All you need to know about the Malta Gaming Licence

The Malta Gaming Authority issues one of the most trustworthy licences in the gaming industry. An article by iGambling Business claims that casino players open more accounts with Malta-licenced websites than others. In 2020, MGA-licenced casinos hosted over 19 million active players. Despite a decline in 2021, we have witnessed an 8.7% year-on-year increase.

A robust regulatory framework, a straightforward licencing process, and a high level of trust in the licence among players are reasons cited for why an Australian real money casino for example - and many other international gaming sites - choose the MGA seal of approval.

If you seek the Malta Gaming Authority licence, this article will help inform you about the types of licences it issues, requirements, fees, the application process and benefits.

Types of Malta gambling licences

There are two main types of Malta gambling licences: Business-to-Business (B2B) and Business-to-Consumer (B2C).

• Business-to-Consumer licence: Casino operators with this licence type can offer gaming services directly to players. The licence comprises four gaming services divided into four categories:
  • Type 1: Casino games of chance played against the house. They include lotteries and casino-style games such as slots, blackjack, and roulette.
  • Type 2: Fixed-odds wagering, where participants bet on the event's outcome against the casino. They include sports and event betting.
  • Type 3: This category includes pool betting and betting exchanges. Participants bet against each other. Type 3 games include pari-mutuel betting, poker, and bingo.
  • Type 4: The category comprises all controlled skilled games. Player skill rather than chance is primarily used to set the outcome. They include specific e-sports and fantasy sports.
• Business-to-Business licence: The Malta B2B licence is for companies that offer platforms, products, or services to B2C iGaming operators. It covers software and platform providers, game developers, and various iGaming service providers.

Once acquired, the MGA licence is valid for ten years, after which you will need to reapply.

Malta gaming licence requirements

Below are the standard requirements and documents every officer, shareholder, director, authorised person, and beneficial owner must meet and provide.

• A “good conduct” certificate from the police, not older than three months for every company owner and applicant.
• Pass a “fit and proper test."
• Provide original bank references for all owners and applicants not older than three months.
• Notarised copies of passports for all applicants and owners.
• A detailed business plan.
• A compliance and software audit.
• Information for all gaming software used and third-party agreements.
• All gaming servers and operations must be in Malta.

The owners and applicants must provide all the required documents in English. Where documents are not in English, certified English translations are needed.

Malta's gaming licencing framework works on the “open window” principle. This means the number of licences this iGaming licencing authority can issue is indefinite. Thus, casino operators can apply for a permit anytime, except for the national lottery licence.

Also, only legal individuals in Malta or the EU/EEA with all their casino operations and game services in Malta can apply for a Malta gaming licence.

Malta gaming licence share capital requirements

The minimum share capital requirement of a licensee depends on the licence they wish to apply for. If it's a B2C gaming licence, the share capital requirement varies with the game type.

Organisations with numerous approvals must cumulatively meet the above share capital requirement, up to at least EUR 240,000.

Annual Licence Fees

As per the gaming licence fee regulations, all licenced casino operators must pay the compliance contribution.

The contribution is payable for every licence period. They must also pay the non-refundable, fixed, yearly licence fee. The annual licence fee is payable in advance for 12 running months following the issuing of the licence and every anniversary through the licence period.

Below are the annual and non-refundable fees, which vary depending on the licence type.

• Gaming service licence
  • Type 1–3: EUR 25,000
  • Type 4: EUR 10,000
• Critical gaming supply licence (for organisations supplying and controlling the material features of a game)
  • If a company's yearly revenue falls below $5 million - EUR 25,000
  • If the organisation's annual revenue is less than $10 million - EUR 30,000
  • If the company's annual revenue is more than $10 million - EUR 35,000
  • If the business has a Type 4 licence, EUR 10,000, exclusive of the annual revenue
• Companies providing and taking care of software to process regulatory records, etc.
• If the company's yearly revenue falls below $1 million - EUR 3,000
• If the operator's annual revenue is over $1 million - EUR 5,000

Malta gaming licence countries

Below, we list some countries where the MGA licence is accepted and expected. These countries include:

• Austria
• Croatia
• Denmark
• Estonia
• Finland
• Germany
• Ireland
• Latvia
• Lithuania
• Malta
• Netherlands
• Norway
• Poland
• Slovakia
• Slovenia
• Sweden

Note that this is not an exhaustive list. Also, the regulations for online gambling can change over time. Therefore, casino operators should research and ensure they comply with laws and regulations in every country they plan to target.

How to apply for an MGA licence

Below is a step-by-step guide on how to apply for an MGA license.

Application accepted or incomplete

The MGA licence application must be complete. Also, all the needed information must be uploaded via the LRMS (Licensee Relationship Management System) before a licence application is officially considered to be submitted. 

After the application is received, it is reviewed, and any incomplete application will be set to a one-time preliminary mode for 60 days. Failure to resubmit the complete application within 60 days will cause your application to be rejected and closed off.

One part of the licence application process involves any directors, ultimate beneficial owners (UBOs), and critical individuals submitting a personal declaration form. After the PDF submission, a "request for involvement approval" will be generated by default on the organisation's profile timeline.

This involvement approval lets clients with access to the organisational profile sign up and approve different members in the gaming licence application. This involvement will be created upon submitting the “change in personal information” application. The application will enable anyone accessing the organisation profile to approve or reject involvement requests.

Application review

During the application stage, the MGA assesses if an applicant:

• Is fit and proper to run a gaming business.
• Has a viable business strategy.
• Meets statutory requirements and has the operation capabilities required to fulfil obligations described by law and policy.
• Has fully implemented any technical requirements before going live.

