Lotteries and Gaming Authority

Transcription

1 Lotteries and Gaming Authority

2 Remote Gaming was introduced in Malta under the Department of Public Lotto Act in 2000 Regulations for Offshore Betting Offices Only betting was licensed 0.5% Gaming Tax Incentive These regulations attracted more than 60 companies between 2000 and 2004 In this period 42 operated successfully

3 DPL Act was replaced by the Lotteries and Other Games Act in 2002 Offshore Betting was hit by the 0% betting tax in the UK - 16 operators closed down their offices in Malta The Regulations did not reflect the needs of a changing market Popularity of betting was being taken over by other forms of gaming that was prohibited by the Regulations

4 Were started in early 2003 Presented as draft to the Public by the end of Summer Authority held a Public Consultation Meeting on the New Regulations on the 8 th of November Feedback was clear and aggressive New Regulations were still not up to the market needs Authority understood it required a proper structure besides regulations Then things started to happen fast!

5 Until February 2004 the Authority employed one person and had three other hired from DPL It operated from the DPL offices. In February 2004 Authority acquired new office for it to house all its operations and Recruited the Chief Executive and Legal Director To recruit the remaining staff To revise the Remote Gaming Regulations and publish them To market Malta as a reputable jurisdiction with a strong, dynamic regulation and a good understanding of the industry. Target 40 remote gaming operators by end f 2005 To articulate all of the Gambling Legislation

6 Today the Authority has a staff compliment of 26 people New staff has a background in different areas of gaming. Operating from our new offices in ta Xbiex Five officers are directly involved in Remote Gaming and 8 others support them in the following functions: Application Processing Involvement Verification Regulatory Supervision Financial & Accounting Information Management Inspection Marketing

7 The Board Dr. Joseph Zammit Maempel Chairman Chief Executive Officer Mario Galea Legal and Enforcement Director Dr Anthony Axisa Inspectorate Chief Inspector Bernard Storace Corporate Service Human Resources Rita Calleja Remote Gaming Sandra Gatt Kenneth Bonello Casinos Philipe Warzee Lotteries Stephen Vella Personal Check Philip Agius Denitza Dimitrova Deputy Chief Inspector Bernard Zarb Remote Gaming Insp. Melody Morgan-Busher Inspectors (9) Accounts Marvic Battistino Administrators Mariella Maurin Frances Blenheim Anthony Borg Information Analysis Unit Kristy Spiteri

8 Remote Gaming Regulations came into force on the 20 th of April 2004 Established under the main Act as Other Games by Means of Distance Communication This means that: the gaming principles are the same as those of the principal act that requires parliament intervention to change, the regulations were under the control of the Authority and can be changed by way of a simple legal notice The Offshore Betting offices regulations were repealed

9 ! Technology Neutral Apply to all types of technologies: Internet, Mobile, Telephone, Fax and Game Devices Game Neutral Apply to all types of games: Betting, P2P, Online Casino, Community Games, Leagues, etc. Future Proof (as much as practicable) Shift from regulating the games to regulating the means of carrying out gaming Establishes a safe environment for players Giving operators a competitive edge

10 Qualifying criteria for Applicants: A Limited Liability company registered in Malta; Applicants shall be fit and proper; Must demonstrate a business and technical ability to carry out the operation; Must demonstrate that the operation is covered by sufficient reserves or securities to ensure player winnings and deposit returns. The regulation does not call for a bank guarantee unless the Authority foresee that players money is at risk

11 "## Establish the License Criteria and licensing Procedure Requirement of a responsible official Defines the Remote Gaming System Model Certification Player Safety Prevention of Money Laundering Classifies the Types of Games Establishes Gaming Tax

12 $" Supervises all the operations Is responsible for all functions of the operation (Game Risk and IT Security Risk Management) unless vested in other persons registered with the Authority Ensures that the licensee complies with all applicable laws Must be: A director of the company Resident in Malta (i.e. files the tax return here) Position may be outsourced as long as all responsibilities are fulfilled

13 A system of internal controls, administrative and accounting procedures for the conduct of a remote gaming office Technically this includes all the subcomponents of the system where the player is in the secure area, login module included The control system must be located in Malta The RNG is part of the control system The applicant is required to submit a written document outlining the control system functionality and specifications for the approval by the Authority and update it if there are changes A licensee is granted after control system has been issued a compliance certificate

