A Recent Update of Remote Gaming Regulations

Source: Dr Jeanette Carabott¸ PKF Malta

Legal Notice 90 of 2011: Remote Gaming (Amendment) Regulations¸ 2011

With an aim to further regularize issues relating to gaming¸ our legislator has very recently issued a Legal Notice providing for amendments of the Remote Gaming Regulations (hereinafter referred to as the principal regulations):  Legal Notice 90 of 2011 is entitled Remote Gaming (Amendments) Regulations¸ 2011.  This Legal Notice has a retroactive effect.  Both regulations 6 and 9 are deemed to have come into force on 1st January 2008.  Rule 6 excluded the terms “or remote gaming tax” from the principal regulations¸ while Rule 9 provided for the substitution of the Second Schedule to the principal regulations. This second schedule provides for application and licence fees. Upon the application for an issue of a remote gaming licence¸ an applicant shall pay to the Lotteries and Gaming Authority (LGA) a fee of Euro 2¸330.  Furthermore a licence fee of Euro 8¸500 shall be paid by the licensee¸ and upon renewal application¸ a renewal fee of Euro 1¸500 shall be charged. The other rules pertaining to the said Legal Notice came into force from 1st March 2011.

Further amendments regarded the issue of operations. As amended¸ the law now provides that it is necessary to be in possession of a valid licence of the relevant class¸ for a person to operate¸ promote or sell or abet remote gaming.  Such licence must necessarily be issued by the LGA.  However Rule 3(a) further provides that the LGA is not the only exclusive competent authority to give such authorization.   The government or competent authorities of a European Economic Area Member State or any other jurisdiction approved by the LGA can give authorization for the operation¸ promotion¸ selling or abetting of remote gaming.   Furthermore¸ by virtue of the said Legal Notice the LGA may impose requirements and conditions which are inconformity with EU law. Such requirements and conditions must also be inconformity with international obligations.

With regards to application fees¸ Rule 4 of the legal notice provides that the LGA shall not be obliged to process any application or issue a licence unless the relevant non-refundable fees are paid out to the LGA. Moreover the licensee is also obliged to pay the LGA the relevant licence fees¸ renewal fees¸ approval fees and administrative fees as provided within the second schedule of the principal obligations. The LGA may also require licensees to pay actual costs involved for the purpose of conducting analyses and investigations into the licensees’ qualification to obtain and maintain a licence.

Rules 7 and 10 of the Legal Notice provide for the gaming tax and fourth schedule relating to taxation¸ respectively.  A licensee is obliged to pay to the LGA on behalf of the Government an established rate of taxation as follows:

  • A Class 1 licensee is obliged to pay Euro 4¸660 for the first 6 months and subsequently Euro 7¸000 per month for the entire duration of the licence period.
  • A Class 2 licensee is obliged to pay the sum of 0.5% of the gross amount of bets accepted in remote betting operations.
  • A Class 3 licensee shall pay the sum of 5% of real income. The LGA has the authority to issue directives in respect of the computation of real income.
  • A Class 4 licensee shall pay no tax for the first 6 months¸ but