Malta is an advantageous jurisdiction for those who want to establish forex, crypto, and gaming services.

These three services have particular licenses. Forex companies follow the same licenses that investment services, and crypto and remote gaming have a four-class licensing system.

Malta is a service-oriented economy. While so many countries are seeing services such as forex, e-gaming, and cryptocurrencies with dismay, Malta is offering them an opportunity to thrive with a beneficial tax system, a strong regulatory frame, and allowing them to settle in a secure jurisdiction.

Malta was the first EU member to regulate the e-gaming industry and the first in the world to regulate the cryptocurrency investment industry. It’s been a frontrunner in innovative financial services and licenses to attract new investors to the country, and it has worked.

Today, the country is home to dozens of investors in those industries and has become a hub and a safe haven for the crypto world, e-gaming, and legit forex investors.

Some EU countries look at this type of businesses as second-class businesses and try to suppress them with the excuse that they promote money laundering. This is a complete lie.

E-Gaming, FOREX, and crypto are legit businesses that are attracting reputable investors and can offer significant gains for those willing to take the chance. Malta knows this and that’s why it has become a harbor for the investors in these areas, offering them a safe jurisdiction with impressive services and possibilities for them.

Why should Malta be at the top of your list?

Reason 1: The regulators, the Malta Gaming Authority, and the Malta Financial Services Authority embrace new business models and have a good reputation.

Reason 2: Malta is one of the most advanced and respected Forex, gaming, and crypto jurisdiction.

Reason 3: Skilled and English-speaking workforce

Reason 4: Low taxes in an onshore, whitelisted jurisdiction

Reason 5: Presence of B2B and B2C companies, which gives you immediate access to top IT, tax, accounting, headhunting, AML, auditing providers.

E-Gaming

Malta offers a flexible and complete regulatory framework with an excellent fiscal regime for license holders. This has led over 350 licensed gaming companies to settle in the country, including some of the top players in the world. Some are using Malta as their main headquarters and others as support and call centers with hundreds of employees.

One of the main benefits of Malta’s e-gaming frame is that any person licensed by another EEA member state or any other jurisdiction approved by Maltese authorities can manage remote gaming activities in Malta and from Malta freely without further licensing.

Remote gaming has four particular licenses depending on the activities the person intends to carry out.

These are the four classes:

1. Operators that conduct gaming risks on activities grounded on repetitive events, such as lotteries, arcade games, and bingo.
2. Operators that conduct gaming risk based on singular events (betting), such as sports bets.
3. Operators that promote games and get a commission in peer-to-peer transactions, such as poker rooms.
4. Operators that run platforms to host services of any of the classes mentioned above. They are not directly involved in managing players, but others provide a host so other licensees can run their games on.

The process to get the license can be divided into five main parts:

Pre-application: Here, the potential licensee should set up a meeting with the Lotteries and Gaming Authority of Malta (LGA) to discuss the project and see its feasibility.

Fit and proper test: When the process begins, the LGA will evaluate the candidate to see if it’s fit and proper to carry on with the business and get a license. They will evaluate the individual’s expertise, experience, and financial record. The following documents must be submitted:

• Declaration form of every director and individual with at least 5 % of the shares or voting rights

• If at least one party of the application is a company, the ownership and incorporation entities must be submitted.

• Birth certificate copy

• Passport-sized photo

• Conduct certificate

• Statement of affairs

• Banking references

• Bookmaker license in another country (if applicable)

Business planning: The interested person must submit a business plan that should contain:

• The objectives
• The company structure
• The nature of the games the operation will offer
• The technologies to be used
• A summary of the software to be used
• A three-year business plan that contains:
  1. Marketing and sales
  2. Balance sheet

• Sources of finance

Operational requirements: After the pre-approval part, the applicant will submit a series of documents that summarize the details of the business and technical characteristics of the company and its operation. This part is generally the most bothersome as the memoranda should be as all-encompassing and specific as possible. This list is not extensive, but some of the documents that will be required are:

• Maltese company registration and articles of association;
• Information security policy, incident response policy, and user management policy;
• Financial bookkeeping, data backup, change management, and fraud supervision procedures;

Audit: After the documents have been submitted, the LGA may give you a series of recommendations for your business and will require you to accept a technical and system audit before you officially start operating.

Fees

1. Application fee: €2,330 (non-refundable);
2. License fee: When the fee has been approved, you must pay a yearly €8,500. Your license will be granted for a five-year (renewable) period;
3. Renewal fee: When the five-year period expires, you must pay an additional €1,500 fee.

What about taxes?

Most remote gaming companies qualify for the 6/7ths refund, which means their corporate tax rate is generally 5 %. However, there’s also a gaming tax. The amount depends on the license class.

For class 1: €4660 per month for the first six months, and €7000 per month afterwards.

For class 2: 0.5 % on the gross amount of taken stakes

For class 3: 5 % of the net income of the company

For class 4: This one is a bit more complex. The company pays no taxes for the first six months, then it pays €2,3300 per month for the next six months, and €4,660 per months from then until the license expires.

The top annual amount of gaming tax payment is €466,000 for all licenses.

FOREX companies

Now, regarding forex companies, they require a Category 3 investment license (look up at the funds section where we’ve explained all investment licenses). In principle, forex is limited to currency trading, however, a company that holds such a license can deal in financial instruments on their own account and provide all kinds of investments covered by the license. Thus, the license would help a forex company to expand its operations to other services.

However, it is vital to note a Forex license may not have passporting rights to other EU states. Nevertheless, in the countries that the provision of forex includes the use of financial instruments, as it is in Malta, then the passporting rights may apply.

The application process has three steps:

1. Preparation: The potential applicant should set up a meeting with the MFSA to explain the project and offer a full description of the activity before the meeting to explain all the details of the proposal. Afterwards, the potential applicant should deliver a draft application form with the necessary documentation to the MFSA, which will decide on the particular classification of the license.
2. Once the MFSA has reviewed the draft application, it will issue an in principle approval, which means the license is approved with the condition that the applicant incorporates the company and submits the final copies of the revised application form with any other necessary supporting documents. After these issues has been settled, the license will be issued
3. After the license is issued, the applicant may be asked to comply with some post-licensing requisites.

Fees

• Application fee: €2,000
• Issuance fee: €4,000
• Annual supervisory fee: €4,000 for income up to €250,000, and €350 per each additional €250,000 up to €5m

Now, what about taxes? As with e-gaming companies, shareholders can apply for the 6/7ths refund.

Last but not least, let’s discuss cryptocurrency licenses.

Cryptocurrency license

Crypto companies can provide eight services under the Maltese law:

1. Receiving and transmitting orders;
2. Execution of orders representing other persons;
3. Dealing on their own account;
4. Portfolio management;
5. Custodian/Nominee Services;
6. Investment consulting;
7. Inserting Virtual Financial Assets (VFAs);
8. Operating a VFA Exchange

There are four types of crypto licenses.

Here’s everything you need to know about them:

What can we do for you?

Thanks to our top experts in Malta, we can become a one-stop-shop for your licensing process. We can help you:

• Set up a corporate structure
• Compliance services
• Open a bank account
• Assistance, preparation, and submission of a license application with the MGA or the MFSA
• Taxation and accounting consultancy
• Auditing services

Do you want to know more about the incredible financial services we can offer through our experts in Malta? Contact us now! 

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