Land-based gambling

Types

What types of land-based gambling are permitted in your jurisdiction, and is gambling regulated at a national or subnational level?

Gaming is regulated at a national level. The new legal framework is no longer sector-based (land-based gaming, remote gaming etc) as was previously the case but rather is principle-based. The simplified two-tier system comprises a business to consumer (B2C) licence and a business-to-business (B2B) licence. The two latter licence categories cover different types of gaming activities:

  • Type 1 - games of chance played against the house, the outcome of which is determined by a random generator;
  • Type 2 - games of chance played against the house, the outcome of which is not generated randomly, but is determined by the result of an event or competition extraneous to a game of chance, and whereby the operator manages his or her own risk by managing the odds offered to the player;
  • Type 3 - games of chance not played against the house and wherein the operator is not exposed to gaming risk, but generates revenue by taking a commission or other charge based on the stakes or the prize; and/or
  • Type 4 - controlled skill games.

Maltese law also provides for other games, which will not require a B2C or B2B licence, but would require a different form of authorisation from the MGA:

  • low-risk games;
  • cruise casinos; and
  • amusement machines.

The new law allows operators to have a single licence, rather than require multiple licences as was the case under the previous multi-class system, and which previously limited land-based gaming offerings to the following:

  • casino games;
  • commercial bingo games;
  • gaming devices;
  • sports betting (racecourse betting and sweepstakes);
  • lotteries; and
  • non-profit games.

In view of this, the provisions regulating one kind of activity are spread throughout the regulations rather than contained in one section of the law, and there is no specific provision in the gaming regulations expressly laying down which types of land-based gaming are specifically permitted in Malta. However, the Gaming Authorisations Regulations do provide that where a B2C licence is obtained for the purpose of operating casino games, approval of such licence will be conditional on a concession being granted by the government.

Establishment licensing

Please describe the licensing criteria to operate land-based gambling of each type or classification. Does your jurisdiction limit the number of available licences?

B2C and B2B licences

Licensing criteria are determined by whether the offering is a gaming service (B2C) or a gaming supply (B2B), and this is irrespective of whether the offering is land-based or remote. The MGA may require from the applicant any information, documentation or assurances as may be necessary or relevant for the MGA to examine and determine the suitability of the applicant to hold a licence, depending on the licence category or type of game and, or services that the applicant intends to offer. Where the gaming service falls within more than one of the four game types referred to above, the MGA will have full discretion to categorise the game in the type it considers best reflects its nature.

A person is not eligible to hold a licence issued by the MGA unless established in the EEA.

The MGA shall refuse to grant a licence in any of the following cases:

  • if the application is not submitted in accordance with the established form;
  • if the applicable fees have not been paid;
  • if the MGA, in its reasonable discretion, is not satisfied that the applicant, and all relevant persons, are fit and proper;
  • if the MGA is of the reasonable opinion that the game the applicant intends to offer does not satisfy the minimum requirements of fairness for their respective game types;
  • if it transpires that any information submitted to the MGA is false, misleading, inaccurate or incomplete in a material respect; or
  • if the MGA, in its reasonable discretion, is not satisfied that the applicant: is capable of sustainably financing the gaming service or supply; has the necessary competence, technical know-how and resources to carry out the gaming offering; has a business model to carry the gaming offering in a viable way which is compliant with applicable regulatory instruments, will comply with all regulatory requirements applicable to licensees of the relevant category and with any additional requirements that the MGA considers, on the basis of a risk-based approach, necessary to impose on the applicant, which requirements may include but are not limited to financial safeguards, protection of players and, or the implementation of any policies and procedures.
B2C gaming service

Any person in possession of a B2C licence (excluding a limited duration licence) must pay to the MGA a licence fee, comprising:

  • a compliance contribution, payable for each and every licence period (see question 15); and
  • the non-refundable fixed annual fee of €25,000, or €10,000 with respect to operators providing solely a Type 4 (controlled skill game) gaming service.
B2B gaming service

Any person in possession of a B2B licence constituting the supply and management of material elements of game (under paragraph 3(a) of the First Schedule of the Gaming Authorisations Regulations) will pay to the MGA, in advance, for 12 running months following the issue of the licence and every anniversary thereof, throughout the duration of the licence, a licence fee that shall range between €25,000 - €35,000, or with respect to operators supplying Type 4 gaming supplies, a fee of €10,000.

