and the games which form part of the National Lottery are Super 5, Lotto, Scratchers Instant Tickets, U*Bet, Quick Keno and Bingo. The license and set-up of the National Lottery is regulated by the LOGA, which provides that the National Lottery may be conducted under Ministerial authority or by any other person in whose favour a concession is granted for this purpose. LOGA provides that only one person (or company) in possession of a valid licence may operate the National Lottery at any given time, and the licence is generally granted through a competitive tendering process. A significant amount of scrutiny is thus automatically entailed in the licensing process and will mainly be dictated within the tender document.
The resellers of the games which form part of the National Lottery must be in possession of a permit issued by the MGA, issued after completion of the relevant ADD Measures. Employees of the National Lottery, the Key Official and the Money Laundering Reporting Officer must also complete the relevant forms and undergo ADD Measures.
If any person intends to organise a lottery other than the National Lottery in Malta, a request for a permit must also be made. Such request must again be made by the completion of the relevant MGA forms (one for Advertising Lotteries and one for Not for Profit Lotteries organised by Non-Profit Organisations), together with the relevant ADD Measures.
Bingo games are regulated under the Commercial Tombola (Bingo) Regulations, Subsidiary Legislation 438.05 (the CTR) which provides that no person shall operate commercial tombola games in a tombola hall unless such person is in possession of a valid licence of the relevant class. The CTR provides for two types of tombola licences:
- Class 1 Tombola Hall Licence is a licence for a tombola hall with a seating capacity of not less than one hundred and fifty persons, for a period of one year;
- Class 2 Tombola Hall Licence is a seasonal licence for a tombola hall with a seating capacity of not less than one hundred and fifty persons, for a period of six months.
As with the other types of games, an application for a licence to operate a tombola hall calls for completion of the relevant MGA form, accompanied by the relevant ADD Measures as detailed in Table 1. Certain employees, namely the Key Official, Caller, Chief Cashier, Chief of Table, Seller and Tombola Head Supervisor must also be vetted by the MGA.
Regulation of betting under the laws of Malta deals with:
- Racecourse betting (a bet on a horse race or races or on a dog race or races conducted on a racecourse); or
- Sports betting (a bet on a sport event or a set of sport events, including a racecourse bet).
The principal legislative instruments regulating land based Betting in Malta include:
- The Lotteries and Other Games Act (“LOGA”) – is the parent act, regulating all forms of gaming in Malta and establishing the general principles of gaming.
- Racecourse Betting Ordinance (“RBO”) – this Ordinance regulates the horse and greyhound racing betting licenses.
- Racecourse Betting (Use of Totalisator) Rules (“RBTR”) – provide for guidelines with respect to the operation of the Totaliser.
- Betting on Result of Football Matches Order (“BFMO”) – provides amongst others a list of places within the Maltese Islands where betting on football matches is prohibited.
- Betting at Malta Racing Club Order (“BMRCO”) – The BMRCO provides that race course betting, unless provided for under the RBO is prohibited.
Equinox provides a ‘one stop shop’ to assist a prospective gaming applicant through any of its requirements in the gaming application process. Equinox can also assist a licensee, after the application process, in the day to day running of the online gaming operation.
Equinox offers the following services:
- Advising the prospective applicant in relation to the class of licence required;
- Liaising with the MGA and other third parties on the client’s behalf;
- ‘Hand holding’ through the process of collection of the KYC Documentation and the completion of the application forms;
- Assistance in preparation of the business blan;
- Assistance in preparation of the systems documentation;
- Drafting of terms and conditions for the applicant’s games,
- Drafting any required agreements;
- Provision of general legal and regulatory advice in relation to the operation of the gaming business in Malta;
- Provision of tax advice as necessary;
- Assistance in the event of a merger/acquisition.
For further information on online gaming matters, please contact us on firstname.lastname@example.org