Malta cashes in on internet gaming

Malta is riding the crest of a wave in the internet gambling sector with no less than 27 international companies shifting their online operations to the island by the end of this month.

Intercasino - the second largest online casino in the world - William Hill, Littlewoods, Playboy Casino and Virgin Games are among the giant internet poker and casino companies that will start operating from Malta from this week.

There are already 84 internet gambling operators licensed on the island. A letter of intent has been issued to 76 others and 36 companies that have applied to operate here are still pending.

"Malta's becoming the natural hub of online gaming," Mario Galea, chief executive of the Lotteries Gaming Authority, told The Times yesterday.

The flight of a number of operators to Malta from other jurisdictions has been prompted by the introduction of the UK's Gambling Act 2005, which will come into force on September 1.

The law will only permit gambling companies based in the European Economic Area or placed on a government White List to advertise in the UK.

A White List contains jurisdictions that have proved they operate thoroughly regulated licences. Currently, Alderney and the Isle of Man are the only non-EEA jurisdictions on the list.

Mr Galea said that the government stands to raise substantial revenue in taxation and license fees. But the real benefits will be derived once the betting companies actually transfer their physical operations to Malta.

"Our regulations are very much in line with the EU's, and we have shown that we are capable of protecting operators - so it won't be long before the physical operations move to Malta," he said.

Malta's share of the internet betting industry has shot up dramatically in recent months with the closure of the American market after online gambling was banned there.

William Hill believes the move to Malta and Gibraltar will help it conduct "business as usual."

Customers of one of Europe's largest gambling companies will need to sign up to its new terms and conditions again before they can continue betting. The company has over 415,000 active accounts on its internet channels.