An Island Nation’s Triumph: Malta’s Rise as an iGaming Center

## An Island Nation’s Triumph: Malta’s Rise as an iGaming Center

Join Ed Hawkins as he examines Malta’s transformation into a digital gaming powerhouse.

Prior to 2004, Malta was primarily recognized as a small Mediterranean island with a rich maritime history, perhaps even considered a desirable retirement destination. While these attributes remain accurate, Malta has simultaneously emerged as a global frontrunner in the online gaming sector, drawing businesses and experts from every corner of the globe.

What’s particularly noteworthy is that Malta was among the earliest European nations to grasp the potential of this burgeoning sector. More than a decade ago, the country’s policymakers proactively established a comprehensive legal structure for remote gaming oversight. This visionary strategy paved the way for Malta’s present-day achievements, essentially constructing a base that made the island exceptionally appealing to gaming enterprises.

With transparent regulations and enticing financial benefits in place, companies gravitated towards Malta. The Malta Gaming Authority (MGA) has now granted licenses to over 250 remote gaming firms and boasts a total of over 400 licensees. The influence on the Maltese economy is undeniable: the sector now represents a substantial 8% of the nation’s GDP and provides employment to over 8,000 individuals.

Dr. Jose Herrera emerges as a pivotal figure in Malta’s gaming success narrative, his guidance proving crucial in navigating the intricacies of this dynamic landscape.

Mr. Herrera, an attorney by trade and presently the Head of the Council for Business Prowess and Financial Expansion, merits our notice as he narrates the captivating tale of Malta’s online gambling sector. “It commenced with the Lotteries and Wagering Statute of 2002, ratified as a component of a wider restructuring of the betting arena,” he clarifies. “This Statute, which became operational in 2004, cleared the path for the denationalization of the state-run lottery and, more crucially, for the denationalization and market deregulation of other communal holdings in Malta.”

He proceeds, “While the notion of a Digital Single Market is comparatively recent within the European Union, Malta was already pursuing financial diversification 15 years prior, with a specific emphasis on reinforcing its services industry as a part of its economic overhauls at the time. It was evident that information and communication technology, and consequently the entire digital economy with all its sub-domains, held vast potential.”

Herrera stresses, “Distant gaming, being a vigorous, unregulated, and swiftly expanding sector back then, necessitated not only financial consideration but also regulatory supervision due to the intrinsic hazards linked with wagering. It’s extraordinary to ponder that some of the most substantial pan-European entities in the field today had their modest origins in Malta. Malta was genuinely a trailblazer, the initial jurisdiction to implement a regulatory structure for remote gaming, a paradigm that other jurisdictions still imitate presently.”

As a frontrunner in overseeing digital gaming, Malta doesn’t simply comprehend how the sector has transformed (or rather, undergone a paradigm shift), but also its framework, offerings, and ethos. We’ve discovered what succeeds and what falls short regarding oversight, and that’s a primary factor why Malta is such an attractive jurisdiction. We’ve established a sophisticated infrastructure here that bolsters every facet of the gaming sector. Moreover, our regulatory body, the Malta Gaming Authority (MGA), is renowned for being streamlined, proactive, and impactful. This has fostered a transparent and resilient regulatory landscape.”

“While this clarifies Malta’s solid standing in the market, is there a possibility of becoming complacent?” Herrera firmly contends that’s not the situation. “Malta’s financial system is thriving, but the administration isn’t solely motivated by the economic objectives of this industry. We’re guided by policy aims and a dedication to advancement in gaming,” he states. “Foresight and ingenuity are what placed Malta on the map back in 2004. We’re devoted to upholding that inventive spirit in our regulations, our blueprint, and our methodology to sustain Malta’s dominance in the gaming realm.”

Maltas regulatory structure for gaming is on the verge of a significant transformation. The objective is to shift from a checklist-based system to one that actively cultivates a thriving and responsible industry.

Rather than rigid regulations, the updated strategy will prioritize comprehending and minimizing genuine hazards, particularly as technological advancements rapidly reshape the gaming environment.

Carl Herrera, a prominent figure within Malta’s gaming regulatory body, has revealed that revised gambling legislation is under development and might be presented before the year concludes. He emphasized that mere adherence to regulations is insufficient. Regulators must be proactive and modify their approaches to anticipate emerging obstacles.

The impetus for reform intensified following the apprehension of individuals in Malta by Italian authorities, linked to a trio of gaming enterprises. This event highlighted the potential for regulations to become obsolete and underscored the necessity for a more adaptable approach to safeguard consumers and uphold industry ethics. The Malta Gaming Authority (MGA) is diligently pursuing these reforms, aspiring to usher in a period of enhanced effectiveness in overseeing the gaming sector.

Strong measurements and convincing proof of efficacy are both essential.