Fit and proper review

In this stage, the MGA conducts a fitness and preparedness test on the applicant. They achieve this by assessing all the details linked to its shareholders, UBOs, relevant essential individuals, and the business viability of the operation. The licencing authority also prohibits investigations in conjunction with different national and international regulatory organisations.

Funding review

The MGA then assesses the applicant's funding sources by examining the capital and overall financials of its ultimate beneficial owners. The financial sources are examined by analysing the economic activity or activities that generate the UBO's finances. It may include examinations of income via employment, business, or inheritance.

The source of funds is the activity, business, occupation, event, or employment that generated the funds used for the gaming operations of the applying entity.

The process of assessing the source of wealth and funds comprises verifying that UBOs are financially stable enough to maintain the licence during their life cycle. It also involves confirmation that the sources are legit.

Business plan and operating policies and procedures review

In this MGA licence application stage, the authority comprehensively analyses the proposed business operations, their funding and viability, and a deep financial analysis of the forecast financials of the applicants.

The MGA expects the applicant to have a detailed business plan with a comprehensive forecast of the operation, including marketing and distribution strategies and growth targets.

Moreover, this licence application stage involves inspecting incorporation documents and the operating policies and procedures as part of the System Documentation Checklist.

Technical set-up review and system audit

This stage involves reviewing the technical documentation of the gaming and control system. Once the review is completed successfully, the authority informs the applicant to implement the system in a technical environment as they prepare to go live. 

The applicant is given 60 days to finish the operation. Within those 60 days, the licence applicant may request an external system audit performed by an independent third party from the pre-approved list of service providers.

Clarifications or requests for further information

The MGA may then ask for more information concerning the licence application. The application will be set to "amendments required" for the licence applicant to submit additional documents as requested.

Any significant changes occurring during the time of a licence application before the approval of the licence will require a new application to be submitted. Major changes include:

• Changes impacting over 75% of the equity ownership, control, or funding of the prospective applicant.
• Changes require a new business plan to be issued. This includes significant changes to the products to be provided or the respective markets, requiring the submission of revised financial projections.
• Changes require a new review of the submitted policies, procedures, and various documents.

To help applicants in the event of significant changes, all information submitted to the MGA that would still be valid will not need to be resubmitted. However, any additional updated documentation, forms, or information and the application form details will still need to be submitted in full via LRMS with the respective application fee.

Licence approved or rejected

After completing the application review, the applicant will be given an MGA licence valid for ten years. In the case of rejection, the process must be started over anew. 

Advantages of a Maltese gambling licence

Below are a few reasons why casino operators should consider a Maltese gambling licence:

High credibility

The MGA works closely with the Maltese government to ensure the interests of players and businesses are protected in a safe gambling environment. 

The MGA also regularly suspends the licences of operators who fail to adhere to their compliance obligations. For this reason, the MGA has an excellent reputation and a history of ensuring strict compliance with regulations.

Companies with MGA licences are usually regarded as more credible because the licence is a testimony that the operator is fair, honest, and transparent.

Fair games

Casino operators with MGA licences must undergo a regular check to ensure the gaming mechanisms of the company are fair, honest, and untampered with or rigged by the operator.

Independent licenced testing firms not affiliated with the casino operator also test and prove online games to ensure that the software does not have pre-determined results. The MGA also helps enforce the transfer of prize money to the players. Therefore, operators with MGA licences are considered safe and fair to play at.

Gaming friendly

iGaming has been an integral part of the economy. The native workforce is highly skilled and experienced in the gambling sector. Malta has a large pool of Maltese and English-speaking employees. It also has a significant number of ancillary gaming service providers, such as software, hardware, advertising, data, and marketing.

Player trust

Having proof of an MGA gambling licence on your website will help you earn the trust and confidence of players. In such a competitive market, it is crucial to get players to have faith in your services.

Trust in the MGA licenses is driven by considerable heights of player protection and thorough control mechanisms enforced by the Malta Gaming Authority. Additionally, the authority ensures high anti-money laundering standards and full compliance with applicable EU legislation.

Stability

Malta has been a fully-fledged EU member since 2004. It is also among the British Commonwealth members.

The licencing authority is a pretty stable body, both socially and politically. Economically, Malta has emerged with a consistently solid economy driven by technology, innovation, and financial services.

The authority is known as friendly and welcoming to operators, with an adaptable regulatory environment for technology-related firms.

Double taxation treaties

The Maltese government is part of 70+ varied double taxation treaties with different jurisdictions globally. The government is also actively looking to register more for the mutual advantage of citizens of those countries. 

This means that an organisation with a Maltese online gambling licence may not pay tax in their original homeland.

Access to more markets

Casinos with a Maltese online gaming licence can provide services in various countries. They, however, cannot offer gambling to players in FATF-blacklisted countries and regions where online gambling is prohibited. Also, they can't provide services in areas where a locally issued licence is needed.

Final thoughts on the Malta Gaming Authority Licence

As unveiled above, the MGA licence has many benefits. However, these merits come at a hefty price. If you wish to secure a licence, financing will be a major focal point. 

The licence application process is not only lengthy but also complex and expensive. Applicants must also submit many documents, be patient, and attend in-person meetings with authorities.

However, looking for an EU home is an excellent decision if you are a big gaming company or a brand with a decent budget. Visit the Malta Gaming Authority website and start your licence application process.

Players must be 18+ to partake in any gambling or online casino activity. Players who require help are urged to seek it. Players play at their own risk.