MGA Introduces Robust Capital Rules for Gaming Licensees

The Malta Gaming Authority (MGA) has officially launched its new Capital Requirements Policy, a comprehensive framework intended to fortify the financial health of licensed gaming operators. This development marks a significant stride in the MGA’s broader regulatory efforts to ensure long-term industry resilience and compliance with international standards.

Published on 2 July 2025, the policy outlines minimum capital thresholds and introduces mandatory financial health criteria for both current license holders and new applicants. According to the MGA, this initiative aims to “ultimately safeguard the integrity and sustainability of the gaming industry by obliging Licensees to have sufficient resources available for their continued and sustainable operation.”

Establishing Minimum Capital Standards

As part of the new financial guidelines, the MGA mandates specific capital levels based on license type. These share capital requirements are:

• €40,000 for Critical Gaming Supply
• €100,000 for Gaming Service Type 1 and Type 2
• €40,000 for Gaming Service Type 3 and Type 4

Entities offering multiple service types must meet the combined minimum requirements, with a cap set at €240,000. The policy allows some leeway for Corporate Group Licence holders, enabling them to meet the capital requirement collectively through one or more group entities rather than individually.

Mandatory Positive Equity Becomes the Norm

A cornerstone of the new framework is the requirement for licensees to maintain a Positive Equity Position—where total assets must at least equal liabilities. The MGA will evaluate this using financial statements, ensuring that the equity includes minimum share capital and other reserves classified as equity.

Importantly, licensees are not required to set aside their capital; it remains usable as working capital, provided that the equity position remains positive.

If, however, a licensee ends the financial year in a negative equity state, they must take corrective action within six months. Acceptable methods include fresh capital injections or converting shareholder loans into equity. While addressing such shortfalls, licensees are generally barred from acquiring new debt unless that debt is counted as capital under international financial reporting standards.

More Leeway for B2B Licensees, With Caveats

B2B providers receive a slightly more lenient treatment. They are only obligated to rectify their financial position if negative equity surpasses €3 million. Nonetheless, the MGA retains the authority to intervene earlier if it perceives a risk to the licensee’s financial stability.

The policy also allows for certain exceptions. If a company belongs to a financially sound group or has safeguards like guarantees or asset pledges in place, the Authority may permit a temporary deviation from the equity requirement.

Transition Measures and Future Outlook

For licensees already facing negative equity as of 31 December 2024, a transitional grace period may apply—potentially extending up to five years. Those with deficits exceeding €1 million are required to submit a detailed recapitalisation plan by 30 November 2025, outlining their strategy and timeline for restoring financial balance.

The rollout of this policy follows a collaborative effort between the MGA and the Malta Financial Services Authority (MFSA), formalised through a new Memorandum of Understanding aimed at enhancing inter-agency regulatory coordination.

The MGA stressed that this initiative was the product of a thorough consultation process and had been communicated to the EU’s Technical Regulation Information System (TRIS) as stipulated by Directive (EU) 2015/1535.

The Authority noted, “The new requirement to restore a Negative Equity Position will serve as an objective early warning mechanism, enabling the MGA to ensure that licensees remedy the situation at an early stage.”

While the policy takes immediate effect, a transition period will support existing and incoming licensees as they align their financial frameworks with the new regulations.

This move reaffirms Malta’s commitment to maintaining a stable, transparent, and globally respected gaming jurisdiction —essential for investor confidence and long-term sector sustainability.

Source:

‘’The MGA publishes its Capital Requirements Policy’’, mga.org.mt, July 02, 2025.