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Remote Gaming Services

The MGA offers predominantly two types of licences, and applicants may apply for either a gaming service or a critical gaming supply licence as explained below.  Applicants may opt to apply for both, depending on the way their business operation is set up.

Gaming service licence is a business-to-consumer (B2C) licence to offer or carry out a gaming service. A critical gaming supply licence is a business-to-business (B2B) licence to provide or carry out a critical gaming supply.

The following services shall each constitute a gaming service: offering, provision or operation of a gaming service; and hosting by a person in his premises accessible to the public, the operation or making available for use a gaming device or gaming system.

The following services shall each constitute a critical gaming supply: supply and management of material elements of a game; and supply and management of software, to generate, capture, control or process essential regulatory record and/or supply and management of the control system itself on which the software resides.

Applicants applying for a gaming service or a critical gaming supply can offer one or more of the following game types:

Type 1 – Games of chance played against the house, the outcome of which is determined by a random generator, and shall include casino type games, including roulette, blackjack, baccarat, poker played against the house, lotteries, secondary lotteries and virtual sports games;

Type 2 – Games of chance played against the house, the outcome of which is not generated randomly, but is determined by the result of an event or competition extraneous to a game of chance, and whereby the operator manages his or her own risk by managing the odds offered to the player;

Type 3 – Games of chance not played against the house and wherein the operator is not exposed to gaming risk, but generates revenue by taking a commission or other charge based on the stakes or the prize, and shall include player versus player games such as poker, bingo, betting exchange, and other commission based games;

Type 4 – Controlled skill games as per regulation 8 of the Gaming Authorisations Regulations. Further information can be obtained here.

Provided further that in the case of a game displaying elements which may fall under more than one of the types referred to above, it would be up to the MGA's discretion to categorise the game in the type it believes closest reflects the nature of the game.

The MGA requires a separate approval for each gaming vertical that requires safeguards in order to ensure that it is offered in a manner which adheres to the Law and the regulatory objectives:

Casino;

Live casino;

Lotteries and secondary lotteries;

Fixed odds betting;

Pool betting, including betting exchange;

Poker and other commission-based, peer-to-peer games such as bingo, but excluding betting exchange;

Lottery messenger services; and;

Controlled skill games.

Administrative & Licence Fees

Administrative Fees Table

Licence & Compliance Dues

The Gaming Licence Fees Regulations (L.N. 409 of 2017) , were brought into force on 1 January 2018. Any person in possession of a licence issued by the MGA shall pay the Authority the appropriate non-refundable fixed annual licence fee. Licensees shall also pay the compliance contribution depending on the type of approval issued by the Authority.

Fixed Annual Licence Fee (B2C ONLY)

Fixed Annual Licence Fee (B2B ONLY)

Compliance Contribution

Gaming Service Licence – B2C

Critical Gaming Supply Licence – B2B

5% Gaming Tax

5% Gaming Tax is applied on Gaming Revenue generated from Malta based players. Determination of taxability is whether the player is established, has his permanent address and/or usually resides in Malta.

* Minimum compliance contribution for new operators will not apply until the first financial year end of operations following licence acquisition.

** Start-Ups who qualify under the Directive on Start-Up Undertakings will benefit from a moratorium period of 12 months in which they are exempt from paying compliance contribution.

To operate in the UK you need to obtain a licence issued by the UKGC, and there are predominantly three types of licences you may need. Your business may need all three depending on the way it operates:

• an operating licence
• a personal management licence
• a personal functional licence
• a premises licence is usually issued from the local licensing authority.

If you provide facilities for remote gambling (online or through other means), and advertise to consumers in Britain, you will need a licence from the Gambling Commission. 

Local licensing authorities also provide gambling permits for pubs, clubs and other establishments for low-level gambling. 

In the UK, an operator needs to pay an annual licence fee, and this is based on the type of licence.  Operators in possession of multiple licences may need to pay more than one fee. In addition, online gaming companies and any other operator offering gambling services in the UK and/or to UK customers (players) is due to pay one or more of the General Betting Duty (GBD), Pool Betting Duty (PBD) or Remote Gaming Duty (RGD) if it offers:

• betting or gaming, or both, from outside the UK to gamblers in the UK - for example, over the internet
• betting from a UK shop
• spread betting from the UK

Wherever you’re based, if you offer remote gambling, other than spread betting, to a person who usually lives in the UK, you must pay one or more of these taxes. You must register, submit returns and pay any tax due in sterling.

