Fantasy sports company DraftKings today announced that it has been granted a license by the Malta Gaming Authority under a Skill Games regulatory framework introduced by the Mediterranean island nation last year.
The Skill Games license will allow the Boston-headquartered provider of fantasy sports content to expand into other European jurisdictions. Germany will be the first such jurisdiction, as confirmed by DraftKings Chief International Officer Jeffrey Haas. Mr. Haas explained that their decision to target the German market was based on the fact that fantasy contests had a long heritage there. The company expects to go live in the country in March.
The official further noted that DraftKings could attribute its success around the US, where it derives 90% of its annual revenue from, to the fact that fantasy sports offering had already enjoyed widespread popularity there.
The fantasy sports contest provider said that it would establish its offices in Malta and will gradually extend its presence across Europe. With Malta being an EU member, the license from the MGA will allow DraftKings to enter other jurisdictions that do not specifically require licenses from their local regulators and have not prohibited the provision of fantasy sports offering.
As noted by Mr. Haas, DraftKings will be the first major daily fantasy sports provider in Germany. The company will bet on the huge popularity of football in the country (and in Europe as a whole) upon introducing its offering.
DraftKings has long been subject to bitter controversies in the US. Its issues stemmed from the nature of its offering, which many tend to view as games of chance, i.e. gambling. Generally speaking, the company allows its customers to assemble virtual sports teams of real professional players and to bet on the possible outcome of the virtual game based on statistical data collected from said players’ performance in real games. In other words, as DraftKings has been continuously trying to convince opponents, its products require a great amount of skill to be taken part in.
The US fantasy sports company first set foot in Europe last February when its UK website went live. DraftKings was allowed to enter the local market after being granted a license by the UK Gambling Commission. It agreed on a gambling license as there are no specific regulations regarding daily fantasy sports in the country. Mr. Haas said that figures from the UK have been encouraging so far and that they hoped their German operations will, too, enjoy a good start.
Malta’s Skill Games Regulatory Regime
Malta has been among the jurisdictions to have remained persistent in keeping up with the trends in the gaming and gambling industries, hence its reputation of a popular destination for both operators and suppliers to base their offices in.
It was last summer when the Malta Gaming Authority adopted a new regulatory framework that designated daily fantasy sports as games of skill. In other words, the regulatory body deemed it necessary to treat that type of gaming products in different manner in terms of licensure and regulation. Despite it gave the games a status that separated them from gambling, the authority noted that they posed a certain level of risk to customers and thus required regulatory intervention when needed.
