The Malta Gaming Authority (MGA) requires licensed operators to nominate so called ‘key functions’ holders within their organization.
Key function holders are essential for the regulatory process, as they act as contact persons for the MGA, making the reporting and communication easier. EM Group provides Key Function Services for gaming operators who are licensed by the MGA. We have a team of experts who can support key positions within your organization, or fulfill these positions themselves, ensuring that you remain compliant with Maltese gaming regulations.
Every company that operates, or is planning to operate, under an MGA license, whether B2B or B2C, would need to appoint certain key function officials and certain responsibilities would be linked to these key functions.
The key function holder is a role held by a natural person who has a very strong understanding and deep knowledge of the operation and functions they are representing. These key function holders need to be approved by the MGA and will become the point of contact between the authority and the licensee.
The key function holder will be responsible for a number of tasks including, but not limited to:
- communicating with the MGA on behalf of the licensee;
- ensuring that the licensee complies with its obligations under the applicable legislation;
- liaising with other key function holders within the organization; and
- keeping up to date with changes in the applicable legislation.
A key function holder role is a very important position and operators are advised to take their time in appointing the right person for the job. Once appointed, key function holders will need to undergo regular training in order to keep up to date with changes in the law and best practices.
Operators licensed by the MGA are required to have certain essential regulatory data available at all times. The MGA Key Function roles ensure that this data is consistently accurate and up to date. As a licensed operator, it is your responsibility to ensure that your key function roles are filled by competent and trustworthy persons. We provide Key Function Services ensuring that your essential regulatory data is handled by reliable key persons. With our help, you can be sure that your gaming operation will comply with MGA requirements and run smoothly.
For a B2C licensed entity, an MGA licensed entity would need a total of eight key officials to be appointed, whilst for a B2B licensed company this number would be seven.
The full list of rules including descriptions are:
| Key Function | Description | B2C | B2B |
|---|---|---|---|
| Chief Executive Officer | The chief executive role, or equivalent. |  | |
| Chief Operations Officer, Chief Financial Officer | The management of the day-to-day gaming operations of the licensee, including but not limited to, the management of the financial obligations of the licensee, such as the payment of tax and fees due to the Authority, the processes of making payments to, and receiving payments from, players, the management of the risk strategies for the operation of the licensee, and the prevention of fraud to the detriment of the licensee. | | |
| Compliance Officer | Compliance with the obligations of the licensee as may be applicable by virtue of the Act and any binding instrument issued thereunder, including but not limited to, obligations relating to responsible gaming, obligations relating to player support, obligations relating to the rules relating to marketing, advertising and promotional schemes, and where applicable, obligations relating to sports integrity. | | |
| Legal Officer | The legal affairs of the licensee, including but not limited to matters relating to contractual arrangements and dispute resolution. | | |
| Money Laundering Reporting Officer | The prevention of money laundering and the financing of terrorism. | |  |
| Data Protection Officer | The adherence to applicable legislation relating to data protection and privacy. | | |
| Chief Technology Officer and Information Security Officer | The technological affairs of the licensee, including but not limited to the management of the back end and control system holding essential regulatory data, and the network and information security of the licensee. | | |
| Internal Audit | Providing independent assurance that an organization’s risk management, governance and internal control processes are operating effectively. | | |
Depending on the type of key function, one individual may be appointed for several key functions, as long as the roles are not conflicting (for example, compliance-oriented roles usually conflict with business-based roles).
The following table illustrates the key functions which are considered to be incompatible with each other such that an individual will not be authorized to fulfill them simultaneously:
The changes in October 2021 by the MGA (read our newsletter about this) have left licensees in a situation whereby they are not always able to provide qualified and experienced inhouse staff to fulfill these key function positions. In addition, not all key position holders are familiar with the Maltese legislative environment and its ongoing developing reporting requirements.
We can provide you with a wide range of professionals from various disciplines who can support your key function holders in fulfilling their reporting requirements whilst making sure the most up to date legislative obligations are being met.
One of the advantages is that you pay one fee, monthly or yearly, and get the experience and expertise of a dedicated team of individuals. Our team is constantly in close correspondence with the MGA and analyzing any new development in the industry to ensure your business is always on top of its game. If you prefer, we can also act as an actual key function holder, subject to certain requirements.
