News & Articles

EGR B2B Awards 2018
Afilexion Alliance, a partnership between Avviza and GTG Advocates, was shortlisted for two prestigious awards by EGR (eGaming Review Magazine).  Afilexion Alliance was shortlisted as the Best Corporate Services Provider 2018 and Services Rising Star 2018.

The EGR B2B Awards reward and celebrate the very best service providers in the online gaming industry, recognising the achievements of suppliers from across all the major iGaming disciplines.

The winners will be announced during the awards ceremony taking place on Wednesday 20 June at The Hurlingham Club, London.

 

 

Malta’s new Gaming Bill presented to Parliament with a view of being enacted in July 2018.

 

The Government of Malta presented a Bill in Parliament on the 13th March 2018 to repeal the Gaming Act, 1998 and the Lotteries and Other Games Act, 2000, in order to replace it with a new omnibus Gaming Act that will see all forms and models of gambling, including online gaming, regulated under one singular Act.

The Bill, which is a result of an extensive public consultation process, which saw 53 formal reactions, including one from Afilexion Alliance (of which Avviza forms part of), is being projected by the drafters as a regulatory framework to ‘future proof’ Malta as a jurisdiction of excellence.

Malta was the first EU Member State to regulate online gaming in 2004, with the new Gaming Act introducing new regulatory concepts 18 years after the enactment of the Remote Gaming Regulations.  Whilst the new Gaming Act will continue to capitalise on the effective regulatory framework that saw Malta becoming the Gaming Capital of Europe, however the new Act will introduce regulatory innovations that will see Malta continue to cement its leading position in gaming regulation, whilst allowing for further growth of the sector.  The proposed new Gaming Act, which is targeted to come into force in July 2018, will see the streamlining of its current multi-licensing classes to two main licenses – an umbrella B2C license and a B2B license, whilst it sees some interesting regulatory innovations, which include:

  • A ‘cryptocurrency friendly’ framework, insofar as one of the articles in the law could allow for such payments in the future due to the definition of “money and money’s worth” which includes “currency accepted as legal tender in the jurisdiction of its issue, virtual currencies, units of value, token of value, goods, services and any form of property which may be traded, sold, converted into or otherwise exchanged for money, goods or services”
  • Incentives, in the form of zero compliance contribution fees for the initial months for ‘start-up’ operations,
  • The divesting of the existing Key Official Role, to a number of Key Positions, thus segmenting the regulatory compliance functions across a number of authorised individuals
  • The introduction of an Administrative Review Tribunal, allowing licensees to appeal to an independent body on enforcement decisions taken by the Regulator
  • The introduction of the notion of ‘administration’ for those licensees that will be going through financial difficulties and/or winding down
  • The removal of gaming taxes for B2B operators, and the introduction of a revenue based (on GGR) scaled gaming taxation system for B2C operators

The new Gaming Act has many more changes and innovations to those mentioned above, including principles that further strengthen player protection.  In a nutshell however, the proposed new gaming law would not only further strengthen Malta’s reputation and position from a regulatory point of view, but will also provide for a more business friendly environment for B2C and B2B operators and for game developers.

The Bill will be debated in Parliament over the coming weeks, with a view that following Parliamentary scrutiny and receiving a no objection from the EU’s TRIS process, will be come into force in July 2018.  Transitory provisions are also included in the new Act so as to allow the existing Licensees transit smoothly towards the new regulatory framework.

Should you have any queries about the Bill, or require any assistance in applying for remote gaming licenses, please contact us on rp@avviza.com

 

 

MGA publish new fees and taxes ahead of New Gaming Act – Part 2

 Part 1 titled MGA publish new fees and taxes ahead of New Gaming Act dealt with the new framework of Compliance Contribution Fees.  See http://www.avviza.com/2018/01/malta-publish-new-fees-and-taxes-ahead-of-new-gaming-act/  Part 2, addresses the new license fees and other related fees.

 License Fees

The Legal Notice 409 of 2017 also delineated the new license fees which are applicable from 1st January 2018 for new license applicants, and from 1st July 2018 for existing licensees.  The license fees are as follows:

Although the new license fees are higher from the previous license fee of €8,500 per annum, however it should be noted that the new regime provides for a singular B2C license compared to the previous multi-licensing framework.  Under the previous regime, if an operator held  Class 1 (Casino), Class 2 (Betting) and Class 3 (Peer to Peer) licenses, the annual license fee was of €25,500 per annum (€8,500 x 3 licenses).  The same applied if a Casino B2C operator offered for instance games from 4 different B2B platforms, where such an operator would have held 4 Class 1 on 4 licenses amounting to €34,000 per annum (€8,500 x 4).  Thus, the new license fee is effectively lower compared to those who held 3 licenses or more.

