How strong is Malta’s iGaming license today?

How strong is Malta’s iGaming license today?

29 November 2022

The Remote Gaming Regulations enacted in 2004, positioned Malta as the first European Member State to regulate the online gaming sector. Over the years, Malta has successfully established itself as a prominent iGaming hub, with an astounding 10% of the world’s gaming companies being registered in Malta. Many factors make Malta a desirable place for iGaming companies to invest in – perhaps, being renowned as the gold standard of iGaming licensing tops the list.

But what makes Malta’s iGaming license such a strong contender, and is this still relevant today? Read on to find out.

The Malta Gaming Authority License

Obtaining a gaming license in Malta is a rigorous, costly, but rewarding process. Due to the stringent rules and control mechanisms applied by the regulating authority, having successfully obtained a Malta Gaming Authority (“MGA”) license means that licensees have satisfied several demanding and comprehensive checks – not to mention the ongoing intensive monitoring carried out by the MGA even after the license is obtained. For this reason, operators with a MGA license are highly respected and viewed as being transparent, fair, honest, and operating within EU rules. This gives payment service providers and players alike the confidence and security they yearn for when affiliating with an iGaming company.

Developments in European countries

For over 16 years, the MGA license was one of the few iGaming licenses available in Europe, however, in recent years, several European countries have followed Malta’s lead and are attempting to deconstruct existing local gaming monopolies by legalising iGaming in their jurisdiction. This raises concerns about the future of the MGA as an international iGaming hub.

In 2021, France’s gaming regulator, L’Autorité Nationale des Jeux (“ANJ”) introduced new iGaming laws voicing serious concerns about the marketing strategies employed by local gambling monopolies La Française des Jeux (“FDJ”) and racing monopoly, Pari-Mutuel Urbain (“PMU”) and announced its plans to place significant emphasis on consumer protection. Similarly, after gaming operators had been operating unrestricted in Germany for many years, in 2021 Germany set up an iGaming regulating body – the Gemeinsamen Glücksspielbehörde der Länder– putting local iGaming practices under the microscope. The Netherlands is an example of another European country that has chosen to regulate local iGaming practices, whereby its regulating authority – the Kansspelautoriteit (“KSA”) – started granting iGaming licenses in April 2022.

For Malta, these developments meant that the MGA license is no longer the instrument of choice for iGaming companies that want to offer services to punters based in countries with an online gaming regime. In fact, the MGA reported that since the setup of the KSA in the Netherlands, the number of Dutch operators applying for an MGA license was comparatively low.

The future of the MGA license

As the trend of legalising iGaming continues to pick up across Europe, the MGA will need to carefully reconsider its regime in order to remain an attractive solution in the international iGaming market. The MGA is known for having quite a rigorous application process, and therefore working on moving towards a more straightforward and more efficient process could help Malta keep on top of the rising competition.

Having said that and despite seeing a rise in countries adopting their own iGaming regime, the fact remains that a substantial part of the world is still an unregulated territory when it comes to offering iGaming services. Indeed, the MGA continues to issue scores of new licenses every year, recording a total of 351 issued iGaming licenses in 2021.

Change comes fast, especially in an ever-evolving sector such as iGaming. As the number of countries that choose to regulate iGaming continues to increase, so will the number of operators that opt to operate solely under licenses granted by their own jurisdiction. This means that the MGA will inevitably witness a drop in the number of issued iGaming licenses. However, with the knowledge and experience that Malta gained as a frontrunner in the iGaming sector for so many years, it’s safe to say that Malta – unlike no other – understands iGaming. This, together with Malta’s stable history in financial, banking and commercial services, and favourable gaming taxes, will continue to make the MGA license a strong solution among serious operators seeking to render iGaming services in Europe.

At AE, our efforts are directed at providing complete corporate and professional solutions to iGaming companies. We will help you set up your company and support you throughout your business journey, ensuring all local compliance and legal regulations are adhered to consistently.