If you supply remote gambling that is not spread betting to customers who do not usually live in the UK, you are not liable to these taxes on those transactions.

Spread betting is betting on the outcome of financial or non-financial fluctuations of an index.

General Betting Duty (GBD)

GBD is paid by bookmakers on the profits for:

• general or pool bets on horse or dog racing, for bets placed in a UK betting shop or else by a UK person, whether in a betting shop or not.
• spread bets, where a customer makes a bet with a bookmaker who’s in the UK
• bets placed by a UK person through betting exchanges, no matter where the betting exchange is located

Pool Betting Duty (PBD)

PBD is paid by bookmakers on profits from bets that are not at fixed-odds and are not on horse or dog racing, whether the customer is present in a UK betting shop, or even if a UK person is playing on any other bookmaker, regardless of where the bookmaker is located.

Pool bets on horse or dog racing are liable to GBD.

Remote Gaming Duty (RGD)

In the UK, player winnings are not taxed, however remote gaming operators are obliged to pay a 15% Point of Consumption (POC) on all online activity. The RGD, also known as the Point of Consumption Tax (POC) was formally introduced in the UK by HMRC on December 1st 2014.  This was followed by a revised increase of 6 percentage points (pp) announced in the 2018 budget, which increased the RGD (or POC) to 21% as from 2019.  RGD is payable on all bets by UK customers (players) irrespective of where the online operator is located. 

Tax Rates

Tax is charged as a percentage of profits. Profits may be calculated as stakes received (from UK people where appropriate) less winnings paid out (to UK people where appropriate). 

To obtain an online gambling licence, an application must be filed with the National Gambling Office, after which a 10 year licence is issued for Class 1 Licences.  In Romania there are predominantly 2 types of licences available, since the 3^rd type is restricted to lottery games which are run by the State Monopoly.

In order to operate in Romania, a gambling operator must apply for both a Class 1 Licence to organise games of chance, as well as one or several authorisations to operate/offer games.

In Romania, both B2C operators and B2B operators require a licence.

Class 1 Licence: Licence for Business to Consumer (B2C) operators who want to target the Romanian players.

Class 2 Licence:  Licence for Business to Business (B2B) operators, which include the provision of gaming software and its distribution, as well as providing game platform management and hosting facilities.

Categories of B2B suppliers that would need to obtain a licence by the ONJN include the following:

·         Software providers;

·         Marketing affiliates;

·         Certification labs;

·         Casino providers (including live casinos);

·         Platform management and hosting services;

·         Game manufacturing, production and delivery to B2Cs

Class 3 Licence: This licence covers the organisation and operation of lottery games, whether as land-based or online, and which are exclusively run by the State Monopoly of Romania, “Loteria Romana”.

To obtain a licence from the Romania, a company must be established with the EU, EEA or Swiss Confederation, and operators having game servers outside the Romanian territory must implement and install a mirror server in Romania, replicating the main gambling activity as required by ONJN.

In addition to this, operators targeting the Romanian players, must appoint a local representative, who would be the key person representing the operator with the Romanian authorities.

Class 1 operators can only obtain payment services from operators in possession of a Class 2 licence duly issued by the Romanian regulator, and all transactions need to take place through a Romanian bank account.

Gambling organizer’s license fees (annual): 

II. Gambling operator’s authorization fees (annual):

The Curaçao  authorities can issue two different types of egaming licences:

• Master Licence: Curaçao  basic licence, but also allowing licencees to sub-licence.  The Master Licence allows holders to offer any type of e-gaming business, covering all casino games, sports betting, exchanges, lotteries, games of skill and chance and also bingo.  Same privileges can be passed on to the sub-licencees, who would thus be operating under the auspices of the Master Licence. (A White Label concept). Only few companies are in possession of a Master Licence.
• Sub-Licence: This type of licence is very similar to the Master Licence and allows licencees to offer all types of services which are allowed to Master Licence holders.  The main difference between the two is that Master Licence holders are allowed to sub-licence, but sub-licencees are not allowed to sub-licence to other third parties. To obtain a sub-licence, a company needs to apply with holders of a Master Licence.

The Curaçao licence allows holders to offer gaming and betting services to practically everywhere across the globe.

Obtaining a Curaçao e-gaming licence, is not considered complicated, but going through a service provider like IGA (iGaming Advisors) is a must in order to obtain a pre-approval and then be able to apply for an e-gaming and IP License. A pre-approval is usually granted within 24 hours, with the licence roughly being issued within a period of 4 to 6 weeks.