 

A point that needs to be highlighted is that B2B (termed as Critical Gaming Supply) platforms’ license fee ranges from €25,000 to €35,000 per annum, depending on the level of revenues earned over a year. However, it should be noted that B2B operators will not be subject to a Compliance Contribution fee.  Thus, by way of comparison, an established 2017 B2B licensee, holding one B2B license would have paid €8,500 license fee and €55,920 in gaming taxes (total €64,420).  Thus, as from January 2018, a B2B licensee will be paying between €29,420 and €39,420 less in aggregate compared to 2017.

For those B2B ‘Critical Gaming Supply’ Operators which do not supply and manage the control system, where the term ‘management’ means the provision of ongoing active maintenance and support which is indispensable to the provision of the gaming service, then a different licensing structure would apply as follows:

 

 

 

Namely the above license fees would apply for B2B ‘Critical Gaming Supply’ Operators which (a) only supply and manage material elements of a game or (b) supply and manage software, whether as a stand-alone or as part of a system, to generate, capture, control or otherwise process any essential regulatory record.

Other Fees

The Legal Notice 409 of 2017 also lists an array of fees, all of which being one time fees.  The most relevant fees are listed hereunder.

  • License application fees raised from € 2,330 per license to € 5,000 per license application. However, a B2C license can cover more than one agreement with B2B providers and covers all types.
  • Should an additional type be added, a further €1,000 authorisation fee needs to be paid to the MGA
  • Key Function Approval (application) €50 per applicant
  • Request for approval of major changes in software / infrastructure: €1,000
  • Request for the addition of a new domain name: €100 per domain

MGA publish new fees and taxes ahead of New Gaming Act. (Part 1)

 

The end of 2017 saw Malta publish the Legal Notice 409 of 2017, titled the “Gaming Licence Fees Regulations”, which amended the Remote Gaming Regulations (S.L. 438.04).

 

The regulations, which were brought into force as from 1st January 2018, sets the scene to the introduction of the new Gaming Act, which is expected to come into force in the summer of 2018.  The phasing in, to the new Gaming Act, is more prominent as although this regulation falls under the current legal framework (Remote Gaming Regulations of 2004), it also defines the new license categories (Type 1 to Type 4) which were expected to be defined in the new Gaming Act.  The new licensing framework and ‘taxation’ framework (the latter previously defined as variable license fees) were originally published as part of the July 2017 Public Consultation document on the new Gaming Act.

 

The public consultation exercise, which was spearheaded by the MGA seems to have had an impact on the final framework, as some ‘taxation’ fees were adjusted and lowered, whilst the novel concept proposed as part of the Public Consultation document, that is allowing start-ups to enjoy from a 6-month exemption on compliance contributions (formerly termed as gaming taxes), has been extended to 12 months as published in the Gaming Licence Fees Regulations.

 

The regulations set the Compliance Contributions (previously termed as gaming taxes) per license Type, which will come into force as from 1st July 2018. The regulations also set minimum and maximum amounts per license Type which were not present in the proposed fees in July 2017, whilst the compliance contributions for License Type 1 changed compared to the July 2017 proposed fees. Some minor adjustments were also made for Type 2 and Type 4 licensees as some of the applicable gross gaming revenue bands were broadened, thus effectively slightly reducing the tax burden for the higher revenue generators.

 

Following these amendments, the fees (Compliance Contributions) for the four License Types are set out as follows:

The fixed licence fee for Type 1, Type 2 and Type 3 licensees has been fixed at €25,000, while that for operators providing solely Type 4 gaming services, the licence fee has been fixed at €10,000.

A transitory period is envisioned for current licensees to continue paying in accordance with the current regulations up until 30th June 2018 making the new licence fees effective as of 1st July 2018. New licensees will be subject to the requirements of the New Regulations and new set of Compliance Contributions, even during the said transitory period.

 

For current licensees, a reconciliation will be carried out to calculate the difference between the fees paid under the old regulations for the first six months of 2018 and the fees to be paid for the remaining six months under the new regime.

Any excess provisional payments made by licensees will be carried forward and available for set-off through a tax credits equivalent. Licensees that would have paid less than the amounts due are then required to pay the difference by 20th October 2018.

Wishing our clients a Happy Christmas and a Successful 2018.

Our Offices will be closed for the festive season between the 26th – 29th December 2017 and on the 2nd January 2018.

Malta’s New Gaming Act Setting Further Attractiveness

By Reuben Portanier

Published in iGaming Business Magazine Sept 2017 Edition

In 2004, Malta was the first EU country to regulate online gaming, and is regarded as Europe’s pioneer and veteran in online gaming regulation.  With almost 18 years under its belt, Malta has become Europe’s gaming capital with over 260 companies licensed from the Mediterranean island, employing almost 10,000 in the sector, and having the most comprehensive gaming eco-system in Europe based in Malta.  Despite its success, Malta is not resting on its laurels and it embarked on a process of further upscaling its regulatory framework, and as the MGA calls it ‘future proofing’.

The proposed new Gaming Act, sees some interesting regulatory innovations, whilst it will see the streamlining of its current multi-licensing classes to two main licenses – an umbrella B2C license and a B2B license.