Malta is meticulously developing its upcoming generation of gambling regulations, carefully considering these aspects, among numerous others. A preliminary version of the new Gaming Act is expected by late November. This Act will establish a comprehensive structure, enabling the relevant Minister and officials to execute customized actions within a unified framework. Our objective is unambiguous: to safeguard the future of our legislation through astute, technology-agnostic regulation that welcomes progress.”

Herrera stresses that an ongoing dedication to an “economic methodology for policy” is also central to the forthcoming strategy. Throughout the years, the majority of sectors within the Maltese economy have been deregulated, with the government relinquishing ownership of many assets it formerly possessed, such as the national lottery, the airport, financial institutions, and telecommunications. Presently, the sole commercially-driven interests retained by the government are in energy and the national carrier, Air Malta.

“This liberalization movement, combined with the government’s economic strategies as lawmaker, policy architect, and regulator, has yielded increased expansion and economic productivity,” Herrera affirms.

“Within other European Union nations, administrations continue to possess and manage resources and business organizations such as gambling establishments, state-run lotteries, telecommunications firms, maritime transport enterprises, and power corporations. This can result in potential inefficiencies and ethical dilemmas, particularly when they also oversee the same sectors. Malta has not adopted this approach, and I believe stakeholders value that.”

Indeed, the corporations involved in this shift appear quite content with it. Enrico Bradamante, Chief Executive of NetEnt Malta (a digital entertainment systems supplier) and Managing Director for European Market Activities, states that Malta’s advantage over other regions is its consistent position at the forefront of the remote gaming sector, earning the industry’s confidence.

“It has drawn in a majority of the online gaming sector within Europe, so a large portion of NetEnt’s clientele is situated in Malta, which holds significant importance for us,” he explains. “Malta presents a very appealing jurisdiction for operations, boasting a highly competent labor pool. The Malta Gaming Authority (MGA), with backing from the government and its collaborators, has established a Gaming Academy to further elevate its allure as an operational center for the island.”

“Nevertheless, what distinguishes Malta as an optimal jurisdiction is not solely its gaming regulations but also its taxation framework and the fiscal incentives provided to investors. These factors have been a primary catalyst behind investment in the sector, alongside the workforce’s expertise within the industry – encompassing not only the employed individuals but also the professionals.”

The iGaming sector in Malta is flourishing, fueled by continuous financial backing from both governmental bodies and commercial enterprises. This capital infusion has not only resulted in remarkable advancements in infrastructure but has also provided a substantial boost to the national economy. To further cement Malta’s standing as a gaming epicenter, a newly formed autonomous organization, the Malta Gaming Authority, is set to be launched. This regulatory body will be entrusted with the responsibility of promoting Malta within both established and burgeoning markets, capitalizing on its comprehensive regulatory structure to propel strategic expansion and generate profitable ventures.

There’s a prevailing conviction that the Maltese government will uphold its pledge of ongoing enhancement and modernization within the gaming domain. Anticipations are high that Malta will persist in providing a business-conducive atmosphere that attracts both seasoned experts and emerging talents. This will be pivotal for corporations to attain sustained growth, particularly as rivalry from other jurisdictions escalates.

Mario Petraglia, the Chief Legal and Compliance Officer at Yggdrasil Gaming, echoes this positive sentiment. He foresees Malta undergoing another period of rapid expansion within the next half-decade. He emphasizes the notable shifts occurring throughout the European gaming panorama and commends the Malta Gaming Authority for its proactive stance in assisting its licensees. Looking forward, Petraglia is confident that the Malta Gaming Authority will bolster partnerships with other national gambling regulatory bodies. This collaborative effort will be essential for various facets, including the exchange of knowledge, optimizing due diligence procedures, aligning technical certification standards, and facilitating more seamless cross-border liquidity for online and shared jackpot gaming products.

They understood that the existing rules were being re-evaluated, and the Malta Gaming Authority (MGA) aimed to implement distinct B2B and B2C permits to simplify processes for businesses. Any adjustment that accelerates and facilitates integration, as a B2B/Type 4 holder, with MGA-licensed B2C providers is a positive development.”

To bolster industry expansion, the Malta Gaming Academy was founded to equip local and global learners with chances to cultivate skills necessary for a gaming career. The academy aspires to be an autonomous, collaborative public-private educational body that generates more pathways for both domestic and international individuals to enter the sector by providing tailored programs that fulfill the gaming field’s requirements.

Lastly, Herrera possesses a clear vision. “My goal is for Malta to become the ‘Silicon Valley’ of online gaming,” he states. “It’s a challenging objective, and one I am fully dedicated to realizing in partnership with the MGA. Our focus persists on being a frontrunner in the gaming realm – for both groundbreaking gaming enterprises and in our regulatory methodology. We acknowledge that our primary obstacle is maintaining efficiency and effectiveness while tackling intricacy and emerging threats. We endeavor to accomplish this by boosting openness, enhancing stakeholder involvement, and ultimately making choices that align with our gaming policy.”

Enhanced protections for users will be established by this, and it will assist in dispelling the notion, regardless of its veracity, that the gaming world is rife with illicit activities and deception.