You will need to have hardware based in Curaçao with at least your customer database on the local (Curaçao) server in order to comply with the Permanent Establishment Requirement (PE). Then you can apply for a Sublicense from a Master License holder.

Once issued, a Curaçao  e-gaming licence is valid indefinitely, unless cancelled.  Hence there is no need to formally request a renewal of the licence as long as it is kept active, with the annual licence fees duly paid on time.

Curaçao tax on net profits is only 2%, but in order to obtain a licence and start your business, you need to get assistance from a corporate service provider.

Depending on whether you set up the company through the same Master licence providing you with the sub-licence or else you set up the company directly through a trust management company, incorporation and initial set up fees can obviously differ.

The solution and the type of company you opt for, will then determine your ongoing company costs in Curaçao.

In addition, one needs to keep in mind that to satisfy the Permanent Establishment (PE) requirements, servers must be located in Curaçao, and this may or may not be costly, depending on whether or not you have the right partner.

Licensing fees for the online gaming sub-licence are:

Germany The regulatory situation in Germany is constantly evolving, with information related to licensing getting updated regularly. Even though Germany has formally agreed and notified its 4th State Treaty (Interstate Treaty 2021) to the European Commission, a lot of uncertainties remain, with a number of operators still unclear on the best way to approach the German market.

This said, what seems to be clear to everyone this time round, is that from 1st July, 2021 onwards, only licences issued by the German authorities will be permitted to target German players. Such licences will need to be compliant with the laws and regulations of Germany, putting an end to EU’s largest and longest standing grey market (Germany’s population in 2020 stands at 83.7 million). In the meantime, up until the new regulations are in place, a toleration regime, aimed at sparing future licencees from any enforcement action, is currently in place.

In Germany sports betting, online lottery, casino and also poker will all be permitted, but combing their marketing and commercial uses will not be permitted. A spend limit of €1,000 per player per month will be applicable across all licensed websites, with slots being subjected to a €1 per spin stake limit, and no autoplay function and also no jackpots will be allowed.

Information on the official licensing framework, which will be adopted by the 16 federal states is still not available, but German authorities have pledged to have it ready in time before the July deadline.  In the meantime, applying for a German licence is still based on the 3^rd Treaty, hence technically only online sports betting is allowed, with the possibility to offer casino and poker remaining prohibited in Germany, whilst being considered a grey area for other EU member States.

Under the 3rd Treaty, which came into force on the 2^nd January, 2020, the Regional Council of Darmstadt, based in the State of Hesse is responsible for processing licences, even though indications are that a new regulatory authority, established through the GlüNeuRStV, will be based in Sachsen-Anhalt once the 4^th State Treaty is ratified and becomes law.

For the time being it is only possible to obtain a licence to organize sports betting remotely and/or land-based, through a formal submission of an application in German.  Applications which are not in the German language must be translated and submitted in German.  This also applies for any other official document which must be formally submitted after going through a certified translation.

German authorities require operators to appoint a German representative if a company is not based in Germany. He/She will be the main point of contact with the German authorities. As to banking solutions, operators would need to use either a German bank or any other EU/EEA banking institution, although a number of restrictions apply.

Germany - Administrative & Licence Fees Similar to the new German regulations, when it comes to Administrative & Licence Fees, the situation in Germany is still under constant development and much will depend on the way the new bill (based on the 4^th amendment of the State Treaty) will be adopted by the 16 Germans States (Länders). 

With the current situation (i.e. until the new bill comes into force), mapping out the tax dues and fees to operate in Germany can be an arduous task, since some of the fees vary depending on the State. 

As to online casino, even though up until the new bill is issued in July 2021, online casino is not licensable in Germany, operators targeting the German market with another licence, be it an EU licence or otherwise, are subject to pay VAT at 19%.  VAT for online casino is considered to fall under the category of electronically supplied services, and is based on Gross Gaming Revenue (GGR – stakes less wins).

For operators providing sports betting (in Germany betting on events which are not sports related is not permissible), a flat rate of 5% federal tax on stakes is applicable. All sports betting shops are subject to the federal tax, whether they are licensed in Germany or otherwise.  In addition to this, sports betting outlets may also be subjected to a local or federal state, based betting shop tax which can vary from one municipality to the other, and can go up to an additional 3% on stakes.