Streamlined License Classes

The B2C license will allow operators to run casino, online lotteries, virtual games and secondary lotteries (grouped as Type 1 Games), fixed odds betting (as Type 2 Games), and betting exchanges, poker, and bingo (Grouped as Type 3 Games).  However, the most attractive part shall be that a B2C operator can hook in as many B2B platforms as they wish on their licensed B2C site without needing to obtain further licenses.  This will undoubtedly allow B2C operators to be flexible in their game offerings, whilst at the same time have a speedier time to market of games contracted from B2B operators.

The umbrella concept for the B2C license, will also open a plethora of opportunities for B2B operators, as the new framework will certainly create more business opportunities for them.

The new streamlined license classes will result a reduced regulatory burden, as compliance processes will also be streamlined as a result of just having one umbrella license.  For instance, a B2C operator will no longer have to undergo multiple compliance audits but will have to undergo one comprehensive audit covering all the game categories.

Regulatory Innovations

The new proposed game law, which is planned to come into force in the first Quarter of 2018, presents a number of novelties, which apart from be interesting, are also very topical.  Possibly the most bold regulatory innovation is that of having the new law ‘cryptocurrency ready’, insofar as one of the articles in the law could allow for such payments in the future due to the definition of “money and money’s worth” which includes “currency accepted as legal tender in the jurisdiction of its issue, virtual currencies, units of value, token of value, goods, services and any form of property which may be traded, sold, converted into or otherwise exchanged for money, goods or services”.  As the proposed new gaming law also includes ‘skill games with prize’, apart from the traditional games of chance, this could also open the doors further to embracing eSports, where in-gaming items could also possibly fall under the ‘money’s worth’ definition.

A challenging balancing act – allowing for start-ups and regulating the big guns

The new Gaming Act will also see different license fees and taxation, based on the type of license and the gaming activities on offer.  Having one singular B2C license, will see the license fee increase from €8,500 per license (under the existing multi-licensing structure) to a singular €25,000 per license.  The new license and tax fee structure may be more cost effective for those operators which today run multiple licenses, however, the new law also provides for a 6 month differential tax structure for start-ups, thus giving them some breathing space until they manage to find their feet.

The way ahead

The new Gaming Act has many more changes and innovations to those mentioned above, including principles that further strengthen player protection.  In a nutshell however, the proposed new gaming law would not only further strengthen Malta’s reputation and position from a regulatory point of view, but will also provide for a more business friendly environment for B2C and B2B operators and for game developers.  The proposed law, which was also subject to public consultation and to EU Commission scrutiny is planned to be in force by the first quarter for 2018.

Reuben Portanier is the former CEO of the MGA.  He is the founder of Avviza, a gaming advisory firm specialising in licensing, gaming compliance, and business advisory and is a partner with Afilexion Alliance, a corporate services advisory firm offering legal, accounting, company incorporation, M&A and intellectual property advice.

 

 

Schleswig-Holstein’s state parliament voted not to ratify the Interstate Treaty amendments

Schleswig-Holstein’s parliament voted not to ratify the Interstate Treaty amendments that were signed by all states in March 2017. Schleswig-Holstein wants the ban on online casino and poker games lifted.  This development shall create new legislative and political challenges in Germany, as the amendments to the Interstate Treaty agreed in March require ratification by all German states by the end of 2017, meaning that this development may effectively result in the new amendments not coming into force.

 

 

Visit us at the iGaming Supershow in Amsterdam

Avviza, as a founding member firm of Afilexion Alliance, will be present on the Afilexion Alliance stand, booth R13 at the iGaming Supershow which will be held between the 11th and 14th July in Amsterdam.  Afilexion’s co-founding partner, Dr Ian Gauci will be leading the team together with Mr Portanier.

Should you wish to meet us on our stand, you may visit us on stand R13, or send us an email at agtg@afilexion.com to set an appointment.

Reuben Portanier, shall be speaking at the iGaming Supershow in Amsterdam which will be held between the 11th and 14th July 2017.

Mr Portanier shall first be on the panel titled “Regulatory Update: Europe” as part of the Global Lottery Messenger Forum taking place on the 11th July.  In this session the panel will explore the current regulatory landscape for the alternative lottery market across Europe discussing what products are legal and how can these be marketed on a country by country basis.

Mr Portanier shall also be a panel speaker on the 13th July, during the IMGL Masterclass Seminar discussing the regulatory landscape in Europe. The panel discussion will be focusing in providing as update on the latest regulation and jurisprudence about AML, litigation and data protection. This session features an educational discussion where latest development in key legal areas for industry stakeholders are discussed by international legal and regulatory experts.

