The surge in overseas lawsuits against operators based in Malta has spurred the government to ponder over the introduction of additional legal safeguards. This intended amendment seeks to protect businesses from potential exposure to liability stemming from legal proceedings launched in foreign jurisdictions. This proposed course of action, however, has come under fire from European legal practitioners, who accuse Malta of attempting to sidestep local courts.
A New Protective Shield for Gaming Companies
The amendment was proposed in reaction to mounting apprehensions within the sector regarding the prospective risks linked to transnational legal actions against operators. Through the setting up of unmistakable guidelines and boundaries, Malta proposes to offer operators enhanced regulatory assurance, thereby allowing them greater leeway to concentrate on expanding their businesses and delivering secure and responsible gaming services.
The principal beneficiaries of such legislation would be operators providing their services in Europe’s grey market, where they circumvent local limitations to offer alternatives to regulated firms. These operators typically operate under considerably fewer restrictions and are often a target for local regulators. If this new bill gets enacted, such firms will operate with more impunity.
The Court shall deny recognition and, or enforcement in Malta of any foreign judgment and, or decision.
Malta Bill 55 Gaming Amendment
The bill also tackles the problem of “forum shopping,” a practice where plaintiffs deliberately select jurisdictions that might favor their claims, disregarding the operator’s primary licensing jurisdiction. Malta aspires to discourage such action by outlining clear criteria for the enforcement of foreign jurisdiction and cultivating a fair and balanced legal atmosphere for operators.
Possible Impediment for EU Courts by the Bill
The decision by Malta to proceed with this legislation had an instant repercussion abroad. Lawyers from Austria and Germany have lodged complaints with the European Commission, contending that Malta was seeking to obstruct European courts. If ratified, the amendment would instantly impede the enforcement of existing and future offenses, possibly overturning several judgments against Maltese operators.
Karim Weber and Benedikt Quarch are legal representatives for clients entangled in legal disputes against Maltese operators infringing local regulations. With a successful claim, the operators are compelled to refund the plaintiffs’ deposits and could also endure extra penalties. As per these lawyers, the proposed amendment would rob EU citizens of their fundamental entitlement to legal protection.
The Malta government has no authority to interfere in the independent arm of the judiciary…, especially when (it) seems to possess a vested biased interest entirely in favor of gaming companies.
Attorneys Karim Weber and Benedikt Quarch
In 2021, FATF‘s greylisting of Malta due to its systemic regulatory and enforcement failings marked a low point for the nation. Despite placating the financial watchdog eventually through drastic reforms, persistent corruption and money laundering are persistent niggles that continue to dent the country’s reputation. As tensions escalate, it is anticipated that the European Commission will soon resolve this matter to prevent a possible aggravation of the situation.
