European Commission issues formal notice on Article 56A; MGA responds
Article 56A, formerly known as Bill 55, allowed Maltese gaming companies to avoid regulatory enforcement by other EU members
Key points:
– The European Commission (EC) has issued a letter of formal notice against Malta for Article 56A (formerly Bill 55)
– The EC said the article “undermines the principle of mutual trust in the administration of justice within the Union.”
– The Malta Gaming Authority denied this, and stated that it will continue to support the local Government
The European Commission (EC) has issued a formal notice of proceedings against Malta for Article 56A, previously known as Bill 55. The legislation, to an extent, prevented Maltese gaming companies from being subjected to foreign court rulings.
The letter, sent to the Maltese Government, stated that the nation failed to comply with EU regulation as it imposed courts to ignore foreign court judgements, and dissuaded legal action being taken against Maltese gaming companies in Maltese courts by non-Maltese entities.
If Malta does not respond adequately to the letter, the EC may choose to bring the case to the European Court of Justice.
The EC said: “The Commission considers that the Maltese legislation, by effectively shielding the online gaming sector from cross-border litigation, undermines the principle of mutual trust in the administration of justice within the Union.”
The Malta Gaming Authority (MGA) has since responded to the letter.
The regulator emphasised that Article 56A does not force a blanket ban on EU court judgements, and in fact does not shield Maltese gaming companies from EU legal action. Instead, Article 56A reflects both Malta’s policies regarding online gaming and EU regulation and does not create space for foreign judgements to be ignored.
The MGA went on to recount that, upon Malta’s entry into the EU, its online gaming licence system was created as a point-of-supply, allowing licensees to operate across borders. As an EU member, Malta has remained within the regulatory framework set for it by the Court of Justice of the European Union and the Treaty on the Functioning of the European Union.
The regulator went on to state that ‘allowing such restrictions ultimately hinders the proper functioning of the internal market and limits the ability of companies established in Malta and other Member States to offer their services freely,’ and added that it would ‘continue to support the Maltese Government in engaging in open and constructive dialogue with the European Commission.’
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