Avviza‘s Founder, Reuben Portanier, will be moderating a panel titled ‘Reinventing the Lotto Wheel’ during SiGMA 2017, which will be held in Malta between the 22nd and 25th November 2017.  As one of the leading gaming advisors on secondary lotteries (or betting on the outcome of lotteries), Reuben shall be moderating a panel including;  Angelo Dalli, CEO of Lotto Hero and Bit8, Robert Lenzhofer, Co-Founder Glück Games, and Michael Bogie, Director of Lottoland.

 

Malta based gaming advisory firm, Avviza, has been shortlisted for the prestigious eGaming Review (EGR) B2B Award in the “Corporate Services Provider” category

The EGR B2B Awards reward and celebrate the best service providers in the online gaming industry, with  Avviza joining industry giants which were shortlisted in 37 different categories.   

Malta is represented by two shortlisted firms in the corporate services providers category – one of which being Avviza.  Thus, being shortlisted for the EGR B2B Awards, does not only represent a prestigious recognition of Avviza’s position as one of the top gaming advisory firms in Malta, but also provides an important recognition of Avviza’s in-roads at a European level. 

On the announcement of being shortlisted for the EGR B2B Awards, Avviza’s Founder and CEO, Reuben Portanier, remarked, “it is a great honour for a relatively young advisory firm such as ours, to be nominated and shortlisted for the ‘Corporate Services Provider EGR B2B Award’.  Since inception, our strategy was that of providing our services across all European regulated markets – in some jurisdictions directly as Avviza, and in others, indirectly alongside our partners.  We had a remarkable twelve months on a European level, first by having been selected by the European Commission to deliver a matrix study on the technical requirements adopted by the 31 EEA States, and now having been nominated for this prestigious award.”

The EGR B2B Award winners will be announced on the 6th June 2017 in London.

EU Commission Study on Online Gaming Technical Requirements Delivered by Quinel and Avviza

 

In the second quarter of 2016, Quinel, an international certification and test lab, together with Avviza, an advisory firm specialized in the online gaming sector, were commissioned by the EU Commission’s DG for Internal Market, Industry, Entrepreneurship and SMEs to carry out a matrix study on the technical requirements for Online Gambling required in each of the EU and EEA member states.

 

The matrix study, being the first of its kind ever conducted by any institution or member state, presents a detailed and comprehensive dynamic matrix, which allows the EU Commission and the Member States to have a thorough view of the technical requirements demanded by each Member State for obtaining an online gambling license and keeping such operation in good standing.

 

Isacco Ceci, Chairman, Quinel

“This prestigious study was delivered and presented in Brussels last December to the EU Commission and to the national regulatory bodies within the EEA, and it is with great pride and satisfaction that Quinel could share its expertise and experience in the field of technical requirements with the EU Commission and 31 Regulators across the EEA”, said Quinel’s Chairman, Mr Isacco Ceci.

 

 

Reuben Portanier, Founder, Avviza

Reuben Portanier, founder of Avviza Advisory and Quinel’s supporting project partner added; “Carrying out a study of such a wide ranging magnitude in terms of technical requirements mandated across national legislations, regulations, directives and technical guidelines was no easy task, however our joint Quinel/Avviza team worked relentlessly over such a short period of time, and managed to produce a dynamic matrix study which is a first of its kind in this sector.”

 

 

With offices in Italy, Argentina and Malta, Quinel is one of the leading certification and testing gaming labs

internationally, whilst Avviza is one of the leading European boutique gaming advisory firms.

For further information, contact us on rp@avviza.com

Reuben Portanier speaks at MIGS2016

reuben-portanier-panelist-at-migs2016Avviza’s founder, Reuben Portanier, was one of the panelists at the Malta iGaming Seminar 2016, held at the Hilton Malta between the 7th and 9th November 2016.  Mr Portanier was a speaker on Day 2, on the panel discussing the future and relevance of eSports.  The panel adopted an interesting ‘fishbowl’ concept, whereby members of the audience had the possibility of placing their own views on the subject of eSports, with a panel seat hop-on hop-off concept.  Mr Portanier elaborated on the developing market parameters of eSports, touching upon the ways how eSports operators are raising capital for their business ideas and how the online gambling operators are being enticed by investing in eSports.  Moreover, Mr Portanier gave an elaborate overview of whether and what within eSports would be or could be regulated in the near future, by dissecting eSports into three categories; the first being the ‘traditional’ eSports digital skill games competition, the second being where eAthletes pay a registration fee to compete in the eSport and aim to win a prize, and the third being betting on eSports.  Mr Portanier described how the latter is a normal betting product which is licensable under existing online betting regulations, whilst the second may be a candidate for light touch regulation due to its nature of participating in a skill game with the possibility of winning a prize.

