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MGA seen flexing its muscles as Brussels wants answers on new gaming law

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The Malta Gaming Authority has been seen flexing its regulatory muscles in what industry sources say is a cosmetic move aimed at garnering brownie points after parliament passed new controversial legislation for the sector that the European Commission is now asking questions about.

With the European Parliament and European Commission asking the government for more information on a law that could be deemed anti-competitive, the MGA cancelled one licence and suspended two others between 2 and 7 August alone.

In what industry sources say is a move aimed at bolstering credibility after new legislation passed in June effectively barred foreign claims against Maltese betting companies, the MGA took three regulatory actions in the first week of August alone when it took only six other similar moves over the first seven months of the year (one licence cancellation in February, two in April, one in May, one in June when the controversial amendments to the Gaming Act were passed and one in July).

So far this month the MGA suspended the licences of SFJL Holding Limited following gaming regulation breaches. According to the MGA statement, the SFJL failed to notify about changes within the company.

It also suspended the licence of Green Feather, which owns and operates bcasino.com, bcasino.in, boocasino.com, boocasino.co, galacticwins.com and mrfortune.com. According to the suspension notice, all gaming activity related to the sites was to be immediately stopped. The main breaches identified related to the submission of financial information.  The MGA said management accounts and financial statements were not submitted within the required timeframe.

On 2 August, the MGA announced the cancellation of EGMIT Elite Limited’s gaming service licence. Again, the identified included failing to submit financial information on time, failing to pay due taxes and fees and failing to meet commitments to players in a timely manner. The MGA filed a police report and initiated liquidation proceedings against the company.

The crackdown comes as the European Commission is asking the Maltese government for more information on its new and supposedly improved Gaming Act aimed at shielding Malta-based iGaming companies from litigation in other Member States.

Answering a recent European Parliamentary Question from German EPP MEP Sabine Verheyen, the Commission said it was aware of Malta’s draft legislation and that it “is in the process of assessing the compatibility of the draft Bill with EU law and requested the Maltese authorities to provide further information”.

Once it receives and analyses its feedback from the government, the Commission will then “decide on the appropriate follow-up steps” to be taken.

The Malta Gaming Authority issued 75% fewer new gaming licenses in 2022 when compared to its peak year of 2018, figures show.

A recent analysis carried out by The Shift showed how in 2021, the year in which Malta was grey-listed by the Financial Action Task Force, new license registrations halved when compared to the previous year.

Last month, it was reported how Austrian and German lawyers, representing clients against Malta-licensed online gaming companies that allegedly illegally offered their services in Austria and Germany, sent a letter to the European Commission condemning amendments to Malta’s Gambling Act.

Bill No. 55, known as The Gaming Act amendment, introduces a number of changes to “codify in law the longstanding public policy of Malta encouraging the establishment of gaming operators in Malta.”

The bill provides that legal action cannot be brought against a Maltese licensee company, or officials working for a licensee company about the provision of online gaming services as licensed by the MGA. The bill also stipulates that the Maltese courts should refuse recognition or enforcement of any sentence or decision taken by a foreign court in this regard.

                           

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