International edition
September 20, 2020

Regarding industry stakeholders operating in or from Malta, and detailing the transitory measures

Malta Gaming Authority issues guidelines on Brexit impact

Malta Gaming Authority issues guidelines on Brexit impact
MGA's guidelines detail transitory measures in place for operators to ensure readiness and avoid regulatory disruption.
Malta | 10/17/2019

The notes only relate to regulatory matters falling within the scope of the MGA. License holders will be required to take necessary measures in order to ensure that the entity that holds the licence is established within the European Economic Area, though a transitory period of 12 months will be applicable. The validity of existing recognition notices for licenses not issued by MGA would be one of the main impacts.

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he Malta Gaming Authority (MGA) issued Monday a guidance note on the impact and in preparation of the UK’s Exit from the European Union, a process known as “Brexit.” The purpose of these guidelines is to provide an indication of the potential impact on the gaming industry operating in or from Malta, and the transitory measures that may be availed of in order to ensure minimal impact on regulatory efficiency and the ongoing business.

In a news release, the MGA stated that the guidelines “only relate to regulatory matters falling within the remit of the Malta Gaming Authority, however entities should seek advice and inform themselves of other areas that may impact business, including but not limited to data protection, immigration, employment, duty and copyright matters.”

It added that the contents of the guidance note are of particular importance to entities established in Malta and operating in the United Kingdom, or entities established in the United Kingdom providing services and supplies within Malta, and it also details transitory measures in place for operators to ensure readiness and avoid regulatory disruption.

The first topic addresses Regulation 10 of the Gaming Authorisations Regulations (S.L. 583.05), which prescribes a pre-requisite that a person that holds a licence must be a person established within the European Economic Area. The United Kingdom’s exit from the EU shall mean that persons and entities established in the United Kingdom will no longer meet this criterion, and thus are required to take the necessary measures in order to ensure that the entity that holds the licence meets this pre-requisite. A transitory period of twelve months will be applicable, starting off from the effective date when the EU acquis is no longer applicable to the United Kingdom.

As for Regulation 22 of the Gaming Authorisations Regulations, it prescribes an obligation on entities providing a gaming service, or a critical gaming supply in or from Malta, without having a licence issued by the Authority, but with a licence issued by another Member State of the EU or the EEA, to apply for a recognition notice with the Authority.

Operators making use of, or who intend to use regulation 22 in relation to licences issued in the United Kingdom will be impacted in a number of ways following the United Kingdom’s exit from the European Union: the validity of existing recognition notices; and a potential breach of regulation 3 of the Gaming Authorisations Regulations.

In relation to the first case, the MGA shall process all applications for a recognition notice submitted prior to the actual effective date when the EU acquis is no longer applicable to the United Kingdom. Furthermore, recognition notices issued in this regard will enjoy the full twelve-month term of validity of that recognition notice, which will however not be renewed. Should such entities wish to continue operating in or from Malta, they would need to take the necessary actions, which may include either applying for a licence with the Authority, or apply for a recognition notice in relation to any other EU/EEA licence they may have, for it to be recognised accordingly by the Authority.

The United Kingdom’s exit from the European Union will not impact a number of regulatory causes, and these include:

  •  The Authority’s recognition of random number generator or game certificates issued according to UK standards; 
  •  The Authority’s acceptance of UK licensed and regulated credit, financial and payment institutions for the purpose of holding player funds;
  •  The Authority’s acceptance of the use by licensed entities of UK licensed and regulated payment methods;
  •  The Authority’s acceptance of essential components located in UK territory (without prejudice to the position that may be taken by the European Commission, the European Data Protection Supervisor, and the Information and Data Protection Commissioner in Malta); 
  •  The Authority’s no objection for licensed operators having offices, including key function holders performing their duties from the UK.
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