Compliance and proper testing with the Malta Gaming Authority (MGA)
About Malta Gaming Authority
Since 2001, the MGA has been the regulatory body responsible for regulating all Malta gambling laws. Compliance with all the rules and requirements of this state body, as well as ensuring safe and responsible gaming on platforms controlled by the commission, is a prerequisite for effective work under the license of Malta.
The powers of the MGA are as follows:
- issuing licenses for the organization of gambling,
- monitoring compliance with all standards and requirements prescribed by the legislation of Malta and international standards,
- combating fraud and criminal activity in the gaming industry,
- protecting the interests of players and society as a whole.
Verification of candidates for an MGA license
Getting an MGA license is not merely a matter of money. Each candidate undergoes a thorough series of checks, the results of which should yield an affirmative ‘yes’ to the following questions:
- Is the applicant’s business strategy successful?
- Has the correct implementation of the licensing requirements and technical testing been carried out?
- Is the company ready to successfully pass the integrity check that MGA conducts jointly with other national and international regulatory authorities and law enforcement agencies?
The MGA requires companies to undergo a rigorous vetting process before issuing a license. This process is necessary to ensure that the company is able to conduct gambling business and comply with all legal requirements.
Creating a detailed plan for launching a new business or developing an existing one is crucial to the success of your enterprise. Without it, your business may never take off. Successfully passing the verification process for a gambling license business plan is not an easy task if you are unfamiliar with the intricacies of the process or the expectations of the Malta Gaming Authority. Fortunately, we know them! Here we will outline some points that you need to pay attention to.
Gaming industry standards
Standards are the platform that helps your business stand out from the competition by demonstrating the ability to provide high-quality products or services. They serve as a tool for ensuring transparency both inside and outside the company, improving communication between all stakeholders in the process. The goal of the MGA is to provide only the best of the best with the right to develop business projects in the gambling sphere. Candidates are expected to have the necessary knowledge, experience, and resources. They need the determination to scale and expand quickly, if necessary, and to introduce new products or services to the gaming market. The systems and processes already available in the company’s arsenal should contribute to increasing business efficiency. After all, maintaining high standards in the gambling industry and protecting the interests of players is at stake.
The business plan should convince the MGA that the candidate for the Malta gaming license could operate in compliance with the rules and regulations of the gambling industry. The business plan should include a detailed analysis of the market in which the candidate will work, sales and profit forecasts, as well as marketing and distribution, to assess potential risks and business development opportunities. The candidate must demonstrate that they are aware of the competition in the market and know which marketing tools will be most effective.
The direction of the company’s development is necessary. Realistic plans aimed at achieving success in the gambling industry, as well as understanding the needs and requirements of customers, can help prevent possible violations of the law and protect the interests of players by providing them with reliable and legal gaming services.
Operational and legal requirements
At this stage, the MGA performs the following actions:
- Analysis of the license applicant’s work, financial condition, infrastructure, organizational procedures, and technical characteristics of gaming products.
- Confirmation of the availability of necessary licenses, correctness of contracts with gaming product suppliers, player security and confidentiality, and control over financial transactions.
- Verification of the technical characteristics of gaming products to confirm compliance with safety, reliability, and honesty standards. This includes checking random number generators, fraud protection systems, and monitoring the payout of winnings.
The Malta Gaming Authority sets minimum requirements for paid-up authorized capital for candidates applying for a gambling license in Malta, ranging from €40,000 to €100,000, depending on the company’s intended activities (casino operators, sports betting, poker, software vendors, etc.).
Companies seeking multiple licenses in Malta must meet the total financial requirements set by the MGA for each of the license categories for which they are applying.
Preparation for implementation into the technical environment and start of operation
This is the final stage, where independent auditors and testers who have signed a contract with the MGA at a fixed market price begin their work. They will check the operability and compatibility of your product with other systems and applications as well as assessing the level of data protection. Their task is to identify any risk of failures when working in a real environment. If everything goes well, they will note in their reports that the platform and game content meet all the requirements and standards of the MGA.
