Promising outlook for future of Maltese gaming industry, 2019 figures show

Gaming contributed around 13.6% of total value added to the economy between January and June 2019, with 311 new full-time equivalent jobs compared to 2018

The Malta Gaming Authority (MGA)'s performance report for the first half of 2019 has indicated a promising outlook for the future.

The overview leaves plenty of room for positive predictions regarding the rest of 2019. Whether such predictions will be accurate is something the regulator will re-address in June 2020, when the full-performance report for 2019 is expected to be released.

The metrics show involvement in various key projects, aimed at reducing problem-gambling, as well as illegal activities associated with the industry. Furthermore, the MGA has shown an increase in cooperation with similar regulatory bodies, from other regions and countries around the world.

Closer cooperation with the Maltese authorities

The reduction of problem-gambling and illegal practices have been at the core of new gaming regulations, across several key regions in 2019. Regulatory bodies from some of the most saturated markets have taken concrete steps toward suppressing predatory behaviour in the industry.

The MGA is spearheading the efforts within its jurisdictions, utilising several projects aimed at reprimanding and ultimately removing problematic actors.

The regulator’s efforts in the period under review, show a massive increase in anti-money laundering efforts. They have also taken combating the funding of terrorism to a new level, with improved intelligence gathering as well as deepened cooperation with relevant government authorities. The MGA has recognised that uncovering and suppressing such illegal activities pivots around them working with relevant law enforcement agencies.

As a result, the MGA has signed a Memorandum of Understanding with the Malta Police Force, thus greatly improving the flow of information and intelligence between the two organisations. Working closely with law enforcement will allow the MGA to be more efficient in its effort to combat illegal activities.

Building stronger ties with international counterparts

One of the key aspects of the recently released performance report is improved cooperation with international counterparts. Namely, the MGA having hosted a number of international delegations, including their counterparts from Ireland, Ghana, and Lagos, with the goal of furthering the cooperation with these authorities.

During the period of January to June of 2019, the MGA received 23 international cooperation requests from all over the world. Additionally, the Authority sent out 33 such requests to its international counterparts in the same periods.

The nature of these requests was indeed diverse. MGA and its counterparts exchanged information regarding sports integrity and adverse media reports, as well as illegal criminal activity by the players.

A large portion of requests had to do with operator licenses as well as operators working outside the limits of their licenses.

Peter Spiteri, Chief Officer Finance & Programme Management of the Authority has shared his take on MGA’s cooperation with international counterparts: “During the past months, the MGA has increased the co-operation efforts with the international counterparts, relevant authorities and other regulatory bodies to further improve the efficacy of co-operation and exchange of information for better regulation.”

Maintaining a strict posture

During the six-month period, MGA’s Fit & Proper committee was busy, to say the least. They reported 19 meetings of the unit, held from January to June of 2019, where the committee arbitrated some 107 decisions.

Among those, the committee issued a total of 13 refusals to various companies, which were not deemed fit and proper according to the MGA’s rules. Some of these decisions were based on individuals associated with said companies.

Maintaining a strict posture when it comes to enforcing Malta’s gaming regulations remains the MGA’s policy. The Authority issued 11 notices of reprimand during the six-month period, suspended 11 licenses and revoked 7 from various holders.

With these actions, the MGA has once again emphasized the importance of following the gambling and gaming regulations within its jurisdiction.

The Spelinspektionen Memorandum

One of the key projects outlined by the report is the signing of Memorandum of Understanding with Spelinspektionen in March 2019.

Spelinspektionenthe Swedish Gambling Authority, and MGA have agreed to open a direct channel between the two regulators and greatly improve the exchange of information as well as experiences going forward.

Sweden is currently one of the most popular regulated gaming markets in Europe. As such, it has been the subject of strict regulation. Spelinspektionen enjoys the reputation of being efficient as well as innovative when it comes to maintaining the market organised and safe for players, as well as operators.

Working closer with Spel will allow both authorities to gain valuable information as well as lessons learned from two high-traffic jurisdictions.

Heathcliff Farrugia, MGA’s CEO, offered a statement following the signing of the memorandum: “This MoU, signed with the Swedish Gambling Authority, is an important step towards achieving both our respective regulatory goals in vital areas of mutual interest, especially since the MGA and the Swedish Gambling Authority share a significant number of operators licensed by both regulators. We are eager to start this mutually beneficial journey with our Swedish counterpart.”

Farrugia further emphasised the need for “fostering relationships with fellow authorities” as that is the only way for MGA to reach its goals and objectives when it comes to remote gaming, due to its cross-border nature. 

Recorded growth potential

Aside from the suppression of illegal activities, the MGA’s recent report also shows a clear growth trend in several areas, that are key for both the industry as well as Malta’s economy. It shows that the gaming industry has had a positive impact on the Maltese economy in several different ways.

Namely, the gaming industry has contributed around 13.6% of the total value that has been added to the economy in the period between January and June 2019. The MGA has also recorded 311 new full-time equivalent jobs within the gaming industry compared to the same period last year.

These metrics leave room for predictions regarding the gaming industry’s overall impact on the Maltese economy for the whole of 2019.

Following the release of the document, Peter Spiteri offered his comment regarding MGA’s performance within the specified period: “Despite various challenges facing the sector over the past years, the gaming sector continues to consolidate its standing within the Maltese economy. The MGA strives to ensure that the industry in Malta remains compliant with an evolving set of regulations that cater to newly emerging risks and maintains a strong reputation.”

Spiteri also addressed the importance of the new Gaming Act that came into effect on January 1, 2019.

He recognized that the MGA’s role in the implementation of the new act as well as the efforts undertaken within the first 6 months of the new act coming into effect: “During the first six months of 2019, the MGA continued with the implementation of the Gaming Act for the land-based industry that became subject to the new law from 1 January 2019. A lot has been done by the Authority to ensure that the implementation was completed effectively and all systems and procedures cater to the new requirements”, said Spiteri.

A positive outlook

The MGA’s interim report has validated this organisation’s efforts to consolidate its position within the Maltese economy. The MGA continues to maintain Malta’s reputation of being an attractive place for operators who are looking to establish themselves in the global gaming industry.

The performance outlined in the report shows that the MGA strives to ensure complete compliance of the domestic gaming industry, thus making it more competitive on the world stage. Such practices and policies promise to yield continued growth, both in terms of the industry itself as well as the Maltese economy as a whole.

The MGA has recognised the importance of new and emerging markets, especially within the US and South America. The influx of new players opens all kinds of opportunities for the MGA, as one of the leading regulatory bodies in the industry.

The authority has also outlined the changing climate in several European countries as something the Authority will have to focus on. With a growing number of businesses located in Malta operating in said markets, the MGA will have to work on finding answers for the changing regulations in these countries.

With that said, the future is looking bright per the interim report. All of the important metrics are in the green. The release of the full-year report in June of 2020 will remove any doubt and show whether the current predictions are true. This paper will include annual reports for the financial year ending on 31 December 2019.