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Home News & Events i-GAMING LAW NEWS: Malta, Largest in Online Gaming Industry, EU Green Paper Shows

i-GAMING LAW NEWS: Malta, Largest in Online Gaming Industry, EU Green Paper Shows

Monday, 28 March 2011 23:37

There are currently estimated to be about 15,000 online gambling websites across the European Union with annual revenues in excess of €6bn, or 7.5% of the overall market share, according to the latest available figures.

With the on-going development of technology by means of which people can easily interact with online games, the channels currently used to access online gaming sites are the Internet, mobile applications and Internet Protocol Television. In this respect, the sector is proving to be more difficult to monitor and consequently, to police.

 

This is one of the driving forces behind the Green Paper launched by the European Union on March 24, 2011, aiming to gauge a comprehensive understanding of the online gambling market which is rapidly expanding beyond original expectations. Internal Market and Services Commissioner Michel Barnier is quoted to have emphasised that “the online gambling market in the EU continues to grow rapidly and generates important revenues that are sometimes channelled into good causes. Its expansion must go hand in hand with a determination to protect our citizens, especially minors, and to ensure that offers of these types of services within the EU are sound and well-regulated.

 

With the launching of the EU Green Paper, Malta has been placed in the spotlight since despite being the smallest EU Member State, it enjoys the largest register of online gaming companies and this is all due to its favourable taxation regime.

For example, it is pertinent to point out that in 2008 online Gross Gaming Revenue (GGR) was deemed to be at 0,68% of the Gross Domestic Product (GDP) of the EU. In Malta, which has indeed become a i-gaming hub, the GGR represented 7,82% of its GDP. This is followed by Latvia (1,38%), Greece (1,30%) and Cyprus (1,22%).

According to the European Commission the Green Paper will be a “genuinely open” consultation with “no preconceived outcomes” emphasising that the main objective behind the EU Green Paper is to acquire a comprehensive understanding based on facts of the prevailing situation in the EU online gaming market and of the various national regulatory models which are currently in place.

However, many fear that this may be the first step towards the harmonisation of rules on the online gaming phenomenon across the European Union.The large majority of Member States want specific and harmonised regulation. Naturally, Malta is  in disagreement with the stance taken by these Member States since it prefers a liberal approach where the common EU internal market rules on cross-border services prevail. “The primary aim of the Green Paper consultation is therefore to obtain a facts-based picture of the existing situation in the EU online gambling market and of the different national regulatory models,” the Green Paper states.

The consultation process about the Green Paper will continue until the end of July.

[Author : Dr Sarah J. Scicluna]

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