Malta Decision Protects the Rights of Offshore Operators
Published June 30, 2023 by Lee R
The rights of offshore operators are gaining new life in Malta.
In Malta, an unorthodox law addressing offshore operator protections has been approved.
Impact
Let’s take a closer look at the law and the ramifications for the iGaming industry overall.
The Bill
Maltese lawmakers have approved Bill 55, a bill designed to protect offshore operators based in Malta from foreign liability.
Protections
On the surface, this sounds like a move to protect Malta operators who attempt to serve other jurisdictions from being fined or penalised by the jurisdictions they try to serve.
Goal
The law is indeed a measure to protect said Malta-based foreign operators through the infrastructure of the Malta legal system.
Enforcement
Signed into law June 16, 2023 by Malta President George Vella, Gaming Amendment Act No. XXI of 2023 orders Malta courts to refuse to recognise or enforce foreign judgements against Malta-licensed operators “active in the European market.”
Exempt from Penalties
In other words, operators licensed in or by the Maltese authority will be exempt from enforcement of penalties they incur when attempting to serve other European jurisdictions. This is in effect a refusal by the jurisdiction of Malta to honor penalties imposed against companies they have licensed which try to serve other jurisdictions.
Malta Historical Position
Since Malta is one of the pioneers of iGaming, it has remained a hotbed for new provider and operator licenses.
Recent Precedent in iGaming
Many new operators from Malta have attempted to branch out into nearby European jurisdictions via offshore activity, a practice which has been reduced in direct proportion to the number of European nations legislating their own iGaming licensing systems.
Basis for Offshore Offerings
The offering of services to other countries by Malta-licensed companies practice accepted through what is known as the European single market--in keeping with the
Treaty of the Functioning of the European Union that provides for the “free movement of services across Europe.”
Basis for EU Penalties
EU enforcement against offshore operators serving jurisdictions they are not licensed in traces back to the EU Commission’s 2017 decision to close infringement procedures and complaints in the gambling sector.
New Movement
A plethora of cases concentrated in Germany and Austria show that the rights of offshore operators to serve jurisdictions they are not licensed in is gathering momentum, with many operators penalised for serving other jurisdictions companies seeking out lawyers in Malta to protect their rights.
Outlook
The basis for protection of the rights of offshore operators has clearly gained traction in Malta, representing a reversal trend of acceptance of offshore offerings as violations in an industry which has become accustomed to penalising offshore operators in recent years.