Avviza provides a whole suite of advisory services for eSports promoters and operators, including company incorporation, legal and regulatory advise, licensing, tax planning, business planning, consulting on how to raise capital and much more.  Should you want to learn more on how Avviza could be of assistance, send an email to rp@avviza.com

 

 

Avviza sponsors SiGMA 2016

sigmaAvviza, one of the leading gaming advisory practices, shall be sponsoring the Seminar of iGaming Malta (SiGMA), which is taking place between the 16th to 19th November at the Intercontinental Hotel, St. Julian’s Malta.  Avviza shall be present at SiGMA 2016, and thus, should you wish to meet our team, please send an email to rp@avviza.com or to nikita@avviza.com

 

Avviza Sponsors MIGS 2016

Avviza, one of the leading gaming advisory practices in the gaming sector has partnered with the Malta iGaming Seminar (MIGS) as one of the event’s sponsors.  MIGS 2016 will be held in Malta between the 7th and 9th November at the Hilton Malta.

avviza-migs“We are excited to be part of MIGS 2016 as one of the event’s sponsors.  MIGS is one of the leading gaming conferences in the gaming events circuit, which has grew year after year.  Thus we feel we have a certain affinity with MIGS given that we both are ambitious and we both strive to deliver the best service with the highest levels of professionalism”, commented Avviza’s founder, Reuben Portanier.

Mr Portanier shall also be participating as a speaker on the eSports panel on Day 2.

Should you wish to meet our team at MIGS2016, please send an email to rp@avviza.comor to nikita@avviza.com

 

 

Malta Notifies the EU Commission its Draft Regulations Titled ‘Skill Games Regulations 2016’

On the 10th August 2016, the Government of Malta notified its draft ‘Skill Games Regulations 2016’ through the EU TRIS procedure. These draft regulations shall establish a regulatory framework for Skill Games with Prize, with the Malta Gaming Authority (MGA) being the designated competent authority to regulate such games, thus empowering the MGA to issue licenses and supervise operators offering games of skill with prize in and from Malta.
Avviza - Skill Games AdvisoryThe draft regulations, which were initially drafted in late 2012, were over the past years amended so as to reflect the feedback received following a public consultation which took place in 2014-2015. The consultation paper published in December 2014 titled ‘Digital Games of Skill with Prize’, aimed at assessing the potential of embracing the ongoing convergence between certain skill games and games of chance and skill with prize, assessing how players of skill games with prize could have any reassurances of the operators’ supervision and at addressing concerns related to potential risks associated with the lack of specific regulation for this sector.

 
Licensing Skill Games with Prize
The draft regulations list the pre-requisites for applying for a Skill Games licenses, together with an array of licensing conditions which would allow Skill Games operators to hold a license. The key licensing features as presented in the draft regulations include:

  • The license will have a term of 5 years, which can be renewed for a further term
  • Licenses will be available to both B2C and B2B operators
  • There is no capping on the number of licenses issued by the Authority
  • Applicants need to complete all the application forms and due diligence forms
  • Ultimate Beneficial Owners holding 10% (or more) in the corporate body need to submit due diligence documentation and be subject to a fit and proper test
  • Only body corporates established in the EU or EEA are eligible to apply for a license
  • The applicant needs to appoint a Key Official who will be the main point of contact with the Authority
  • The applicant will need to produce technical, operational, financial and commercial documentation as part of its application
  • The license application fee shall be €2,330 (non refundable)
  • The annual license fee shall be €8,500 (paid in advance)
  • Player’s minimum age shall be 18 years.
  • The applicant shall present AML procedures and policies and conduct an Enhanced Due Diligence on players requesting cumulative withdrawals of €2,000
  • The applicant needs to prove to have opened a clients’ account with a Financial Institution, which funds need to be segregated from the operational bank accounts.

Taxation

Licensees of ‘Controlled Skill Games’ will be subject to the following gaming taxation parameters:

  • The rate of taxation due shall be five per centum (5%) of real income
  • Real income shall be construed as total wagers less total monies paid out to players
  • The tax due shall be paid to the Authority monthly, and by not later than the twentieth (20th) day of the following month.
  • The maximum tax payable annually by a single Controlled Skill Game Operator shall not exceed four hundred and sixty-six thousand euro (€466,000)

Determination of ‘Controlled Skill Game’

  • The criteria which the Authority shall take into consideration in determining whether a game is a Skill Game or a Controlled Skill Game include the following:
  • The presence of random draws and their effect on the outcome;
  • Whether the game is played for money and, or prizes with a monetary value;
  • Whether participation in a game involves any form of monetary commitment, or commitment of a monetary value;
  • The possibility of any negative social impact of the game;
  • Whether the activity is closely associated with games of chance and/or gambling;
  • The duration of each event, competition or match;
  • Whether, on the face of it, a skilled player is able to win more than an unskilled player;
  • Whether a player’s chance of winning is significantly increased by experience in playing the game;
  • Whether skill can be acquired through training, experience, reading literature or other educational material;
  • Whether a rule-set or format that is used further nullifies the effect of any element of chance;
  • Whether the game is played against other human players, or otherwise;
  • The level of interaction between the players, the level of interaction between the operator and the players, and the level of intervention by the operator during the event, competition or match; and
  • The complexity of the game, including the amount of player choices and their potential effect on the outcome, and the strategies involved.