14 A system by means of which remote gaming is conducted, and shall include all its associated components, its operating systems and application software Technically this includes all the subcomponents of the system which provide the games, including gaming devices where applicable Gaming system must be also be certified for compliance Requires further approval if critical components of the system are subsequently changed

15 USER FRONT-END GAME APPLICATION OPERATING SYSTEM GAMING DEVICE WEB-BASED, JAVA, FLASH PC, idtv, Mobile, VLT, Xbox, PlayStation Communications Channel Internet, SMS, TV Broadcast, GPRS, 3G. Must be Located in Malta GAMING SYSTEM CONTROL SYSTEM HOMEPAGE WEBSITE ODDS EVENTS GAMES PAYMENT GATEWAY Player Accounts Game History Transactions History Gaming Platform CLASS 4 Licensee

16 Who can carry out Certification When certification is to be carried out Requirements for certification: Server protocols, communication protocols and other specifications which are part of the gaming system architecture; Gaming Risk Management Procedures IT security Risk Management Procedures and internal controls of the system; Modules that affect processes, rules and parameters of the game if the sourcecode is changed; Detailed description of the setup and functionality of the application architecture and system architecture

17 Class 1: For operators who partake in unlimited risk on games depending on repetitive occurrences Class 2: For operators who manage their risk on a singular event Fixed Odds betting, pool betting and spread betting Class 3: For operators who promotion or abetting gaming from Malta Operators who are receiving only a commission fall under this class Class 4: Hosting and managing other remote gaming operators, other then themselves Platform operators or software vendors

18 Since April 2004 the LGA has received 53 applications Granted 45 and 8 still pending Currently the industry employs 230 people Class 1: Class 1 on Class 4: Class 2: Class 3: Class 4:

19 !! %# United Kingdom 9% Belgium 2% Spain 2% Holland 4% Switzerland 2% Sweden 19% Austria 19% Ireland 2% Portugal 2% Canada 2% Germany 13% USA 2% France 4% Italy 14% Norway 4%

20 ! Betting Exchanes 8% Poker Rooms 6% Casino Games 14% Lotteries 6% Bingo 3% Betting 63%

21 !! Positioning Malta as the European Hub of IGaming Published in collaboration with local service providers and licensed operators copies distributed with igaming Business Magazine, EIG and ICE 2005 Currently working on the 2005 issue which will include a directory of services and platform operators

22 Authority has issued an approval to three entities to carry out certification Hired its internal Remote Gaming Inspector In February 2005 published its own Compliance Audit Guidelines: Based on the ISO/IEC Standard and the FATF 40 Recommendations Centred around the regulatory requirements of the Remote Gaming Regulations Covers Gaming Risk Management Procedures and IT Security Risk Management Procedures Already tested successfully on two companies and an ISP

23 $ & Kite marks for every Class and Software Platform Seal of Approval A point of differentiation for licensees operating from Malta In future to serve as a link to the Certificate website of the Authority.

24 ' ( Our weakest point in the remote gaming industry has been Internet Bandwidth when compared to other jurisdictions: Quality unstable latency times and low guaranteed uptime Quantity Until 2003 Malta had only 155Mbits Reliability Until 2004 there was one international Carrier Vulnerable open to DDOS attacks Cost Average bandwidth price was 10 times higher that of EU

25 LONDON INTERNET EXCHANGE BEGLIAN INTERNET EXCHANGE Average Latency Times From Malta To London Internet Exchange: 52ms To Frankfurt Internet Exchange: 38ms MILANO INTERNET EXCHANGE CABLE & WIRELESS TELECOM ITALIA MAE MIAMI TELECOM ITALIA vodafone PALERMO

26 ) Currently is the largest carrier for Internet Bandwidth Cable capacity is 16STM1 (2.15Gbps) with current usage at 600Mbits New agreement with Telecom Italia has improved peer to peer latency times and guaranteed uptimes In February 2005 installed DDOS equipment in Palermo Has a backup microwave link with Sicily

27 # Started operating in September 2004 Connected to two carriers Cable & Wireless and Belgacom Cable capacity is 16STM1 (2.15Gbps) with current usage at 155Mbits Is positioned to sell bandwidth at B2B level Controls traffic flow upstream to mitigate DDOS but is currently looking at installing other solutions that eliminate risks

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