64-Year Extension For Malta Casino May Trigger State Aid Case

Malta’s business community has reacted angrily to a decision to extend the lease of Dragonara Palace casino by 64 years without a competitive tender process, in a move that leaves the government open to an EU state aid complaint.

Dragonara Palace, based on a peninsular in the seaside town of Saint Julian’s, is operated on land controlled by state-owned company Casma Ltd. Its ten-year lease agreement was due to expire in 2020 until the government pushed an unopposed bill through parliament earlier this month that extended that agreement until 2083.

Under the terms of the new deal, Dragonara’s annual rent will drop from €1.2m to €500,000 for the first 15 years and then €1m a year, rising by 5 percent every five years, until the end of the lease.

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