The Authority, basing itself on any one or more of the above criteria, shall determine whether an activity is more akin to a game of chance or ‘a game of chance and skill’ rather than to a Skill Game as intended by the Lotteries and Other Games Act and any regulations made thereunder.

 

Technical Requirements

The draft regulations do not specify technical requirements, which presumably shall be issued in a separate directive.

 

Next Steps

The date when the draft regulations will come into force have not yet been communicated officially, however operators in this sector who would be seeking to be granted a license, should initiate the process of getting prepared in order to be amongst the first to be granted such a license.

If you wish further information, you may contact Reuben Portanier, Founder and CEO of Avviza Advisory on his email rp@avviza.com

Malta Publishes Fantasy Sports License Exemption Regulations – FAQs

Avviza - A right start to your businessThe Minister for Competitiveness and Digital, Maritime and Services Economy, has published Legal Notice 271 of 2016, entitled the Fantasy Sports (Exemption) Regulations (S.L. 438.10), exempting fantasy sports from the requirement of a gambling licence issued in terms of the Lotteries and Other Games Act (Chapter 438 of the Laws of Malta) or the Remote Gaming Regulations (S.L. 438.04).

What does this mean?

Through this exemption, Fantasy Sports operators will not require to hold a remote gambling license in order to offer its fantasy sport games to consumers.  However, this exemption shall be for a temporary period, as the Malta Gaming Authority (MGA) has determined that fantasy sports is predominantly a skill game and not a game of chance (or a game of chance with skill).  By classifying fantasy sport as a skill game, it de facto, (and now even legally by virtue of S.L. 438.10) means that fantasy sport does not fall under the regime of remote gaming.

Why is this an interim measure?

The MGA announced that it has notified to the European Commission a new set of laws and regulations that will specifically govern Skill Games (with Prize), and as a consequence, Fantasy Sports will fall under the regime of Skill Games (with Prize).  Therefore, as soon as the Skill Games (with Prize) regulations will be enacted, the interim exemption will no longer apply, thereby mandating that Fantasy Sport operators will then need to seek an authorisation under such a regime.

How long will the interim period last?

The temporary period, will last until the Maltese Government will receive a no objection from the European Commission (through the TRIS process) on its proposed skill games regulations and until such regulations are put into force.  The ‘stand still’ period on such regulations is subject to the TRIS notification period, which may last till the end November / December 2016.  In effect, during this temporary period and until the proposed regulatory framework for skill games is put into force, the Authority shall be open to receiving interests via ad hoc notifications, in order to closely monitor these operations and evaluate potential risks to the consumer.

How will Fantasy Sports operators work during the interim period?

In effect, during this temporary period and until the proposed regulatory framework for skill games is put into force, the Authority shall be open to receiving interests via ad hoc notifications, in order to closely monitor these operations and evaluate potential risks to the consumer.

How can AVVIZA assist Fantasy Sports Operators ?

AVVIZA can assist Fantasy Sports Operators both during the interim period, and in obtaining the necessary authorisation or license once the new Skill Games Regulations are enacted.  For more information you may contact us at rp@avviza.com or on +356 27 22 64 84.

 

 

The MGA Publishes Consultation Paper on Outsourcing in the Remote Gaming Sector

MGAThe Malta Gaming Authority (MGA) published a consultation paper for the purpose of obtaining feedback on an upcoming policy regarding the criticality of third party service suppliers to MGA licensees on the latter’s regulatory responsibilities.  The consultation paper was drafted following recommendations made by a specially appointed working group on the subject matter.  Through this public consultation paper, the MGA is seeking to obtain the reaction and suggestions from regulated entities and service providers by 1st August 2016, following which, an MGA policy on outsourcing will be published.  The consultation paper makes a distinction between outsourced services which are critical, and those which are not, thus seeking to only address those functions which may have a key impact on the compliance responsibilities of its licensees.  The non exhaustive list of critical outsourced functions include:

  1. Supply of critical elements of games or critical activities to the running of the gaming operation, including the RNG, risk management for matchbooks and the running of virtual environments enabling a multi-player environment for gaming;
  2. Management of system infrastructure:
    a) Capturing, storing, managing essential regulatory data (player records, gaming transaction records, financial transaction records);
    b) Provision of hosting of essential regulatory data and  critical game elements;
  3. Payment service providers
  4. Provision of intermediary services between the authorised person and the player, who perform functions, in part or in full, of regulated activities or parts thereof

The consultation paper recommends that each outsourcing agreement should be governed by a  Service Provider Agreement (SPA) which would include service level metrics. To download the consultation paper, click of the following link:  MGA Policy-on-Outsourcing-in-Remote-Gaming-Consultation

 

 

Amendments to Malta’s Remote Gaming Regulations sets new Return to Player Rate

 

MGAOn the 22nd of April 2016, the Remote Gaming Regulations (S.L. 438.04) were amended through the publication of Legal Notice 131 of 2016.

What do the amendments include?

