Episode Transcript
[00:00:00] Welcome everyone. So let's check the Maltese license and MGA license today and understand what it takes to get the license. And also why should you get one?
[00:00:14] So the MGA license is a completely different story. It's not like the license of Curacao, where any startup has pretty good chances to get one. So with the Curacao license, any startup, even if you start yourself as a lonely wolf, so to say, you have pretty decent chances if you have a bit of experience, if you have a little bit of capital to get the carousel license, when it comes down to mga, to the Maltese license, then the license will assess you and your team and they will decide whether or not you are applicable for the license. So it's a good chance that you are not.
[00:00:56] And there are three questions that I like to ask to understand whether or not you are ready for the license of the mga.
[00:01:05] So the first question is, how long, for how long are you in this business?
[00:01:11] Because the license is not for everyone. This is probably not a good choice for the startup to start with.
[00:01:18] And you know, the time that you spend in the business will also define the experience that you have and also the understanding of the market and whether or not you actually need the MGA license. The second question is how big is your team and how big is the experience of your team?
[00:01:40] Because it's not just about the quantity and how many team members do you have, but also about the experience. Because certain experience have to be in place for the MGA to consider you serious, to consider you experienced enough, and to believe in you that you can maintain, sustain the business.
[00:02:02] And the third question is, do you have the financial resources? Because it's not cheap, the MGA licenses times more expensive other than the Curacao license. And it requires some commitment, both financial and time commitment, to actually get through all the bumps and all the road bumps to get the MGA license. So let's start with the first one, right? So let's go ahead and check. Why would you need the MGA license, why people buy MGA license, why business, Business owners should consider mga.
[00:02:42] And the reasoning is huge. It's so many to gain with the MGA license. Well, the first thing is of course players themselves, right? So when you want to attract sharks, certain people like really experienced guys, guys who spend money playing games, they want to see this magic MGA logo in the footer of your website to consider you well worth spending time with you. So you have this MGA logo. If you have the license and your license is active, then you spend a good amount of money, you have a good team on board, and this is also a guarantee that they will get their earnings if they win. Right? So that's the first thing. It's huge one. The second big thing is investors. Because if you want to attract 5, 10 million in your business, you and you would want to put your business on a table for investors to consider whether or not it's worth investing in your business, then MGA license has all the procedures and terms and audits in place to basically lift up your quality of earnings. So an investor looking at your financials, he will know exactly that these financials are valid and that there is nothing like, you know, that you keep behind the table. So it's, it's a completely different deal for them and it's completely different deal for you. Because finding an investor is much easier with the MGA license. The third thing, why you want to consider the MGA license is the ipo. If you plan to go for the ipo, you have all the financials in place, you have all the recommendations, you have all the audits done by all the greatest companies out there. So it's the only way for you to go public. You cannot go public with the license of Curacao only and the MGA license or other tier 1 license like the Isle of Man is necessary for you to go public. Another thing is of course banks, payment system providers, software providers, because not everyone wants to work with operators who have the carousel license only if you want to have the broader range of choices. If you want to work with banks, banks that do not work with Taiwan II licenses, if you want to have software providers like, well, Betfair doesn't work with the license of Curacao, for example, then the only choice for you is to get the Taiwan license, which is the Maltese license. Another thing why many business owners consider MGA license is the actual focus on Europe.
[00:05:26] So the Maltese license is great when you want to work in European Union and you want to connect countries like Germany, Sweden, Italy, Spain, all countries that have the local license. Because if you have the Maltese company and if you have a Maltese license, you can have all the local licenses collected under one roof. So you just need the Maltese license and you do not have to incorporate companies separately in Germany, Italy, Spain, France, wherever.
[00:05:58] So it's a good start, it's a good starting point to get all the local licenses later. Another thing with European licenses is that it will be much easier for you to get like Italian license, for example, if you already have a Maltese license because there are like 80% of, 80, 90% of like overlapping procedures and processes and terms that you already passed with the Maltese license. So it's just like walking the park to get the any other local license because they are checking the same things, they are looking at the same things and they you basically you are pre approved for the license already.
[00:06:45] Okay. So when it comes down to the licenses, so you have two options, both options like B2C and B2B. So let's check what it requires for you to get through and to get the license. So it's five steps. The step number one is called fit and proper test.