Any person in possession of a B2B licence constituting the supply and management of software or of the control system itself on which such software resides (under paragraph 3(b) of the First Schedule of the Gaming Authorisations Regulations) will pay to the MGA, a fee within the range of €3,000 - €5,000.

Low-risk games

A low-risk games operator will acquire a low-risk games permit, in the case of:

  • non-profit games wherein the value of the stake does not exceed €5 per player;
  • commercial communication games (games the purpose of which is to promote the sale of goods or services, and the payments required to be made only serve to acquire the promoted goods or services, and not to participate in the game), wherein a single event will not award a prize exceeding €50,000, and also wherein a series of commercial communication games will not cumulatively exceed €100,000 in prizes during any calendar month, and not more than €500,000 during any calendar year; and
  • limited commercial communication games (games the purpose of which is to promote the sale of goods or services and which includes a stake) with a stake that does not exceed €2 per player, and the value of the prize does not exceed €250.

A low-risk games permit is non-renewable and non-transferable, and is valid for a singular event for which it is granted.

Cruise casinos

An operator of a cruise casino will acquire a cruise casino permit from the MGA. This permit, which is non-transferable, is only valid for a term not exceeding the time during which the cruise ship is moored at or within Maltese territory, and only in regard to registered passengers of the cruise ship.

Amusement machines

An operator may only make an amusement machine available for use if registered with the MGA by means of the applicable procedure, despite such gaming service holding the status of an exempt game.

Exempt games

When a game qualifies as an exempt game under the Gaming Authorisations Regulations, it will not require a licence or other authorisation; however, the MGA may establish appropriate regulatory conditions where and to the extent it deems fit and appropriate.

There are no provisions under the Maltese gaming regulatory regime that limit the number of available licences.

MGA power to refuse authorisations

In addition to the causes for refusal to grant a licence as specified earlier, the MGA may refuse to grant such authorisations if:

  • the MGA believes that the gaming offering is not compliant with the regulatory instruments;
  • the MGA believes such authorisation may pose a risk to the reputation of Malta or to the public interest; or
  • insufficient information requested by the MGA has been provided.
Director, officer and owner licensing

Must individual directors, officers or owners of licensees also be licensed or reviewed for suitability?

Yes, such persons must be reviewed for their suitability. The process entails a fit and proper assessment thereof by the MGA carried out on the basis of due diligence documentation and probity assessments with other national and international regulatory bodies and enforcement agencies.

For the purpose of this assessment, relevant persons will include, but will not be limited to, all persons holding a key function in the authorised person, and those holding a direct or indirect qualified interest in the applicant. A qualifying interest will be deemed established at least at 10 per cent, or any lower percentage as may be determined by the MGA. The Gaming Authorisations Regulations permits the MGA to utilise its reasonable discretion to establish which persons involved in the applicant have to be assessed.

Location

May a gambling location be part of a resort, restaurant or other multi-purpose location? What limitations apply?

There are no direct restrictions in terms of location itself. However, controlled gaming premises (defined under Maltese law as premises intended to make available for use, to host or operate one or more gaming device but does not include premises in which gaming is carried out by virtue of a concession by the government or premises in which the only gaming activity being carried out is tombola) must be at least 75 metres away from certain locations, such as educational establishments and playgrounds. Furthermore, a minimum walking distance of at least 50 metres from another controlled gaming premise typically applies.

Passive/institutional ownership

Are there provisions for passive or institutional ownership that allow for exemption or modification of licensing requirements?