The minimum average Return to Player has been set at 92% in virtue of Regulation 46A.  As a consequence, the Malta Gaming Authority published the Return to Player (RTP)  Directive (Directive 1 of 2016) which specifies the games for which the minimum average return to player obligation is applicable.  Moreover, the Directive also sets the methodology as to how the Authority will ensure that this RTP is complied with. The new regulation 49A requires licensees to make available to the players, information related to any fees charged to the players as well as the average winnings paid out to players over a period of time.  Click here to download Directive 1 of 2016.

 

Intergaming magazine features Avviza’s Founder in Malta Special Report

 

Avviza logo black on whiteLeading gaming magazine, Intergaming, featured an interview with Avviza’s founder, Reuben Portanier in its Malta Special Report published in March 2016.  The magazine, which features interviews with leading personalities in the online gaming industry introduces the interview with Mr Portanier as “Malta-based online gaming advisory Avviza Advisory, established by industry leader and former CEO of the MGA, Reuben Portanier in 2014, serves clients from all over Europe seeking gaming advice and licenses in various jurisdictions, including Malta.”   To read the full article, click here.

 

Dr Nikita Cuschieri LLD

Dr Nikita Cuschieri LL.D, LL.M Compliance & Legal Advisor

New Addition to Avviza’s Executive Team

Dr Nikita Cuschieri, joined Avviza’s executive team as a Compliance and Legal Advisor.  Dr Cuschieri shall be focusing on Avviza’s online gaming service line, whereby she will be providing regulatory and legal assistance to Avviza’s local and international clients.  Dr Cuschieri shall also be providing compliance advice to regulated clients, whilst she will also handle corporate services for Avviza’s clients.

Commenting on Dr Cuschieri’s addition to Avviza’s executive team, Reuben Portanier, Avviza’s Founder and Executive Advisor stated that,

“due to Avviza’s fast growth rate, we were looking for a person with varied experience in compliance, regulation, gaming and commercial law, and which could enhance our existing right-touch approach to our clients.  With Dr Cuschieri’s experience and skills in the fields of commercial law, maritime law and gaming law, we believe that we have strengthened our team for the benefits of our clients.”

 

 

Italy to assign 120 new online gaming and betting licenses in 2016.

Unlike jurisdictions such as Malta and the UK, which adopt an all year round possibility for operators to apply for an online gaming license, Italy has so far adopted a process of limited time windows when operators can apply to obtain a license in order to operate in the Italian market. Presently the license application time window is closed, however 2016 will see this window re-open for a limited period in July 2016.

Italian FlagThere are 120 new online gaming and betting licenses for grabs, and this will involve a tendering process with tendering rules being similar to the previous tendering processes. The general terms and conditions governing each of the new 120‘concessionaires’ will be identical to the ones imposed on the existing licensees, including the revised taxation rates which are set at 22% of Gross Gaming Revenue (GGR) for sports betting and 20% of GGR for fantasy sports and poker. Online bingo will also be taxed at 20%, however as from January 2017. The Italian Authorities set the license fee at € 200,000 per license.

Any operator may apply for a license, where the tender will allow any company incorporated within the EU/EEA to apply and subsequently hold an Italian license. The latter condition is worth noting as it eliminates the costs associated in incorporating an Italian company, whilst it allows for corporate profits to be taxed in the country of incorporation, thus placing Maltese registered companies in a very interesting position.

For any enquiries on the upcoming Italian licensing tender, send us an email to rp@avviza.com

 

 

MGA Issues Technical Guidelines On the Use of Cloud Based Hosting  for Remote Gaming

MGA

In December 2015, the Malta Gaming Authority (MGA) issued guidelines on the use of cloud based technology, with the purpose of underlining and updating the MGA’s approach when implementing its regulatory requirements and procedures with respect to Technical Infrastructure. The guidelines are intended to guide operators, other providers, and stakeholders on the Authority’s compliance objectives and what is taken into consideration when evaluating an applicant’s, or a licensee’s technical set-up.  The guidelines build upon the technical guidelines on the hosting requirements designed in 2011 which gave a clear scope of how an operator can host its operations in other EU jurisdictions.  The new guidelines have a wider scope, thus specifying how operators can host their operations exploiting cloud based technologies, albeit, on a private cloud model.  Click here for the full MGA guidelines.

 

 

EU Administrative Cooperation Agreement on Online Gaming

 

European_CommissionOn the 27th November 2015 EU/EEA regulators forming part of the European Commission’s Expert Group on Online Gaming in Europe, signed an administrative cooperation agreement which will eventually allow for the cross border sharing of information and best practices.  Discussions on this form of cross border cooperation initiated in 2012.  The cooperation agreement was also signed by the Malta Gaming Authority.