[00:07:00] So whether you and your team is fit for the business, whether you know the business, whether you have the experience for the business because it's just not enough for you to be there. You have to have certain experience. So for example, like your CEO has to have three years of experience and also some degree, like a bachelor degree in order to get into the game. The same applies for your technical officer, the same applies for your audit officer. And there are many positions that you have to fit in as a part of your fit and proper test to actually move on forward. So I have all these positions on my site on licensedgentleman.com I will leave you the link right below this video. So go and check all the positions that you have to fill in and the proper. So whether you are in your team as proper to apply for the license, do you have your background check? Do you have any criminal records? So you are person as well as the person of all key people will be validated and checked by all the norms at kyc. So you will be checked by different institutions. And if you are good, if you do not have any, you know, background experience, so to say, then you are good for the next step. The next step is financial and business assessment. This is literally where you know the MGA will take your business plan.
[00:08:24] They will look in the numbers and they will try to understand based on what you have in your three years plan, whether you actually walk the talk. So they will see the numbers, they will see your budget, they will see whether or not you have resources and people to achieve your vision. And if you do, then you are fine to go to the step number three. And the step number three is designed to evaluate whether you have all the paperwork in place, whether you are in a good condition to start the business. So they will evaluate all the tools that you have. They will see whether you have all the agreements with software providers, banks, payment system providers, who Are these your partners? They will go through your terms and conditions. So they will understand if you have all the technical documentation in place to then move you forward to the step number four. That is going to be the key step. And this is the step where they will agree to either issue the license or they will just drop your application.
[00:09:23] So the last step is designed to understand if your technology and if your plan, it plan is actually in order to your vision, to what you have described before in your business plan and in your application. And then now they will check it against the reality. So what you have currently, what is there that you have now with all the data centers and with all the partners that you have signed with your business, and if the difference is minor, nothing big to change, then you are fine. And then they will move you to the step number five, that is the issuance of the license. Before the step number five though, you will have to pay the share capital based on the type of the license that you apply for. So there are four types of the license. The type number 1, 2, 3, 4. The first license is basically all the games of chance. So this is where we go with the random number generator games that you play against the casino and all the poker games, all the blackjacks and all other stuff. So the license, the type number two is for example, sportsbook, right? So this is something that is not related to the random number generator, but is generated by the license events. Type number three is where operators generate their revenue by taking the commission for the space they provide. So for example, P2P platforms, betting exchanges are all applying for the type number three. Type number four is when you have the controlled game of chance. And this is where the MGA will evaluate every game that you have and they will decide whether or not you are applicable. For the the type number four, maybe that's type number one, right? So this is for example, the fantasy games.
[00:11:12] So for the type number one and type number two, you will have to pay the share capital equal to €100,000, where the type number three and four will have to pay the share capital of €40,000. When it comes down to the size of your team, then you have to understand that there are several positions that you, you have to fill in. I already described that all of them have to have certain experience like CEOs and AML officers and technology officers and so on and so forth. But all these key people, they will have to go through a certain KYC procedure.
[00:11:47] So our MGA will evaluate a proper test on them as well. So they will have to collect all the paperwork and you can download all the package right from the site, right from the licensed gentleman.com I'm sharing it there. It's 100% free.
[00:12:02] And then as soon as we have all the package, you have to apply this with MGI as they will evaluate everything and then they will also attract third party agencies to basically double check some parts of your background to make sure that you do not have something to hide. Right.
[00:12:25] The Malta was the first EU state that actually legalized the online gambling and created this license. So they are way ahead of other states as they have the best infrastructure, they have the best servers and hosting providers, they have the best accountants, legal experts, they have banks and payment system providers and they have also the biggest density of of online gaming professionals. So this is just the haven for uhr. If you are looking to move your office to Malta, if you are looking to hire people in Malta, having the MGA license is going to be much easier because now you have a pool of talents to choose from and they are all located in Malta. Okay, now let's switch a bit to taxes because in Malta you have the lowest corporate tax in the entire European Union, which is great for the business because the effective tax rate is just 5%. Of course it's more complicated than that because it's initially 35% and then you get return your 30% so you end up paying just 5% on your profits.
[00:13:35] So that's it for Malta. If you have any questions then please shoot me a message. I will leave my contact details in the details details of my team below this video. Go visit the site, download all the templates. You can find the contact details there. If you want to apply for the Maltese license and you have more questions and you believe that I didn't cover something, there are tons of things that I didn't cover, then please go ahead and send me a message and I will be happy to help you out.
[00:14:06] So looking forward to seeing my next video and have a good day.