No such provisions or exemptions apply under Maltese law.

Responsible gambling

What responsible gambling obligations apply to licensees?

In terms of responsible gaming, the minimum participation age is explained in question 3.

Under the Gaming Player Protection Regulations, operators are obliged to produce sufficient evidence to the MGA indicating that the following objectives have been satisfied:

  • ensuring that proper controls, policies and procedures are in place to prevent gaming by minors and to protect vulnerable persons;
  • ensuring that the interests of all players are adequately safeguarded and that players are provided with information on any and all avenues of recourse they may have if they feel aggrieved by a decision of the authorised person;
  • ensuring that all information relevant to the gaming service, and all information related to responsible gaming, is readily available to players;
  • ensuring that tools are readily available for players or any other persons, authorising them to control their use of gaming services, and to safeguard themselves from the effects of problem gaming; and
  • ensuring that the marketing and advertising of the gaming service is fair and in accordance with the Gaming Commercial Communications Regulations, and any other applicable law.

In terms of the Gaming Commercial Communications Regulations, it is necessary for educational responsible gaming messages to be prominently displayed on all advertisements and promotions related to the game. Additionally, the web-portal address of an entity devoted to responsible gaming must be displayed on all advertisements and promotions. An alternative means of displaying such information will only be acceptable in the event of a spatial restriction, provided such alternative means nonetheless captures the viewer’s attention effectively. Where the alternative means consists of click-throughs, the landing page should not be more than two clicks away.

The abovementioned requirement is not limited to advertising and marketing of games. The Player Protection Directive (Directive 2 of 2018) provides that when gaming services are offered online, licensees must ensure that a link leading to a page including all the relevant responsible gaming information required is permanently visible on the website wherein the services are being offered, and that page must not be more than one click away from any web page or application.

With respect to gaming premises, and controlled gaming premises, licensees are required to make available leaflets or other information regarding at least one organisation that aid persons who have problem gambling issues. Such information must include a responsible gaming message, and must be placed in visible locations in the premises, and next to automatic teller machines, if any.

B2C licensees must ensure that a procedure for self-exclusion is made readily available to players who wish to exclude themselves from playing for a definite or indefinite period, and therefore denying them access to the respective gaming services during the course of such exclusion period. The MGA has announced its intention to introduce a unified self-exclusion system for both remote and land-based gaming operations, in furtherance of its objective to implement additional controls to promote responsible gaming.

Taxes

What type of tax and what tax rate applies to each form of lawful land-based gambling activity?

Provisions on gaming tax have been consolidated into a single legis­lative instrument, entitled the Gaming Tax Regulations. All B2C operators (irrespective of the gaming vertical) will be subject to a gaming tax of 5 per cent of the gaming revenue derived from end customers located in Malta and a compliance contribution that increases depending on the annual revenue made.

With respect to B2C licencees, compliance contributions vary depending on the type of licence and annual gaming revenue:

Type of game service

Compliance contribution for the licence period

Rate (%)

Type 1

For every euro of the first €3 million - €10 million

1.25 - 0.55

For every euro over and above

0.40

Type 2

For every euro of the first €3 million - €10 million

4.00 - 0.60

For every euro over and above

0.40

Type 3

For every euro of the first €2 million - €10 million

4.00 - 0.60

For every euro over and above

0.40

Type 4

For every euro of the first €2 million - €10 million

0.50 - 1.75

For every euro over and above

2.00

B2B licencees are exempt from gaming taxes, but are subject to a duty to pay an annual licence fee to the MGA, which fee depends on the annual revenue generated during the applicable financial year, as provided hereunder:

Revenue

Annual licence fee

Where annual revenue does not exceed €5 million

€25,000

Where annual revenue exceeds €5 million but does not exceed €10 million

€30,000

Where annual revenue exceeds €10 million

€35,000

For providers supplying solely Type 4 gaming supplies

€10,000