Additionally, we have a vast database of reporting tools to ensure a quick turnaround. Furthermore, due to our extensive knowledge in the Maltese iGambling environment we can act as sounding board for your operation in anything MGA, FIAU, finance or legal compliance related.
More information on the type of services offered by key function:
| Key Function | Type of services (non-exhaustive list) | EM Support Services | Appointment of EM |
|---|---|---|---|
| Chief Executive Officer | As required on case-by-case basis. | | |
| Chief Operations Officer, Chief Financial Officer | Drafting and reviewing of documented due diligence processes; Reviewing changes to operations and their potential impact on operations, fraud management and Business Risk Assessments (BRA); Submission of contracts that affect the operation to the authority; Ongoing review and update of operational and support processes to verify risk levels of risk based approach; Accounting and financial reporting, bookkeeping, VAT, Tax and Financial Statements filings, submission of management accounts; Monthly preparation of players’ and gaming data reports; Fraud prevention mechanisms consultancy; Support with the Risk questionnaires and queries; drafting and submitting the Business Risk Assessment (BRA); Developing the risk strategy and ongoing development and maintenance; … etc. | | |
| Compliance Officer | Drafting & maintaining the Policies & Procedures; Ad-hoc questions by MGA and/or Licensee; Assistance with forms submissions and other license applications documents; Assistance with ongoing administrative, data, records and reports submissions to the MGA; Preparing and submitting all updates and changes to the MGA; Dealing with players’ complaints; … etc. | | |
| Legal Officer | Drafting and updating Terms & Conditions; Submission of share transfer documentations or any changes to the structure; Ensuring adherence to the Gaming Act and related regulations; … etc. | | |
| Money Laundering Reporting Officer | Assisting in exercising compliance duties; Assist with the reports from FIAU and other authorities; Assist and support with preparation and submission of suspicious transaction reports; Ad hoc testing of due diligence document requests; … etc. | | |
| Data Protection Officer | GDPR/Privacy assessments and advisory; Data protection audits; Incident reports for controlled and uncontrolled incidents; … etc. | | |
| Chief Technology Officer and Information Security Officer | Please contact us for more information on this key function. | | |
| Internal Audit | Please contact us for more information on this key function. | | |
We offer tailored packages that give you the possibility to choose which services you need and budget the costs according to your requirements. From incorporating your company to applying for your Malta gaming license. This gives you the ultimate flexibility while not compromising on service, availability, or standards.
For more information about our Key Function Services, please contact Julie Courte
As communicated by the MGA, the following roles and responsibilities performed in connection with the gaming activity of a licensee shall each constitute a key function:
- For a B2C licensee that provides remote gaming services and, the key functions shall be the following:
- For a B2C licensee that operates a gaming premises which is not a controlled gaming premises, the key functions shall be the following:
- For a B2B licensee, the key functions shall be the following:
- For the National Lottery licensee, the persons performing key functions shall be the following:
(a) The chief executive role, or equivalent;
(b) The management of the day-to-day gaming operations of the licensee, including but not limited to, the management of the financial obligations of the licensee, such as the payment of tax and fees due to the Authority, the processes of making payments to, and receiving payments from, players, the management of the risk strategies for the operation of the licensee, and the prevention of fraud to the detriment of the licensee;
(c) Compliance with the obligations of the licensee as may be applicable by virtue of the Act and any binding instrument issued thereunder, including but not limited to, obligations relating to responsible gaming, obligations relating to player support, obligations relating to the rules relating to marketing, advertising and promotional schemes, and where applicable, obligations relating to sports integrity;
(d) The legal affairs of the licensee, including but not limited to matters relating to contractual arrangements and dispute resolution;
(e) The adherence to applicable legislation relating to data protection and privacy;
(f) The prevention of money laundering and the financing of terrorism;
(g) The technological affairs of the licensee, including but not limited to the management of the back end and control system holding essential regulatory data, and the network and information security of the licensee; and
(h) Internal audit.
Any B2C licensees that operate a controlled gaming premises shall also be required to appoint someone for the Management of the surveillance systems of the gaming premises.
