Malta sends Brussels its proposed regulations on skill games

The Maltese government has sent to the European Commission its proposed regulations on skill games.

This has opened what is known as the stand still, a period of three months during which Member States or even the Commission itself can express their opinions, without being tied down by them.

The games which are thus being regularised are games where one competes for a money prize, which are offered over the means of communication at a distance and whose outcome is determined only by means of the skills of the player or mostly by means of the skills of the player. Sports events are excluded.

The proposal authorises the Malta Gaming Authority to issue directives to regulate the skill games so as to protect the consumers.

The authority can also create new sub-sectors such as ‘controlled skill games’ when it feels that the games require more regulations and such games may be subject to further rules by the authority such as being subject to a licence, have regulatory vigilance and pay taxes.

The proposed regulations include details how a licence can be issued, how long will a licence be valid, what checks can be done by the authority, the duties of the holders of the licence, including those regarding precautions against money laundering and safeguarding the funds of the players, the authority’s right to supervise and how an appeal can be made.

The proposed rules aim to give the Malta Gaming Authority the task of supervising and regulating skills games through authorising the same Authority to publish the standards to reach the desired level in the public interest to ensure the rules’ correct functioning, their transparency, protection from crime, and checks aimed at safeguarding the rights and interests of consumers, including minors and other vulnerable persons.

The Lotteries and other Games Act (Chapter 438 of the Laws of Malta) defines skills games and explains that the minister can issue regulations for skills games so as to enable their operations.

This has been rendered necessary by the way in which the games industry has developed, with an increasing convergence between skills games and games of hazard. Malta believes that some games already available on the market may need more checks and controls because of the nature of the games as otherwise, not being games of hazard they may be a risk to the consumer.

The risks that have been identified include the correctness of digital games, how a participant pays to participate, how rewards are promised, how funds belonging to the players are held, and the possibility of money laundering and of other criminal activities.

It will only be through an examination of each particular case that more checks may be found to be necessary in the public interest and so that the regulation be justified, proportionate and necessary.

The Authority will not have one model and one type of regulation applicable to every game but must vary this according to the nature of the game in question.