Control over the company’s activities
After obtaining an MGA license, a company that has become a full participant in the market of gambling in Malta must undergo regular inspections of its activities for compliance with the requirements. Independent third parties with whom the Malta Gaming Authority enters into a contract carry out the checks. Inspections must be carried out according to a specific schedule:
- The first check should take place after one year of operation following the license’s issuance.
- Subsequent inspections depend on the compliance plan established by the MGA.
Thus, it is essential for the licensee to prepare for the inspections and demonstrate compliance with the MGA requirements during the entire license period. Failure to comply may result in the suspension or termination of the license.
Comprehensive Finexmo support
In general, obtaining a license can be quite a complicated process, but the result is worth it. Companies that successfully pass the audit receive a high-quality license from one of the most respected regulators in the industry.
Moreover, you will not be alone! Finexmo guarantees its customers full compliance with the requirements and successful completion of due diligence by the Malta Gaming Authority when applying for a gambling license. As part of the application process, Finexmo provides its clients with the necessary information and documentation, as well as assistance in all aspects of the process.
What types of gaming licenses exist in Malta?
This allows a company to provide gaming services to its business partners. For example, a software provider needs such a license to offer solutions for online casinos, bookmakers, and other operators.
This allows companies to provide services directly to players, without intermediaries. Operators of online casinos, bookmakers, and others need such a license.
This allows offering games for money, including slots, roulette, blackjack, and other games.
This grants the right to organize bets on sports events.
License for slot machines
This allows providing services for the installation and operation of slot machines in retail stores, casinos, and other places.
This allows providing services for lottery draws and sweepstakes.
How much does a Malta gaming license cost?
The cost of a Malta gaming license varies from €5,000 to €25,000, depending on the category. It is important to note that this is only the initial annual cost, and additional expenses may arise during the preparation of documentation and audit stage. In addition, other fees and charges need to be paid during the license acquisition process, such as:
- non-refundable license application fees,
- subsequent annual license maintenance fees,
- system testing fees,
- payments for domain name registrations.
However, many Malta gambling companies are willing to pay for these expenses in order to gain access to the attractive European online gambling market.
Advantages of obtaining a gambling license in Malta
Obtaining a gambling license in Malta has many advantages, making it an increasingly popular destination for entrepreneurs in the gaming industry. Some of these advantages include:
- Qualified and well-maintained infrastructure for gambling operations.
- A tax system that is friendly to entrepreneurs and investors.
- A developed Maltese economy whose participants understand the advantages of fintech, gaming, and esports for further development.
- A prestigious reputation of the gambling license in Malta within the European Union and international community.
- The holder of a Maltese gambling license may be in an advantageous position when negotiating with potential banks and other financial institutions.
- Trust from customers and partners because the license guarantees that your activities are strictly regulated and verified by independent auditors.
Frequently Asked Questions
How does the Malta Gaming Authority affect the functioning of the gaming industry?
The MGA regulates processes in the gaming industry and protects the rights and interests of players. This helps ensure there are no problems with organizing and conducting gambling activities in Malta. Strict control over compliance with all standards and requirements prescribed by Maltese legislation and international standards becomes a guarantee that there is no risk of fraud and criminal activity in the gaming industry. This positive impact benefits all participants in the gaming community.
Is it possible to obtain a gambling license in Malta in just a few weeks?
It is not possible to obtain a gambling license in Malta quickly, even if you have collected all the necessary documents, including a business plan, financial statements, detailed information about the business and its employees, as well as relevant legal documents that are in perfect order. Best-case scenario, the review period for your documents may take a couple of months, plus additional time for technical readiness checks. In some cases, if additional checks and audits are needed, the process may take more than six months.
What taxes and fees are required for holders of a gaming license in Malta?
Holders of a gaming license in Malta are usually required to pay a 5% tax on gaming income as well as an annual license fee and other fees depending on the specific circumstances and operations.