Gambling sites, such as online casinos, betting sites and poker rooms, are relatively new as an industry. The ‘official birth of the iGaming industry’ was in 1994 when Antigua and Barbuda was the first country to pass a law which made it possible for operators to apply for licenses. While the first gambling sites looked like they were programmed by hobbyists, by the millennium they already generated €1,8 billion in revenue, while by now 85 countries have legalised online gambling, contributing to a €28 billion industry.
iGaming in the EU
According to the European Commission, annual revenues of the overall EU gambling market in 2011 were estimated to be around €84.9 billion. Not surprised at all, online gambling is mentioned as the fastest growing service activity in this sector in the EU, with 6.84 million consumers currently participating in online gambling. Annual growth rates for the gambling market are 3% while annual growth rates of almost 15% apply to the online gambling sector. Annual revenues for the online gambling market in 2015 are expected to be €13 billion, much higher than the €9.3 billion in 2011 and €10.54 billion in 2012. A nice prospect for a dynamic industry and its iGaming jurisdictions.
Providing many millions of players an online gambling experience from within the comfort of their homes, online casinos, betting sites and poker rooms have been proven to be immensely popular and lucrative. Though the rapid expansion of online gambling in the past 20 years sought a way to standardize and regulate online gambling to ensure that players are protected whilst gambling online. As online gambling in Europe is considered an economic activity which falls under the free movement of services and establishment, there is no specific EU legislation available in the online gambling industry as gambling is regulated separately by the Member States. However, a number of regulatory frameworks were set up to tackle problems like corruption and money laundering, and online gambling licenses are now issued by a number of governments including Malta, Gibraltar, and Alderney while a new gambling bill for the UK market is currently passing through parliament. Also Curacao is often mentioned as one of the ‘iGaming hubs’, already providing online gambling licenses since 1996.
None of the iGaming companies based in the European Union is operating without a license. Operators who obtained a license in one of the iGaming jurisdictions mentioned on this site, have removed any legal, reputational or bureaucratic barriers that would have been in the way running a gambling website. Online gambling in the EU is by now characterised by a diversity of regulatory frameworks, and more and more Member States regulate online gambling, although some in a more liberal way than another. EU member states who did regulate online gambling usually offer a licensing system for more than one operator, making an end to monopolistic regimes. For over 20 years the iGaming industry was plagued by such regimes, often run by either a public or a private operator on the basis of an exclusive right.
Online gambling licensing
Despite that fact that obtaining an online gambling license is a complex process, involving research and certification, there’s no way around getting one if you want to be taken seriously by banks, payment systems, software suppliers, and most important, future players. All legal online gambling businesses do possess an online gambling license in at least one of the iGaming jurisdictions in the EU, or in any other jurisdictions elsewhere in the world. The most recognized jurisdictions in Europe at the moment are Malta, Alderney, and Gibraltar. When the new gambling bill finds its approval in the UK, operators targeting UK players must have a UK license. Many operators, active in the European market, are still operating under a Curacao license, although it seems Curacao is losing territory.
Most common iGaming jurisdictions
The iGaming industry can be seen as one of the most dynamic industries with new gambling sites founded daily, often licensed by the following iGaming jurisdictions:
Malta began licensing online gambling sites in 2000, under the Public Lotto Ordinance, but it was in April 2004, just one month before the island became an EU member, revamped Remote Gaming Regulations were published making Malta the first EU member state to regulate online gambling. By now Malta is one of the world’s largest and most respected iGaming jurisdictions with over 500 licensees in possession of a Class 1-4 license granted by the Malta Gaming Authority (MGA). Read more about the Malta casino license, click here.
It is commonly known that gamblers from the UK are very friendly to iGaming, especially when it comes to sports betting and bingo while social gaming and mobile wagering have been embraced too. Online gambling in the UK generated around £2 billion (€2,6 billion) in revenue for online operators in this particular jurisdiction and white-listed jurisdictions like Malta and Alderney. So far laws (Gambling Act of 2005) relating to online gambling are relatively straightforward in the UK, but that’s about to change, thanks to a new point of consumption tax (POTC), designed to close offshore tax loopholes, operator and affiliate revenues. The new bill, the Gambling (Licensing & Advertising) Bill, including the POTC, is currently passing through parliament. Even though the POTC is project to cost UK-based operators big bucks, many operators have applied for a license in the UK, seeing the UK as a key market. Read more about the UK casino license, click here.
Also Alderney, one of the UK’s white-listed remote gambling jurisdictions, is well-known for its iGaming industry. The Alderney Gambling Control Commission (AGCC) was established in May 2000, under the Gambling (Alderney) Law, 1999, to regulate online gambling operations in Alderney. By now Alderney has been regulating online gambling for almost 15 years and adopted a conservative approach which deliberately resulted in slow growth as the AGCC was very keen to get it right rather than see it as a race for the line. Read more about the Alderney casino license, click here.
Over the years, Gibraltar has developed into an iGaming centre relying on its EU membership, even though this iGaming jurisdiction is a British Crown Dependency. Attracting major international licensees like Bwin.Party, Ladbrokes, and Betfair, Gibraltar can be seen as one of the most successful iGaming jurisdictions. The main piece of gambling legislation in Gibraltar is the Gambling Act 2005, which was last amended by the Gambling Act 2011, regulating both land-based casinos and online operators. Read more about the Gibraltar casino license, click here.
Although all the above iGaming jurisdictions are in Europe, Curacao can’t be ignored being one of the first iGaming jurisdictions to regulate online gambling. Online gambling licenses have been granted to operators since 1996. Currently, over 200 iGaming companies operate from this Caribbean jurisdiction, with online gambling as one of the largest industries on the island. Read more about the Curacao casino license, click here.