Bill 55: Things Are Getting Messy in Malta
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Customer protection has been a hot topic in iGaming for quite a while. The majority of EU regulators are tightening the noose around operators' necks, imposing stricter and more elaborate rules and guidelines. However, one country tried to mix things up and protect the operators rather than the customers. Yes, Malta is acting like the bad girl of iGaming once again. This time, she might not get away with it.
Bill 55 or When Germany and Austria Joined Hands
Here’s the long story short. Back in 2021, the Austrian supreme court ruled that Pokerstars and other Flutter brands were operating illegally on Austrian territory. All contracts between Austrian players and Flutter brands were void. One person, represented by the Gottgeisl Leinsmer Weber law firm, went further, suing Flutter for losses and winning the case.
Needless to say, this started an avalanche of lawsuits among Austrian customers. Germans were fast to join the party. The first case opened Pandora’s box.
What was once a source of profit, now became a liability. Yikes! Now, Malta is frantically looking for ways to protect its own source of income: casino operators.
So, earlier this year, it proposed Bill 55. The proposed amendment to Malta's gaming laws aims to restrict Maltese courts from granting damages in such cases. This amendment would effectively shield gambling enterprises operating without local licenses.
German and Austrian politicians already warned Maltese peers they are paying close attention to the situation. At the same time, the Maltese government has found a reason to justify the move. It claims any local restrictions fall under the Freedom to Provide Services principle – one of the most essential ideas behind the EU. In other words, MGA brands have every right to offer their services anywhere in the EU.
Why is the Freedom to Provide Services so Important?
Obviously, Maltese politicians have an ace up their sleeve. The Freedom to Provide Services is one of the four fundamental freedoms in the Union, allowing members to freely offer their products and services across the Union. It helped shape the market we know today. However, things are more complicated than that, as the EU is not all about business.
What Malta forgot is that there is something called public interest. If a particular state believes it is in its best public interest to not allow certain businesses or to regulate them differently, it has every right to do so.
The best example of that is public healthcare. Let’s say an Austrian breaks a leg in Paris. They don’t have to limp all the way back to Vienna to get it fixed – the French will do that for them. However, it’s not like they can go and have their cholesterol checked while on vacation just because.
In my opinion, Bill 55 is not only about gambling. It is also about the sovereignty of each state member, customer protection rights, and yes, the aforementioned public interest.
Malta Could Ruin Its Reputation
Back in the early 2000s, the MGA license meant a lot more than it does today. Malta was one of the first to recognize the potential of iGaming and provide a, admittedly somewhat lacking, legal framework for companies. Over time, it has become a regulator that functions in favor of companies, rather than casino customers. Considering a gambling authority's main role should be to protect the user and keep operators under control, I would argue that MGA is slowly abandoning its purpose.
And I am not saying this only because of Bill 55. Bill 55 is just the tip of the iceberg. Over the years, Malta has been greylisted for questionable anti-money laundering practices. Then, it also tried to veto the Macolin Convention for as long as possible. The history of dubious choices, regulations, and moves is actually much longer than it might seem.
Where Is the Customer in All This?
I am a person who believes that, when all said and done, the people in Brussels forget all about their differences and grab a beer together. Politicians throw a spectacle and then pat each other on the backs. It is us, the regular folks, that end up in the mess that is left.
If Malta passes Bill 55 it will ruin its reputation among responsible casino players and those who expect a certain level of protection. In a way, the MGA license could turn into an essentially worthless piece of paper, similar to the licenses issued in Curaçao.
Sure, it will still be a license, but not a good one. It will become a novelty item, something to provide encouragement, although there is nothing behind it to support the customer.
Bill 55 is a bad PR move. Although it went unnoticed by the majority of gamers, and even iGaming insiders, it could be ground-breaking. Revolutionary, but not in a good way.
Good Luck, MGA!
I have nothing personal against Malta, Maltese authorities, or the government. But I hope Brussels will pressure it into ditching the idea of making gamers who seek compensation a liability. Two years ago, I wrote an opinion piece wondering whether the domination of MGA is coming to an end. Today, I am certain of it. It won’t happen tomorrow, by the end of the year, or maybe even for another three, but it will happen
As more and more companies focus on local licenses, due to high fines for those that operate without them, MGA is losing its power and allure. If and when players find out about this sneaky amendment, I hope they will show their opinion by choosing locally regulated brands. If that means getting a smaller bonus, so be it. At least you’ll have the law on your side.
This article delivers the thoughts and opinions of the author, and it doesn't represent the stance of GoodLuckMate.
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