Golden goose needs careful nurturing
The international press, especially the Italian one, has been filled these past days with stories of ‘Ndrangheta criminals who have been arrested in Italy and who seem to have links with online gaming companies in Malta which they may have been using for money laundering.
This is bad news for Malta as obviously the Italian press has lost no time in highlighting Malta’s name in the matter and implying that Malta’s online gaming industry is a front for money laundering.
The Malta Gaming Authority has meanwhile suspended the incriminated websites but the damage may have been done.
It is a fact that most of the recent growth in the national economy has been due to the high increase in online gaming companies that are registered in Malta. Some, nay many, are serious and world-renowned. They have found available location in Malta, with an English-speaking population, ease of access, business-friendly regulation and very good Internet access.
These companies have provided many Maltese with very good salary packets and they have also attracted to our shores many foreigners from all sorts of countries who have been well-integrated into the Maltese style of living.
Above all, the online gaming sector has substantially contributed to the economy, not just through employment and spending power but also through the taxes these companies pay.
But the sector in itself is a fragile sector which is easily scared off. In fact, many of the companies now here have had a prior existence elsewhere and relocated here once they found a better location.
Countries in and out of the EU have tried to tackle their relocation to Malta either by blocking or trying to block internet access to viewers in their countries.
Malta is at present fighting a rear-action against a proposal by the Council of Europe to introduce a regulation that could bring down all sports betting conducted from Malta. The final word on this threat hanging over us is not over.
All this carries with it a sort of deja-vu. Prior to Malta accessing the EU, much the same campaign, maybe by the same countries, used to be waged with regards to Malta financial services sector. At that time, with EU accession still not sealed, Malta was accused of being a rogue country with people with a shady background making it their quarter. Then Malta, wisely, switched from an offshore jurisdiction to an onshore one and finally, after huge efforts, made it to what is known as the White List of jurisdictions.
It is true that even here one could find some rare cases where shady deals seem to have been made and where Malta’s name was besmirched. Nevertheless, the vast majority of companies registered in Malta have proved to be serious and law-abiding and using Malta for its other advantages and certainly not for tax evasion.
One would wish to be able to say the same about the online gaming sector but maybe, just maybe in view of the recent events, there was not enough checking done prior to their being allowed to operate out of Malta.
The Malta Gaming Authority has recently boosted its enforcement and regulatory branches, as was said at the recent Business Breakfast hosted by this paper.
This was not a moment too soon, as subsequent events showed. There is clearly a need for a robust regulatory structure as otherwise Malta’s name will continue to be besmirched by papers and countries out to carve back some of the business that Malta has meanwhile attracted.
