The Malta Gaming Authority (MGA) is an online gaming regulator that provides operating licenses to iGaming businesses. Since iGaming sites can’t legally operate in most countries and regions without the proper licenses, the MGA and regulators like it play an integral role in the smooth running of Internet gambling sites.
A quick glance through the sites listed in the casino guide from
newcasinos.com shows just how many online casino brands rely on the MGA for licensing. It is one of the most prominent and influential regulatory bodies in the iGaming world.
All of this means that whenever the MGA announces an update to its policies and procedures, it’s big news in the iGaming industry. Even gaming brands that are licensed by other regulators pay attention to these announcements because they could be a sign of wider changes to come across the industry as a whole.
This article will break down what the Malta Gaming Authority does, how the typical audit process works, and everything you need to know about the latest updates and changes to how it functions.
History of the Malta Gaming Authority
The first question most people have when it comes to the importance of the Malta Gaming Authority is simple, “How? How did this tiny island country with a population of just over 500,000 become such a global powerhouse in a new industry?” Unlike Monaco, Malta doesn’t have a long history of traditional land-based casino gambling, so the answer isn’t just “A simple evolution from the concrete to the digital.”
What Malta does have a long history of is embracing new industries and international cooperation. This has made it a hub for industries like shipping and banking, both of which have seen huge changes in the digital age. The country’s position in the Mediterranean, membership in the European Union, and historic relationship with Britain have all worked to its advantage.
In 2004, Malta became one of the first countries to regulate online gaming and took its first steps towards becoming the regulatory powerhouse that it is today. Since then, it has continued to implement policies that make the country an attractive destination for iGaming brands and their affiliates.
Today,
Malta is home to a huge number of iGaming brands, game studios, platform providers, and payment service companies. This has had a positive impact on the Maltese economy, which has in turn, encouraged the Government to implement supportive policies and maintain its position as a leading regulator.
There have been some concerns raised about the Government being too closely involved with the gambling industry and the money that it brings in. This will always be a concern whenever gambling is involved, due to its very nature.
The more serious concern for Malta is that the regulation of online casinos by individual countries will lead to each country having its own regulatory body, leaving the MGA obsolete. This is unlikely to happen any time soon, but it is something that the MGA will have to consider.
Gaming Regulators
The next question is what exactly are gaming regulators and what do they do? Gaming regulators are the governmental bodies that work to keep gambling transparent, fair, and safe for players. These regulators are an essential part of the iGaming ecosystem.
Some gaming regulators only cover a limited area.
In New Jersey, for example, online casinos are regulated and licensed by the New Jersey Division of Gaming Enforcement. Meanwhile, its neighbors are regulated by the
Pennsylvania Gaming Control Board. In fact, each state has its own regulator and licensing body for land-based and online gambling.
Other gaming regulators have an international area where they are accepted. This is because they cover iGaming sites that operate in countries that don’t have their own regulatory bodies or don’t have a system for granting licenses. Not every regulator has the same standards. Some of these international regulators are much less strict than others, which can result in unsafe iGaming sites.
The most trusted international regulators are the Malta Gaming Authority, the UK Gambling Commission, the Gibraltar Regulator Authority, and the Curaçao Gaming Control Board. Licenses from these regulators are accepted nearly everywhere.
Gaming regulators set out the rules for how all types of gambling can be operated. This includes casinos, sportsbooks, lotteries, bingo, scratch cards, etc. These regulations can include everything from hours that physical casinos can operate and how iGaming businesses advertise to setting the rules casino games must follow, required security measures, taxes and employee rules, and more.
Regulators are also often responsible for granting licenses to gaming businesses that want to operate in their region. Big international regulators like the MGA or the UK Gambling Commission provide licenses that are accepted in countries that don’t have their own licensing system yet.
What is an Audit?
Just like every other government agency that requires specialized knowledge to make informed decisions, regulators work with outside experts. Gaming regulators work with private auditors. These auditors examine and test every aspect of the gaming site to make sure it is following the rules set by the regulators.
Typically, an auditor will investigate a company before it is granted a license to make sure that it meets the required standards. Just like with the IRS, however, auditors can also be called in to reexamine a gaming site if the regulator begins to receive a lot of complaints about it or if other red flags are raised.
Auditors test the security systems the site has in place, the payment system, how the platform functions, how live dealer games function, and other elements of site functionality that relate to the regulations. When it comes to the games, auditors test for functionality and fairness. They make sure that the stated return to player (RTP) rate is accurate and that the random number generator software is truly random.
Between the regulatory bodies and the auditors, players can be sure that the sites they access are fair and safe.
Changes to the Malta Gaming Authority’s Audit Process
With all that information laid out, we can finally talk about the topic of this article—the recent changes to the Malta Gaming Authority’s audit process. In May, the MGA announced changes to the audit process and the audit portal on its site. These changes were made to strengthen the process and streamline how audits are reported.
Under the new rules, an auditor has 60 days to complete system audits and 90 days to complete compliance audits. These may then be submitted electronically. If the auditor discovers non-compliance during the audit, they must notify the license holder and give them the opportunity to fix the issue during the period of the audit.
If the problem is fixed, the auditor can mark it as resolved when submitting their report. If it is not, the license holder can request extra time to fix it. If it still isn’t fixed when the audit report is submitted, the report can be classed as Partially Compliant.
Once the audit is submitted, the MGA can then evaluate the site and determine whether or not their license will be renewed. These changes add transparency to the process and make it more efficient for every party involved.
By Chris Bates
