Malta Gaming License
A gambling license is crucial for businesses wishing to operate in the gambling sphere. Malta, a small island nation in the Mediterranean, has become a popular destination for gambling companies seeking permission due to its favorable regulatory environment and attractive tax rates. This article will provide an overview of obtaining a gambling license in Malta and the key considerations businesses should consider when entering the Maltese gambling market.
A Malta gambling license offers numerous benefits for operators seeking to enter the online gambling industry:
- Available access to the EU’s single market and a large consumer base;
- A high level of credibility for licensed operators;
- The favorable tax regime for gambling businesses, with a reduced corporate tax rate and a reduced VAT rate for gambling services;
- A highly skilled and multilingual workforce with a strong emphasis on education and training;
- A robust technological infrastructure, reliable internet connection, and a well-developed telecommunications network.
To obtain gambling permission, operators must meet various requirements established by the Malta Gaming Authority (MGA). These requirements are in place to ensure that all gaming practices in Malta are conducted fairly and transparently and to protect the interests of both players and operators:
- A readiness to conduct gaming business
This means that the applicant is ready and able to operate a gambling business, and has a clear understanding of the associated risks and responsibilities. This includes having a business plan, sufficient resources to support the business, and a clear understanding of the regulatory and legal requirements.
- Adequate preparation from a business strategy perspective
The applicant must have a well-defined business strategy aligned with the company’s goals and objectives. This includes developing a comprehensive marketing plan, identifying target markets, and establishing clear revenue goals and projections.
- The ability to meet operational and statutory requirements as prescribed by law and policy
This involves meeting all regulatory and legal requirements related to the operation of a gambling business, including licensing, compliance, and reporting. This includes appropriate anti-money laundering and social responsibility policies and procedures.
- Successful gaming system implementation and review in a virtual environment before the official opening
The applicant must have successfully tested and reviewed the gaming system in a virtual environment before launching the business. This ensures that the system is functional, meets all technical requirements, and provides a smooth and high-quality user experience for customers.The applicant’s incorporation documents, games, business processes, rules, terms, conditions, policies, procedures, and technical documentation of the gaming system are evaluated during the examination process. The permission type determines the minimum issued and paid-up share capital the permission requires.
For Type 1 or Type 2 licenses, the applicant must have a minimum of €100,000. For Type 3 or Type 4 licenses, the applicant must have a minimum of €40,000.
Types of Gambling Licenses in Malta
Four types of gambling licenses are available, each catering to different gaming practices. These licenses are issued by the Malta Gaming Authority (MGA) and are subject to strict regulatory Malta gaming license requirements.
Type 1 License
This type covers games based on chance, including casino-style games, lotteries, and slots. The operator must be physically present in the country and meet the MGA’s technical and financial requirements. The bare minimum equity share for this type is €100,000.
Type 2 License
This type covers sports betting, including fixed odds and spread betting. The operator must be physically present in the country and meet the MGA’s technical and financial requirements. The bare minimum equity share for this type is €100,000.
Type 3 License
This license covers operators who provide g ames based on peer-to-peer gaming, such as poker and other skill-based games. The operator may be based outside Malta but must have a Maltese-registered company and comply with the MGA’s technical and financial conditions. The bare minimum equity share for this type is €40,000.
Type 4 License
This type covers software vendors who provide gambling software to other permissions. The vendor may be based outside the country but must have a Maltese-registered company and comply with the MGA’s technical and financial conditions. The bare minimum equity share for this type is €40,000.
Regulation of Online Gambling in Malta
- Malta has a robust online gambling regulatory structure overseen by the Malta Gaming Authority (MGA). The MGA regulates all aspects of online gambling, including licensing, compliance, and enforcement.
- To operate an Internet gaming business in Malta, operators must obtain valid permission from the MGA. The rigorous licensing process involves meeting strict criteria related to financial stability, technical capability, anti-money laundering procedures, and social responsibility practices.
- Once granted a gambling license Malta, operators are subject to ongoing monitoring and supervision by the Malta Gaming Authority (MGA). This includes regular audits and inspections to ensure compliance with regulatory requirements. The MGA also has the power to impose sanctions, including fines and revocation of licenses, for non-compliance.
- In addition to licensing and compliance, the MGA is also responsible for protecting players from problem gambling. This includes implementing measures to prevent underage gambling, promoting responsible gambling practices, and providing support and resources to individuals at risk of developing gambling-related problems.
- One of the critical features of Malta’s regulatory structure is its focus on international cooperation. The MGA has signed numerous agreements with other regulators and law enforcement agencies to facilitate data sharing and collaboration in the fight against illegal Internet gaming and other forms of criminal activity.
Taxation in Malta
Malta has a favorable taxation system for gambling businesses, which is one of the reasons it has become a popular destination for operators seeking gambling permission. The Maltese Income Tax Act and the Value Added Tax (VAT) Act regulate the taxation system.
For companies licensed by the Malta Gaming Authority (MGA), the corporate tax rate is 35%. However, companies may be eligible for a reduced tax rate of 5% under the Maltese Gaming Tax Regulations. To qualify for this reduced rate, the company must meet specific criteria, such as being registered in Malta and having at least one resident director.
In addition to corporate tax, gambling operators are also subject to VAT. The standard VAT rate in Malta is 18%, but gambling services are subject to a reduced rate of 5%. This includes Internet gaming services, which are treated the same as land-based gambling services.
Another advantage of Malta’s taxation system is its participation in the European Union’s (EU) VAT regime. This means that gambling operators licensed in Malta can benefit from EU-wide VAT rules, such as the VAT reverse charge mechanism, which allows operators to shift the responsibility for VAT payment to their customers in certain circumstances.
Furthermore, Malta has signed double taxation agreements with over 70 countries, which helps to avoid double taxation on gambling operators’ profits.
FAQ about Maltese gambling license
How to get a Malta gaming license?
- To get a gambling license in Malta, businesses must meet the Malta Gaming Authority (MGA) requirements. This includes legal and financial compliance, technical standards, anti-money laundering policies and procedures, and social responsibility practices. The process can be complex and time-consuming, and it is recommended to seek the assistance of a professional advisor to ensure a successful application.
How much does a gaming license Malta cost?
- The price varies depending on the license type and the gaming practices’ scope. Application fees range from €2,330 to €8,500, and annual fees range from €1,165 to €8,500. Licensees must also meet minimum share capital conditions ranging from €40,000 to €100,000.
In which countries can the Maltese gaming license be used?
- Numerous countries worldwide, including most EU member states, recognize and accept the Maltese gaming permission. The permission is also recognized in several non-EU countries, such as Canada, Australia, and New Zealand. However, operators should check each country’s specific conditions and regulations where they intend to operate.
How long does it take to obtain a gaming license in Malta?
- The time it takes to obtain a gaming license depends on several factors, such as the application’s completeness, the permission type, and the business’s complexity. On average, the process can take between 12 and 16 weeks, although it may take longer if additional documentation or data is required.
What categories of gambling licenses are available?
- Four categories of gambling rights are available, each catering to different gaming practices. These include Type 1 for casino-style games and lotteries, Type 2 for sports betting, Type 3 for peer-to-peer gaming, and Type 4 for gambling software providers. Each permission type has different conditions and fees, and operators must carefully consider which type is appropriate for their business.