The Malta Gaming Authority has revealed that the total gross value added generated by the gaming industry during 2020 was estimated at €924m, no longer placing the gaming sector within the top three contributors to its economic value.
Representing around eight per cent of the economy’s total, the revised GVA estimates for the gaming sector are reported to be lower than in previous Annual Reports, yet the MGA noted that during an “exceptional year” where the total economy value added fell by 4.3 per cent, the gaming industry has recorded one of its highest growth rates in value added relative to other sectors, which growth rate is equivalent to 15.3 per cent.
In a year which was hit by well documented global impacts, the MGA published its Annual Report and audited Financial Statements for the financial year ending December 31, 2020.
The report, whilst providing an overview of work performed throughout the year and highlighting major projects undertaken by the Authority, also outlines the performance of the Maltese gaming industry – along with a medium-term outlook into the future.
As at the end of 2020, the number of companies licensed by the MGA, including both online and land-based entities, stood at 323, holding a total of 328 gaming licences and 357 game type approvals to offer various types of games under the B2C licence.
During the 12-month period of 2020, the MGA collected a total of €73.5m in terms of compliance contribution fees, levies, and consumption tax. It has been estimated that as at the end of 2020, the gaming industry directly generated almost 8,300 jobs in FTE terms, with 91.1 per cent of these employees engaged in the online sector.
The MGA noted that the growth in employment within the online gaming sector last year was an attribute to “planned investments and recruitment by a small number of large firms”, which went ahead with its projects despite the pandemic.
In addition, when considering the employment generated by activities in or associated with the gaming industry, the total employment in the gaming sector in Malta during 2020 is estimated to be 12,398, approximately representing 4.7 per cent of the total workforce.
In March 2020, all land-based casinos in Malta were ordered to temporarily close their venues in terms of Legal Notice 76 of 2020, entitled Closure of Places Open to the Public Order 2020, in order to combat the spread of COVID-19.
Reopening from 5 June 2020, these closures had an impact on new players’ registrations within casinos in Malta with a reported 55,676 registrations into the country’s four land-based casinos – Dragonara Casino, Portomaso Casino, Casino Malta and Oracle Casino – compared to the 175,433 registrations in 2019.
Furthermore, the total number of visits to local casinos stood at 471,862, representing a 49.8 per cent decrease when compared to the previous year – 940,766.
Yet, despite the impact on the land-based sector, its online equivalent demonstrated a degree of resilience. Whilst sportsbook operators came to complete standstill, other forms of online entertainment increased in demand.
At the end of 2020, the number of gaming companies offering online services stood at 314 – an increase from 284 in 2019. Additionally, the number of active player accounts registered on the websites licenced by the MGA grew by 18.1 per cent during 2020, reaching 36.2m. Despite the reopening of the land-based sector the report revealed that growth in the number of active players continued at “very much the same pace of earlier years”.
Alongside player accounts, the estimated number of new active player accounts stood at 15.9m, reflecting a 15.5 per cent year-on-year growth.
In 2020, the report noted that the MGA received a total of 58 applications for gaming licences whilst 68 licences were issued. Moreover, 20 gaming applications were either rejected by the MGA or withdrawn by the applicants with the Authority cancelling 12 licences and suspending another three due to various regulatory breaches.
In publishing this report, MGA CEO, Dr Carl Brincat, said: “The year 2020 will undoubtedly be remembered for the challenges the pandemic presented us with, and I am proud of the Authority’s employees who worked tirelessly to ensure that we continued to perform the functions required of us at law.
“Keeping the ship steady during a challenging year serves as a strong foundation for us to look ahead with renewed commitment to keep building on the positives and improve on our shortcomings, to reach new heights in our regulatory approach.”
Other key highlights from the 2020 Annual Report include the Authority issuing 69 warnings, along with three licences being suspended and another 12 cancelled. Thirty compliance audits were conducted by the Compliance and AML function, one of which related to a live studio, and 324 desktop reviews were carried out, of which 98 identified deficiencies which were accordingly escalated to the Compliance and Enforcement Committee.
Furthermore, eight individuals and companies were deemed not to be up to the Authority’s probity standards by the Fit & Proper Committee, mainly on the basis of mitigating the risks of money laundering or funding of terrorism.
During the 12-month period of 2020, a total of 1,475 criminal probity screening checks were undertaken, an increase of 13.5 per cent when compared to the year 2019.
To read the full annual report from the Malta Gaming Authority, click here.