The Commission has initiated infringement proceedings against a Maltese law that protects the online gambling industry from cross-border disputes. Malta supports its system for iGaming rules after the European Commission decided to start infringement action over Article 56A of the Gaming Act, once known as Bill 55. Officials say Article 56A restricts the upholding of some foreign court decisions against gaming businesses that have licenses from Malta.

The main problem is with legal cases filed by companies in Austria and Germany. These law firms claim that Malta-based gaming businesses are running their operations in those two countries without the proper rights. To make their cases, the firms join together claims about money people lost while gambling and file lawsuits against operators working under licenses from the Malta Gaming Authority (MGA).

Malta Defends iGaming Licensing Model as Compliant with EU Law

Malta answers that its licensing approach, called point-of-supply, means businesses follow the rules where the service comes from. Malta explains that this method fits EU law properly. After getting the Commission’s Letter of Formal Notice, the MGA explained that Article 56A does not give every Malta-licensed business protection against any European court orders or lawsuits. “Article 56A does not make it impossible to enforce European judgments on gaming companies from Malta, and it does not stop legal action against them in Europe,” the MGA said.

Malta also made it clear that the law follows existing EU laws, such as the order public part in the Brussels I Recast Regulation (EU 1215/2012). What Malta does is write its online gaming public policy directly into law. By working under EU law, Malta has always said its own iGaming rules meet the guidance from the Court of Justice of the European Union (CJEU). These rules also match the basic freedoms in the Treaty on the Functioning of the European Union (TFEU), which are the rights to offer services and set up businesses.

Malta Reaffirms Commitment to EU Principles in Defense of Online Gaming Law

The MGA stated that Malta creates its gaming policy by following these EU principles. Malta’s view is that any kind of stop, either obvious or hidden, on the right to offer services or set up other businesses in the EU goes against what the CJEU has said. This would block how companies enter different Member State markets and affect trade. If countries let these barriers continue, it will make the single market work less well. That would also limit how companies in Malta and all Member States give their services. For more than 20 years, Malta has always spoken out against any tough limits connected to online gaming that do not follow public policy.

The national government of Malta also said the same. They highlight that the law does not add new reasons to turn down any court decisions from another EU country. Instead, Malta uses the law to update its old public policy relating to online gaming. The government said it will send a full answer to the Commission within two months and will keep talking openly.