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How to Start a Gaming Company in Malta?

Prabhat Nigam

| Updated: Jul 20, 2022 | Category: Company Registration

gaming company in Malta

The state of Malta is known to be one of the most attractive destinations for starting a gaming company. Malta has been a pioneer in revolutionising the gaming business across the globe by becoming the first country in the whole European Union to legislate online gaming in 2004. Every internet gaming company in Malta is regulated by an authority called the Malta Gaming Authority (MGA)[1], and consistent efforts have been made from the end of the Maltese government to enhance the gaming law. 

This article aims to list down the reasons why Malta has become the most sought-after destination for starting internet gaming companies with an overview of the internet gaming sector of Malta and the step-by-step process of starting a gaming company registration in Malta.

What comprises the internet gaming industry of Malta?

Internet gaming is related to online games or events involving the act of betting. These games are gaining popularity all over the world, and here is an indicative list of some of the most popular games in the internet gaming industry:

  • Virtual sports and sports betting;
  • Peer to Peer games;
  • Lotteries;
  • Poker;
  • Online casinos and similar games.

Reasons for setting up a gaming company in Malta  

There are a number of reasons for setting up an internet gaming company in Malta. Some of them are as follows;

Accessibility and membership of EU: Malta is a member of the European Union and is located in Central Mediterranean, making it highly accessible from all the major airports of the EU.

Overhauling of MGA: Before MGA was established, there was another regulatory body called the Lotteries and Gaming Authority (LGA). The rebranding of MGA and amendments in its regulatory framework send signs to the gaming industry about responsible gaming, making Malta a more attractive destination.  

Necessary technological and legislative infrastructure: Malta has developed the necessary technological and legislative infrastructure to support the overall development of internet gaming companies.

Mediterranean lifestyle: The Mediterranean easy-going lifestyle is another important factor which has attracted many internet gaming companies to set up their headquarters in Malta.   

What are the different types of licenses required for setting up a gaming company in Malta?

Starting a Gaming Company in Malta is tedious and lengthy, owing to the complexities and various divisions it offers to cover every vertical. There are two types of licenses for carrying on remote gaming business in Malta, namely Business to Customer (B2C) and Business to Business (B2B).

The application is required to be made in one of the four classes established by the statute. The following are the different classes:

Class 1:

The gaming companies offer games that are played repetitively and involve monetary risk. This class is meant for casinos, lotteries, slots, bingo etc.

Class 2:

In this class, the game risk is based on individual events such as sports betting and fixed odds betting. Here, the result of the event determines the bid outcome.

Class 3:

Games that are played against other players where the operator has no risk and usually involve multi-player games. Here, the operator earns commissions from the payers’ transactions.

Class 4:

This license is usually taken by the software vendors who host and manage remote gaming operators from the above classes. Class 4 license holders cannot participate in the game and can only earn through commissions.

Validity: The license granted to an internet gaming company in Malta is valid for 10 years.

Process of starting a gaming company in Malta

A number of stages are involved in starting a gaming company in Malta because it depends on the company’s structure and how many game classes are adopted by the company. Having said that, the most challenging part of the business is obtaining a gaming license, and it is often advised that the promoters should discuss the project at length with the MGA before initiating the company registration process.

Following is the step-by-step process of starting a gaming company in Malta:

Step 1: Set up a company

For a gaming company, the most advised business vehicle is a limited liability company, which is quite an efficient process. Some of the requirements of opening a limited liability company include registered office space, a minimum of two shareholders, MoA and AoA, a bank account in the business’s name, etc.

Step 2: License application process

The license application process with the MGA is a lengthy affair because, at this stage, MGA carries out an in-depth procedure to decide whether a license should be granted to the company. The information related to the company is scrutinised, such as the company’s management, directors, financing, substance etc. Thereafter, MGA demands the following:

  • Fit and Proper review:

Several factors are taken into consideration in the company, such as its financial history, consumer safety, and experience in the field. A number of documents are sought from the promoters. 

  • Business plan:

A detailed Business Plan is required to be submitted, listing the objectives of the business, kind of game and forecasted financial assets.

  • Operational and statutory requirements:

The business has to meet the operational requirements such as games offered on the platform, technical set-up, terms and conditions and the prescribed statutory requirements related to the share capital and others. 

Step 3: Technical and System Audit

After submitting the above-mentioned documents, MGA makes changes in the business model, if required. Before the game goes online, MGA demands the applicant to submit a report on the technical and system audit of the company.

Step 4: Compliance review

Once all the above-mentioned steps have been done, MGA grants a provisional license to the business to operate for the next 6 months. During this period, the company starts operating business but also undergoes compliance review and a number of audits.

Step 5: Official gaming license

Once the review period is over and the gaming license is approved, the applicant receives the official gaming license from MGA.

Conclusion

The above discussion makes it clear that the process of starting a gaming company in Malta is not a quick process. It usually takes 12-18 weeks, during which it undergoes a number of checks and audits. This process takes time to ensure that the game is not used as a platform for giving effect to money laundering practices, data thefts and also to protect the consumers’ privacy.

Read our Article: Types of Companies in Malta

Prabhat Nigam

Prabhat has done his BA LLB (Hons) and has been writing research papers since his law school days. His interest in content writing made him pursue a career in legal research and content writing. His core areas of interest are indirect taxes, finance and real estate.

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