1. Serious Regulations, Serious Jurisdictions

Malta was the first EU Members States, in April 2004, to establish a liberalised and technology neutral regulatory framework for iGaming.

The regulations championed a strict approach to licensening and monitoring of gaming operations. This was somewhat atypical at the time. Heavy handed regulations was generally considered to be a disincentive to operators seeking an easy set-up subject to minimal or no regulation. Adversely, the Maltese regime pivoted on the principle that strong regulation need not necessarily be a burden.

Over the years, Malta has become increasingly attractive to operators who require a legitimate regulatory platform in an increasingly hostile legal environment. The regulations go to lengths to ensure that operators are serious and that, ultimately, players are protected. The licensing process is rigorous and control systems have to be audited for compliance. Furthermore, the applicant, managers and beneficiaries have to satisfy ‘fit and proper’ criteria and have to demonstrate that they have the necessary business and technical abilities. In turn, the Authority carries out ongoing monitoring to ensure operations are in line with the law and licence conditions.

Malta therefore avoided the mistake made by other jurisdictions that have suffered from mediocre operations plagued with a high concentration of illegitimate activities due to lack of regulations. Equitable regulation benefits the industry because it ensures compliance with international obligations such as anti-money laundering legislation. More specifically, good regulation guarantees enhanced user confidence in the undertakings’s operations and the Authority’s seal of approval to be displayed on licensees’ website, has become a point of reference for players around the world.

2. Status of Onshore Financial centre

Malta currently operates a full imputation system of taxation, whereby tax charged to the company is imputed to the shareholder in the the event  of a dividend distribution. This means that a shareholder will not be charged tax twice on dividends. Post January 2007, shareholders are entitled to claim refunds of up to six sevenths of tax charged to the company. The result of such refunds is that the effective total tax paid is of 5%. This regime is fully complaint with international tax standards and with EU legislation.

Couple with the above, the considerations that Malta enjoys a sovereign credit ‘A’ rating, an excellent economic track record, political stability and has become part of the eurozone, confirm Malta’s attractiveness as an onshore financial centre.

3. EU Membership

As an EU Member state, Malta benefits from the application of the internal market principles relating to the freedom to provide cross-border services within the EU.

Recent case law – principally the Placanica decision and previous ECJ rulings in Schindler, Laara, Zenatti and Gambelli – have confirmed that blanket national concession regimes based on traditional monopolies are unlawful unless such restrictions are justified on the basis of a genuine reduction of gaming opportunities and are applied consistently.

In effect, this implies that online services provided from Malta may not be prohibited in other member States such restrictions are justifiable. The EU is taking a restrictive stance with respect to limitations to the freedom to provide services.

4. Professional and Efficient Regulator

Having recently increased its human resources, the Authority is fully equipped to deal efficiently with licensing applications and with ongoing monitoring. However, it does not limit its role to policing activities. The Authority acts as a mediator in cases of differences between players and operators. Furthermore, the Authority operates an ‘open door’ policy whereby prospective or licensed operators may discuss an issue upfront with the responsible officials.

5. Low Fees and Gaming Taxes

As confirmed by a recent official study, on gambling services in the internal market the fees and gaming taxes levied are amongst the lowest in Europe. Gaming taxes depend on the class licence and are capped at a maximum of € 466,000, per annum. Click here for more information.

6. Availability of Human Resources

Malta boasts a flexible, reliable and highly productive multilingual workforce. The number of university students graduates has more than tripled in the last decade with close to 3,000 students graduating each year. Furthermore, the Authority has recently started providing sessions aimed at training more people in compliance, management and day-to-day running of gaming operations.

7. Advanced Technical Infrastructure

Malta has an established state-of-the-art telecommunications infrastructure capable of hosting and delivery round the clock connectivity. Ancillary services such as online payment processors are also available. The World Economic Forum has recently ranked the Maltese Government as the second  most successful government in promoting the use of ICT.

In November 2009, Malta ranked first amongst EU member state when it comes to IT and e-government. The 2009 EU e-Government Benchmarking has shown Malta making an outstanding leap in the delivery of e-Government services. In fact Malta has topped the country ranking in both Online Sophistication and Fully Online Availability by achieving the maximum possible score (100%), making it the best performing country in the EU.

Malta has reached maximum possible score (100%) in the ‘One stop Shop’ and ‘User focused portal design’, whilst attaining second and third place respectively in ‘User Satisfaction Monitoring’ and ‘Usability’.

8. Active Remote Gaming Industry

The Malta Remote Gaming Council was set up with the aim of creating a common platform from which operators may address several issues with the benefit of collective experience. The end result is that today industry players can voice their concerns and make proposals via this Council to the relevant authorities.

9. High Standard of Living

Not only is Malta in the ideal position in the Mediterranean in its proximity to mainland Europe and North Africa, it offers a very good quality of life, low criminal rates, excellent health services and diverse entertainment and sport facilities.

10. A Tried and Tested Jurisdiction

During the past three years, Malta has attracted over 160 remote gaming operators. This statistic is significant not only in respect of the quantum of operators but, particularly, in the rate of growth – every year the number of operators doubles – and in the high profile of operators are selecting Malta as their iGaming jurisdiction.

This growth manifests that the regulatory framework, despite its rigorous nature, has been well received by the industry. This consideration coupled with the tax planning advantages and the other benefits highlighted above, promise to consolidate Malta’s position as the preferred iGaming jurisdiction.