The Maltese regulation of digital games (with prize) in the light of EU law

Abstract

The continuous developments affecting the digital gaming industry have generated innovations in business models, gameplay, playing devices and communication technologies. The growth of cross-border gaming operations and game development companies created new employment opportunities, gaming formats and monetisation systems that presented new challenges for regulatory and legislative institutions that are mandated to ensure that players are safeguarded from illicit practices, such as identity theft, whilst enforcing measures to prevent money laundering, illegal gambling and tax evasion practices. In response to the rapid expansion of the services sector, the EU intensified its efforts to attain an internal market primarily by enhancing the fundamental freedom provisions through the enactment of various European law. However, the pace of the legislative processes in the Union contrasted sharply with the rapid changes occurring in the digital gaming industry. This asynchronous relationship is pervasive and can also be detected in other countries at different levels of jurisdiction. The effects of this regulatory conundrum are analysed to discern its implications for the digital gaming sector and for consumer protection. A diachronic and synchronic comparative study of Maltese and EU regulation was undertaken focusing on the provision of digital games (with prize) services in contrast to gambling services. This entailed a detailed consideration of the concepts of 'chance' and 'skill', the characteristics of online skill games and their variants, the fundamental freedoms provisions of services and establishment, the Services Directive, other relevant EU legislation, the decisions handed down in various juridical jurisdictions, and the legal frameworks developed in selected foreign countries. This study formulated the basis for the critical analysis of the actions and changes that constituted the development of the proposed Maltese Regulation of digital games (with prize).