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There are many reasons for considering Malta as the ideal base for gaming operations. These include:
- an efficient and relatively inexpensive licensing process
- low Malta Gaming tax
- the lowest effective corporate tax rate in Europe and the availability of a highly attractive participation exemption
- a stable political environment
- a modern and continuously improving legal and tax framework
- a gaming sector characterized by an accessible and flexible regulator
- an excellent telecommunications infrastructure
- equipped with modern hosting and co-location facilities
- knowledgeable, flexible and multi-lingual labour force
The Lotteries and Gaming Authority (LGA), is Malta’s regulator for remote gaming. The LGA may issue licenses to all types of providers of remote gaming,
including those involved in casino-style games, poker, sports betting, betting exchanges, P2P, skins and lotteries through all types of technological media including the internet, mobile, telephone and fax, among other media.
Type of Licenses
- Class 1 – applicable to operators managing their own risk on repetitive games (casino-type games, skill games and online lotteries)
- Class 2 – applicable to operators managing their own risk on events based on a matchbook (fixed odds betting, pool betting and spread betting)
- Class 3 – applicable to operators promoting and abetting gaming from Malta & taking a commission from promoting and/or abetting games (P2P, poker networks, betting exchange and game portals).
- Class 4 – a license to host and manage remote gaming operators, excluding the licensee himself.
- Class 1 on 4 – applicable to operators managing their own risk on repetitive games (e.g. casino-type games, skill games and online lotteries) operating on a 3rd party platform duly licensed by the LGA.
- Class 3 on 4 – applicable to operators promoting and abetting from Malta & taking a commission from promoting and/or abetting games (P2P, poker networks, betting exchange and game portals) operating on a 3rd party platform duly licensed by the LGA.
- Class 1 – €4,660 per month during the first 6 months after issue of the license, and €7,000 per month subsequently for the entire duration of the licence period.
- Class 1 on 4 – €1,200 per month
- Class 2 and Class 2 on 4 – 0.5% of the gross amount of bets accepted
- Class 3 and Class 3 on 4 – 5% on net income (net income is defined as revenue from rake less bonus, commissions and payment processing fees, i.e. e-commerce fees)
- Class 4: No gaming tax for the first 6 months of operation; €2,330 per month for the subsequent 6 months and €4,660 per month subsequently for the entire duration of the license. Provided that the hosting platform shall also pay a monthly tax of €1,165 for every operator it hosts and which operator is licensed by the government or competent authority of an EEA Member State (not being Malta).
Every license issued by the LGA will be valid for a period of 5 years. The initial application fee is €2,330 whereas an annual license fee of €8,500 is payable every year. Any license is valid for a period of 5 years, and upon its termination renewal involves a fee of €1,500.
Like any other company registered in Malta, a gaming company initially suffers a corporate tax of 35%. However, shareholders may benefit from a substantial refund of the tax paid by the company upon a distribution of profits through dividends or bonus shares.
Generally, shareholders would incur an effective tax rate of 5% upon claiming the tax refund. Such effective tax rate is the lowest in Europe..
Application Process for a gaming license
The process of obtaining a Maltese remote gaming license is normally split into 3 stages:
1st Stage: Initially the LGA performs a fit and proper test on the applicant including an assessment of the competence of the persons involved to carry out gaming. At this stage the applicant would be required to submit various due diligence documents and a formal business plan.
2nd Stage: At this stage the LGA carries out an in-depth examination of the overall operation including the games to be offered, the business functions, the gaming rules, player rules and the controls to be installed.
3rd Stage: If stage 2 is completed successfully, the LGA issues a temporary license called Letter of Intent (LOI). The LOI gives the applicant the right to operate remote gaming from Malta with the condition of obtaining a certification of compliance within six months. The
applicant may then establish the business, conclude all agreements, find a service provider to host its equipment and acquire appropriate premises. Following the six month period, the applicant may request to be certified and, if successful, a license for a 5-year period is issued.
Setting up a Gaming Company in Malta
The incorporation of any company in Malta is generally smooth and prompt.
Maltese companies used for remote gaming must clearly state in their Memorandum of Association that their main object is the conduct of remote gaming operations.
Incorporation of a Maltese Company requires a minimum authorized and issued share capital of €1,165 out of which only 20% needs to be paid. Notwithstanding this, it is possible for the LGA to request remote gaming operators to increase the share capital to:
- Class 1: €100,000
- Class 2: €100,000
- Class 3: €40,000
- Class 4: €40,000
- Class 1 on 4: €100,000
Every company registered in Malta, must have at any time a company secretary (an individual), a director (resident or not, individual or corporate). Specifically for gaming companies, the law requires also the appointment of a key official who also has to be a director of the company and must be resident in Malta.
A Maltese company must file annual audited accounts with the Maltese Registrar of Companies. The books of the Company may be kept overseas. Nonetheless, the Company’s accounts must be audited by a local auditor annually.
How we can serve you
last updated on: 18th February, 2014
- We strive to provide current and aspiring gaming operators in Malta with knowledge, global resources and top quality
- Our hands-on experience in the remote gaming sector has furnished us with considerable expertise across all types of gaming sectors and licenses
- We have developed an excellent relationship with the LGA which further evidences our claims of a highly reputable firm
- Being part of a global network enables us to service gaming clients which operate in various jurisdictions while ensuring that the combination of our expertise together with that of our counterparts adds further value to such clients
- Besides providing full assistance in respect of the license application process and the setting up of a Maltese company, we can also assist in the running of the company through detailed evaluations of operational and financial performance.