Malta gambling license

MALTA - The most accessible European jurisdiction for gaming business. Malta was the first EU country to regulate remote gaming. The main document regulating this area is the Remote Gaming Regulations S.L. 438.04, the regulatory body is the Malta Gaming Authority (MGA).

Maltese licenses are divided into four classes depending on what type of operating company falls under and include both licenses for B2C operators (business to consumers) and B2B operators (business to business).

Class 1.

Remote gambling license. Games such as casinos and online lotteries. Games based on repeatable events where the operator manages the gambling risk.

Class 2.

Remote betting license. Issued to operators of various online bets (for example, sports betting).

Class 3.

License to promote and/or facilitate remote gambling in or from Malta. (For example, a poker room, promotional activities).

Class 4.

A license for hosting and managing remote gaming operators, while the license holder is not a gambling operator himself. It is essentially a B2B gaming license.

Class 1 based on a Class 4 License. This (sub)license is issued for the organization of remote games “for luck” or “for experience”. Available for Class 1 license operators who operate their games on software and through hardware under a Class 4 license. However, a Class 4 operator may be a company owned by a Class 1 operator or an independent company.

Conditions to be met by the applicant company:

• registration in Malta in the form of LLC (similar to LLC);
• the required amount of paid-in authorized capital (its amount for obtaining a class 1 and class 2 license must be at least € 100,000, for class 3 and class 4 - at least € 40,000);
• availability of technical and organizational means for carrying out operations related to online gaming;
• availability of financial and other economic resources or security;
• give guarantees for the payment of winnings and the return of deposits.

Licensing of remote gambling business in Malta has the following stages:

1. Submission to the MGA of an application for a license, as well as a business plan and other necessary documents.

   At this stage, the financial solvency of the beneficiaries and directors of the company is checked, as well as an in-depth financial analysis of the business plan (at the same time, the MGA checks in detail the company’s development strategies, HR plan, growth indicators, etc.). In addition, the MGA may request documents that confirm the financial stability of members and directors. It takes 2-3 weeks from the moment of providing all the necessary documentation.

2. Registration of a local company and opening bank accounts.

   Submission of constituent documents, as well as all technical documentation for the project, which contains detailed data on the structure of the system and applications, description of software, management procedures, security, data backup, data recovery in emergency situations, etc.

   The second stage takes 12-16 weeks. After successful completion of the second stage, a temporary license is issued for six months with the possibility of its extension for another three months. During this period, the licensee must begin its activities and pass an audit.

3. An audit carried out by an auditor appointed by the MGA.

   Duration: 6 months, same as the duration of the "temporary license". If the audit is successful, the licensee is issued a full license for a period of 5 years, containing conditions that the MGA deems necessary to put forward.

Benefits of obtaining a gaming license in Malta:

• Malta's belonging to the European Union, which is a guarantee of prestige and trust on the part of potential players;
• the procedure for obtaining a license and running a gambling business is qualitatively worked out in the legislation and worked out in practice;
• there are many IT companies in Malta that specialize in this market segment and provide comprehensive accommodation services;
• relatively low royalty fee: €8,500 annually + €4,830 one-time fee (€2,330 application fee + €2,500 audit fee);
• the possibility of obtaining a temporary license until the main one is issued.

Disadvantages of obtaining a gaming license in Malta:

• Online casino activities are subject to direct taxation under two items: corporate income tax (5%) and gambling tax (Gaming/Betting Tax), the amount of which depends on the license class:
• 1st class – €4,660 per month from months 1 to 6, €7,000 per month from month 7
• 2 class - 0.5% of the amount of accepted bets
• Grade 3 - 5% of actual income
• 4th class: from 1 to 6 months tax-free, from 6 to 12 months - €2,330 monthly, from the 13th month - €4,660 monthly + €1,165 per month for each operator for which this person does not have a class 1 license, 2 or 3

1st class based on 4th class license – €1,200 per month;

At the same time, the total amount of taxes cannot exceed €466,000 per year. If you do decide to obtain a license in Malta, please note that:

• the licensing process in Malta is quite complex and lengthy;;
• companies are required to file a large number of reports:
• annual financial statements certified by an auditor must be prepared
• the company must submit monthly reports:
  1. gambling business tax;
  2. by gaming magazines;
  3. according to players
  4. player bank statements;
  5. in case of changes to the approved infrastructure, upgrades and maintenance of gaming equipment - reporting on incidents;
  6. in the event of removal or relocation of play equipment, a decommissioning report.

Malta Corporate Law