(a) The chief executive role, or equivalent;
(b) The management of the day-to-day gaming operations of the licensee, including but not limited to, the management of the financial obligations of the licensee, such as the payment of tax and fees due to the Authority, the processes of making payments to, and receiving payments from, players, the management of the risk strategies for the operation of the licensee, and the prevention of fraud to the detriment of the licensee;
(c) Compliance with the obligations of the licensee as may be applicable by virtue of the Act and any binding instrument issued thereunder, including but not limited to, obligations relating to responsible gaming, obligations relating to player support, obligations relating to the rules relating to marketing, advertising and promotional schemes, and where applicable, obligations relating to sports integrity;
(d) The legal affairs of the licensee, including but not limited to, matters relating to contractual arrangements and dispute resolution;
(e) The adherence to applicable legislation relating to data protection and privacy;
(f) The prevention of money laundering and the financing of terrorism;
(g) Operation of the urn or any other gaming device which requires human intervention used to generate the result of the game in bingo halls:
Provided that where the operation of such urn or other device is supervised by an additional person who is not an officer of the Authority, it shall be sufficient for either the person operating the urn or other device or the person supervising to be approved to provide such key function;
(h) Management of the pit, including the supervision of the croupiers and assistants and the management of their work, where applicable;
(i) Management of the gaming area, including the supervision thereof to preclude fraud by customers, and the resolution of customer disputes
(j) Management of the surveillance systems of the gaming premises, where applicable; and,
(k) Internal audit.
(a) The chief executive role, or equivalent;
(b) The management of the day-to-day gaming operations of the licensee, including but not limited to, the management of the financial obligations of the licensee, such as the payment of tax and fees due to the Authority, and the management of the risk strategies for the operation of the licensee;
(c) Compliance with the obligations of the licensee as may be applicable by virtue of the Act and any binding instrument issued thereunder, including but not limited to obligations relating to sports integrity where these are applicable;
(d) The legal affairs of the licensee, including but not limited to, matters relating to contractual arrangements and dispute resolution;
(e) The adherence to applicable legislation relating to data protection and privacy, where applicable;
(f) The technological affairs of the licensee, including but not limited to, the management of the back end and control system holding essential regulatory data, and the network and information security of the licensee; and
(g) Internal audit.
(a) The chief executive role, or equivalent;
(b) The management of the day-to-day gaming operations of the licensee, including but not limited to, the management of the financial obligations of the licensee, such as the payment of tax and fees due to the Authority, the processes of making payments to, and receiving payments from, players, the management of the risk strategies for the operation of the licensee, and the prevention of fraud to the detriment of the licensee;
(c) Compliance with the obligations of the licensee as may be applicable by virtue of the Act and any binding instrument issued thereunder, including but not limited to, obligations relating to responsible gaming, obligations relating to player support, obligations relating to the rules relating to marketing, advertising and promotional schemes, and where applicable, obligations relating to sports integrity;
(d) The legal affairs of the licensee, including but not limited to, contractual arrangements and dispute resolution;
(e) The adherence to applicable legislation relating to data protection and privacy;
(f) The prevention of money laundering and the financing of terrorism; and
(g) The persons who hold a permit to sell national lottery games.
Conflict of Interest and Compatibility of Roles
In terms of article 9 of the Gaming Authorizations and Compliance Directive (Directive 3 of 2018), a number of roles are considered to be incompatible with one another by their very nature and, as such, a given individual will not be authorized to fulfil such conflicting roles simultaneously.
As a general rule, business centered roles are considered to conflict with compliance-based roles. Resultantly, the Key Functions relating to the chief executive role or equivalent are considered to be incompatible with the Key Functions relating to data protection, compliance, and those relating to the prevention of money laundering and terrorist financing.
The Key Function relating to the prevention of money laundering and terrorist financing is also considered incompatible with that relating to data protection, whereas the Key Function related to internal audit is considered wholly incompatible with all other Key Function roles. For the sake of clarity, ultimate beneficial owners and non-executive directors shall also be precluded from taking on any Key Functions relating to the prevention of money laundering and terrorist financing and internal audit.
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