For further information, see below:

 

MGA Issues Enhanced Reporting Formats

MGA

 

On the 10th November 2015, the Malta Gaming Authority (MGA) announced in its 3rd Newsletter that it is implementing enhanced reporting formats for its remote gaming licensees. Although not all of the announced enhanced reporting measures will immediately be in place, the MGA stated that it is launching the first phase whereby it introduced a new reporting format for the submission of Monthly Tax and Players’ Liability Report and the issuance of a 6 monthly statistical information report for the purposes of the Authority’s Research initiatives on the sector.

The MGA stated that next stages of the enhanced reporting formats shall include the 6-monthly management accounting report and the submission of the yearly Financial Statements. The MGA also declared that in 2016, the Authority will be shifting to an electronic reporting system, whereby the licensees will be able to file the above mentioned reports electronically.

 

MFSA to change Personal Questionnaire as from December 2015 

business meetingIn October 2015, the Malta Financial Services Authority issued a circular announcing changes to the Personal Questionnaire Form which needs to be submitted by UBO’s, Board Members and Senior Management of regulated institutions.  The changes will involve further disclosure of information by the applicant to the MFSA, so as to allow the Authority to conduct more in-depth due diligence on the applicants.  To view the circular click here

 

Reuben Portanier included in ICE 2016 ‘Totally Gaming’ Conference speaker line-up

Reuben Portanier - Founder & Executive Advisor, AVVIZA
Reuben Portanier

ICE Totally Gaming 2016

Mr Reuben Portanier will once again form part of the ICE ‘Totally Gaming’ conference speaker line-up.

ICE is the largest and most important gaming conference and expo at a global level, and each year brings together the thinkers, the innovators and the originators from every gaming discipline.

ICE 2016 will once again be held at the Excel Centre in London between the 1st and 4th February 2016. Mr Portanier will be moderating the Regulatory Briefing within the ‘BetMarkets’ seminar, and will also be a speaker at the ‘Cybercrime, Security and Regulatory Compliance’ seminar.  Both will be held on the 3rd February 2016.

 

Netherlands announce gaming reform roadmap

In mid September 2015, the Dutch government announced a policy reform for games of chance in the Netherlands, which will see the Dutch government practically address all areas of gaming, including reforms for the Lotteries, Slots, Casinos and online gaming.  The road-map for the reform of games of chance was announced by the Dutch Ministry of Security andutch flagd Justice who stated that gaming reform shall be a core topic that will be addressed in 2016.  As part of the policy reform, the much expected implementation of the remote gaming bill should come into force in 2016.  In 2015, the Dutch Gaming Authority invited remote gaming operators to register their interest in obtaining a gaming license once the remote gaming bill would be enacted.  The expression of interested attracted approximately 100 submissions.

Latest Amendments to Malta’s Highly Qualified Persons (Income Tax) Rules 

In 2010, the Government of Malta introduced the ‘The Highly Qualified Persons (HQP) Rules’, for EU, EEA and Swiss expatriates working in Malta under an eligible contract of employment, and which are employed in certain named positions within licensed business activities falling under the Financial Services, Online Gaming or International Transportation (Aviation and Maritime) sectors.

business meetingThe HQP Rules allow expatriate employees in certain C-Level and highly technical positions to benefit from a 15% flat income tax rate, provided the yearly income is above €81,500.  This special 15% flat income tax rate was originally valid for a period of 5 years, however the Government of Malta has recently amended the rules to extend the applicability of the 15% tax rate for a further 5 years.  This amendment was published through Legal Notice 225 of 2015 of the Laws of Malta.

Expatriates from countries outside of the EU, the EEA or Switzerland can also qualify for the HQP, however different rules and obligations apply, such as the qualifying period for the applicability of the 15% flat income tax rate being for a period of 4 years. Avviza’s founder, Mr Reuben Portanier was one of the working group members which originally introduced the HQP.

Should you wish to learn more about Malta’s HQP rules, please send us an email to rp@avviza.com
 

UK Point of Consumption Tax Challenge Referred to the Court of Justice of the European Union

On the 14th July 2015, the UK High Court of Justice (Queen’s Bench Division, Administrative Court) handed down judgement on the controversial ‘UK Point of Consumption Tax (PoCT)’ which was introduced over six months ago, in line with the revised UK gaming regulatory regime.  The Gibraltar Betting and Gaming Association (GBGA) filed the challenge in front of the UK High Court of Justice on the basis that GBGA termed the PoCT as being a discriminatory measure against non UK based, legitimate online gaming operators.  The UK High Court of Justice ruled to refer the case in front of the European Union Court of Justice to obtain an opinion whether the PoCT is in line with EU legislation or not.

Commenting on the GBGA webiste, Peter Howitt, the CEO of the Gibraltar Betting and Gaming Association stated:

“This is an important decision for all industries and it is quite correct that it should be determined by the European Court rather than within the country that has created this unfair position. We maintain that the tax regime introduced by Her Majesty’s Government skews the market in favour of Domestic providers to the detriment of law abiding operators like our members, in clear breach of European law. Because of this sensible decision we now look forward to European judges considering this matter and believe they will confirm our position.”