Malta has become the online gambling capital of Europe thanks to its strong regulatory framework. The small Mediterranean island may have a population of just over half a million people, but it’s a giant in terms of its iGaming industry. Some of the world’s biggest and most important gambling companies are based in Malta, drawn in by favourable taxation, strong regulations and other benefits.
Now, many online casinos based in Malta do global business, accepting players from all over the world. However, this has created something of a grey market, especially as many of these casinos still accept players where gambling may not be legal. In recent years, Malta iGaming operators have even been hit with lawsuits, and new legislation aims to address this.
What Is the New Proposed Legislation?
Malta has always had good online gambling regulations, with the Malta Gaming Authority (MGA) carrying out licensing for iGaming operators. The Malta gaming license is seen with a high degree of trust from players and operators around the world, which helps make it very attractive. According to iGamingSEO, a lot of online casinos will obtain the MGA license and then offer their services to those living in countries with different regulatory rules.
However, despite being licensed, these online run the risk of lawsuits for breaking the laws of the countries they’re operating in. Cross-border legal actions against iGaming operators are a real risk, especially when their business is growing into Europe’s grey market. Due to this, the Maltese government has proposed an amendment to the regulations to protect them from legal action.
The new legislation, which has so far not been enacted, would shield businesses from the risk of liability when facing legal actions initiated in foreign jurisdictions. If it passes, iGaming operators with an MGA license would be able to operate legally across Europe without any issues.
How Would This Affect iGaming Operators in Malta?
In addition to making it impossible to start legal actions from a foreign jurisdiction, the law would also prevent a practice known as forum shopping. This is where plaintiffs begin legal proceedings by choosing a jurisdiction that can be more favourable to their claims, regardless of where the operator is based.
Naturally, the new legislation would be a major benefit for iGaming operators based in Malta, especially those that skirt local regulations to offer casino gaming to those in other markets. It would help reduce the impact of legal risks while also ensuring that operators face a fair and balanced legal process.
Online casino companies based and licensed in Malta would then have more freedom to expand across Europe and start accepting players from overseas. Despite this being a legal grey area, the new legislation would essentially protect them from the potential legal risks and allow them to operate with impunity, increasing their market size and potential profits.
Challenges to the New Legislation
While the Maltese government has proposed this new legislation, it hasn’t been enacted yet, and could potentially face challenges. The bill would obstruct European judiciaries, which has meant that several lawyers in Austria and Germany have already objected to it. The law faces a lot of challenges if it’s to be passed, and it could present challenges to Malta too.
By potentially obstructing the European Courts and depriving EU citizens of their right to legal protection, this new bill could land Malta in hot water. The country was put on the Financial Action Task Force (FATF) grey list in 2021 as a result of systemic regulatory failings, and this new legislation could create further issues for Malta’s reputation.
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