The Interstate Treaty 2021 is set to review the different taxes paid in the different German States, but it is not yet clear whether individual States will be allowed to charge additional taxes within their municipalities. As to obtaining a licence, whereas the new bill is aimed at addressing the so-called cross-border issue within the German states, where currently no cross-border access for online gambling services offered in a particular state exists, it is still not clear whether the individual states will be allowed to impose different restrictions within their state. Indications in the proposed Treaty suggest federal states will be allowed to do this and have separate and specific laws, but it is yet to be seen whether this will be the case in the finalised bill.

Same applies for fees and taxes, which are expected to go up following the ratification of the new bill. It is not yet clear whether licence fees/contributions will be determined on GGR or stakes, with some suggesting that operators generating a turnover of up to €40m will be required to pay 2% on stakes plus an annual licence fee, as illustrated below:

Proposed Licensing fees for the online gaming as per GlüNeuRStV.  These are subject to change or confirmation once the new bill is agreed and ratified by the federal states:

In Sweden there are predominantly six types of licences, but two of them are mostly utilised by international gambling operators. In addition, there are other activities which, although requiring an approval/permit from the Swedish Gambling Authority (SGA), such do not necessarily need to be covered by a licence.

The most relevant licences for online gambling operators are surely the licence which is needed to offer betting and the licence which is needed to offer commercial online gambling to players in Sweden.

• Licence for Betting – In Sweden, a licence issued by the SGA is needed to offer any type of betting, be it through authorised land-based premises, and also if offered online. All types of betting need to be covered by this licence, otherwise they would be considered illegal.  Betting on any sports events, including horse racing, betting on virtual sports races/events and also what is known as betting on lotteries (betting on the outcome of lottery draws), is covered under this licence and thus cannot be offered without.  In Sweden, betting on events where most of the players are under 18 years of age or betting on the performance of financial markets (spread betting), is prohibited.
• Licence for online gambling – This licence covers online casinos, hence includes all traditional casino games, slots, roulettes, blackjack and other online casino table games. It also covers bingo and online poker, the latter being extremely popular in Sweden, with some of the world’s brightest and most renowned players hailing from this country, having won a number of prestigious poker tournaments worldwide.
• Licence for gambling on ships in international waters – This licence is somewhat similar to the licence issued by the Malta Gaming Authority (MGA) and covers gambling activity which takes place onboard international ships, mainly Cruise Liners. Such licence covers casino type table games and slots.
• Licence for land-based gambling – Such licence focuses more on the activity which takes place inside physical premises.  Such premises may or may not require additional approvals, but in terms of the licence per se, it covers some casino type games, and mainly slots (gambling machines). This licence doesn’t allow operators to run a brick and mortar casino but instead it covers forms of land-based gambling in hotels, restaurants or other approved premises.
• Licence for state monopoly – In Sweden there are four land-based casinos called Casino Cosmopol, located in Sundsvall, Stockholm, Gothenburg, and Malmö respectively. Apart from covering the activity which takes place inside these four casinos, this licence also allows the state monopoly to offer lotteries.
• Licences for good causes lotteries – This licence is predominantly used for lotteries organised by charities, bingo events and some forms of pool betting, which have the main objective of collecting funds for good causes.

In Sweden, only Business to Consumer (B2C) operators are required to be in possession of a licence issued by the SGA, but discussions on whether to require licensing for Business to Business (B2B) operators are currently underway. SGA would be the Authority issuing such licences, should the decision to proceed with a similar requirement be approved by the Swedish authorities.

A Swedish licence is valid for a period of five years, unless otherwise specified by the SGA.

In Sweden gaming tax is set at 18% of the Gross Gaming Revenue (GGR).  In practice GGR is worked out by deducting the winnings from the wagers, but different jurisdictions may at times adopt a slightly different model, allowing (or not) the deduction of other, mainly marketing expenses. Gaming tax is due on a monthly basis.

Apart from the gaming tax, online gambling operators must pay an annual supervisory fee to the Swedish Gambling Authority (SGA), apart from the applicable licence fees.

Supervisory Fees (Annual)

In the first year of operation, whether or not the above GGR thresholds are met, gambling operators need to pay a fixed supervisory fee of 450,000 SEK (€44,595) for every licence.

Licence and other applicable fees:

Even though Regulations in the Netherlands are not yet in force, unless there are changes in the coming months, only Business to Consumer (B2C) operators will be required to obtain a Dutch licence in order to offer their services in the Netherlands. Services provided to B2C operators, though not carrying the requirement of a licence, will still be the responsibility of the B2C licensee, who will thus be responsible for ensuring compliance of the whole operation.

