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MGA Gaming Act – Treatment of Intermediaries

MGA Gaming ActThe Malta Gaming Authority is arguably the most important regulatory body in online gambling today. This government institute offers the most sought-after licenses for casinos, so it pretty much speaks for itself that their news posts are being followed by casinos and seasoned gamblers alike. One of their latest news items was posted on the 26th of September 2018 and it seemed to attract quite a bit of attention. Because in this general notification, the MGA shared that the new Maltese Gaming Act would go into force. They are referring to Cap. 583 of the Laws of Malta and what they are specifically going into here is the treatment of intermediaries (or more specifically, what previously used to be called ‘intermediaries’) which is to be assessed in light of the Gaming Authorisations Regulations and the Gaming Authorisations and Compliance Directive.

What is this change all about?

Well now, this of course sounds like a lot of legal mumbo-jumbo, but we’ve tried to make sense of things a bit, so we will try to share this information with you in a way which might be a bit more understandable. Here’s what it comes down to: Article 28 of the directive that we just mentioned is all about intermediaries and that is the one thing that they really wanted to point out to the public. In other words, the MGA wanted to point out that people should be aware of this specific article. To start at the beginning, the term ‘intermediaries’ of course refers to someone who acts as a link between two parties to try to bring about an agreement. A middle-man, if you will. When it comes to online gambling, there are lots of different types of persons, websites and companies which may work from this position, but we’re not going to cover all of them. Because article 28 of the Gaming Authorisations and Compliance Directive (Directive 3 of 2018) covers specific types of intermediaries. It has four paragraphs and it clarifies the following:

  • i.  When an intermediary goes into contractual agreements with online casino players, they stop being an intermediary. So, they would need a license to do business with customers (B2C), while the casino would need a license to do business with that business (B2B).
  • ii.  The above is also the case when the intermediary takes care of the registration process, as well as the player deposits and withdrawals. However, there is an exception when this is just being done to facilitate the casino’s service.
  • iii.  If the intermediary only takes care of one of the functions from paragraph ii, the service may be classified as a material gaming supply, which is covered in article 27 of the same directive.
  • iv.  In case the intermediary doesn’t do any of the things mentioned in paragraphs I and ii, they don’t need approval from the MGA. The regulatory responsibility will then lie with the online casino, which needs to properly notify the MGA of the services provided and the related URL.

For more specific information about treatment of intermediaries under the new Gaming Act in Malta, simply visit the official website of the MGA. From there, they provide public access to the mentioned legislation, as well as a guidance note which is meant to further clarify the application of the directive that we just covered.

What does this mean for gamblers?

Information IconAs an online gambler, you obviously won’t need to worry about getting a license from the MGA. That means you definitely won’t notice anything from these legal changes. But the Malta Gaming Authority did announce that certain persons, websites and companies may need to apply for different licenses. By giving them this requirement, it will be easier for them to keep an eye on the parties that are doing business directly with online casino players. Therefore, you can rest assured that your rights are protected by the authorities. And we can all agree that that is a good thing!