Licences issued by the KSA are expected to be valid for five years, unless otherwise specified by the same Authority, with licence holders being obliged to have a control database located in the Netherlands.  In addition, the KSA is expected to mandate operators to appoint an official who would be tasked with the prevention of addiction.  Such representative will be a main point of contact for the KSA.

Under the new regime, online gaming companies are expected to have four different licence types which they would need to apply for, depending on the services provided.

• Licence to offer casino type games;
• Licence to offer poker type games (p2p);
• Licence to offer betting on sports events;
• Licence to offer bets on horse racing.

In addition, licensed operators will be obliged to connect to a central database managed by the KSA, which will include all self-excluded players. B2C operators will need to query this database prior to accepting bets from players. The system will be called CRUKS, and once a player is self-excluded (or excluded by the operator) from one particular licensee, the system will automatically exclude the same player from all Dutch licensed websites. It is still unclear how this system will be implemented.

With the current plans, the Kansspelautoriteit (KSA) will start accepting applications from online operators as from April 2021, with the first licences anticipated to be issued six months later, i.e. in October 2021.  The KSA has said that these six months are needed to evaluate the licence applications, making sure operators are in line with the Dutch regulations. A one-time fee of €48,000 will be charged.

Once the Remote Gaming Act comes into force, licences approved for the Dutch market will have to pay the remote gambling tax which is set at 29% of the Gross Gaming Revenue (GGR) generated. In addition, similar to other regulatory bodies, the KSA is planning to charge a separate fee, aimed at covering the expenses related to regulatory supervision. The KSA fee will be based on GGR, with a fee of 1.5% of GGR to cover regulatory supervision, and a mandatory 0.25% of GGR to go for costs related to gambling addiction.

In addition, a fee equivalent to 10% of GGR from bets generated on horse betting is also planned to be used to support the same sport. 

Summary of Fees:

·         One-time fee on application of €48,000;

·         29% remote gambling tax on GGR;

·         1.5% of GGR to cover regulatory supervision;

·         0.25% of GGR to cover addiction related costs;

·         10% of GGR from bets placed on horse racing to support the same sport.

Denmark offers mainly two types of licences, licences to cover remote gambling and licences to cover landbased gambling.  If a gambling activity is offered in the Danish market and falls under one of the below categories, then a licence issued by the DGA is required:

• Lotteries
• Games with a mix of skill and chance
• Betting on the outcome of events

For remote gaming, operators can apply for any of the below licences or both:

Betting Licence – This licence covers any form of betting on events and includes games where the participants try to predict the result/outcome of an event. Not only betting on sporting events are covered by the term. A wager on who becomes the next prime minister is also considered betting. In Denmark, betting on events which involves animals, is only allowed under the Monopoly (Danske Spil).

Online Casino Licence – Online casino includes all the traditional online casino games: Roulette, backgammon, poker, black jack, baccarat, punto banco, online bingo, gambling on gaming machines. Online lotteries are not covered by this licence and thus cannot be offered to the Danish Market.

In order to provide gambling services in Denmark, a company must be established in Denmark or EU/EEA, or have an appointed representative living in Denmark.  Such representative must obtain approval from the Danish Gambling Authority (DGA) and will be considered as the main point of contact with the Danish authorities.

Upon payment of the non-refundable application fee (in 2021) DKK 292,300 (€39,285), the DGA will start processing the gambling application.  Individual applications for either a betting licence or an online casino licence cost c.a. €39,285, whilst an application to provide both online casino and betting, is set at DKK 409,200 (€54,996) paid in advance. 

After the evaluation process, which is always expected to take close to six months, the DGA would either proceed with issuing the licence or reject.  Licence rejections give no right to application refunds.  In addition, the DGA may also opt to grant a conditional licence or even a revenue-restricted licence for operators generating (GGR) less than DKK 1,000,000 (€134,400), with the application for the latter go down to DKK 57,200 (€7,687).

The DGA online gambling licences are valid for five years, whilst the restricted licences are usually valid for one year.  Operators in possession of a valid licence must apply for renewal during the time when the licence is still active, in order to continue with their business operation.

Operators providing gambling services must pay an annual licence fee and gambling duty based on Gross Gaming Revenue (GGR). The gambling duty is set at 20% of the GGR for online gambling, be it betting or online casino, whilst the annual licence fee can vary as per below table, with the DGA adjusting the licence fee brackets on an annual basis.

In 2021, annual licence fees are based on the below table: