Opening an Online Casino: The Best and Worst Licenses to Go for and Why
If you are an operator and want to launch a fresh new online casino, you would need to start off by settling on a gambling license. Without a gambling license, you cannot operate and offer players entertainment in gambling in a legal fashion. While some sites want to defy all the odds and go ahead without a gambling license, there are many repercussions to face. One of these is not having solid game providers on your site and not good quality games to offer. Hence, a license is a must. If it is not something to maybe look at when business is booming, it is an investment in your future brand. Your site’s success will ultimately all be down to reputation, and reputation starts off with licensing. So let’s look at all the available licenses, the work you need to chip in to land such a license, and the pricing that it involves.
Know that as a prospective gambling site owner, you will be vetted in a big way before a gambling license is finally awarded. Your financial and tax status will be looked into, your conduct, and the amount of money you have lying around in your bank account. If you have been previously stripped of a gambling license, you can forget getting a new one, even if you are or hold a small percentage of the company that is seeking licensing. Technical tests might also be part of the application stage to see how the operator would treat your customer. At the end of the day, due diligence is needed by the licensing country/firm to make sure that you will uphold the license with transparency whilst also promoting responsible gaming.
The entities that currently offer gambling licenses are the following
- Malta Lotteries and Gaming Authority (MGA)
- United Kingdom Gambling Commission (UKGC)
- Curacao Gaming Control
- Gibraltar Gaming Ordinance
- Antigua and Barbuda Gaming Division
- Kahnawake Gaming Commission
- IoM Gambling Commission Supervision
Malta might be small in size and population, but it boasts one of the most prominent gambling licenses out there. To date, the Malta Gaming Authority has granted over 380 gambling licenses and gets tons of other applications per year to operate either in a B2B or B2C capacity. The license was launched in 2000 and attracted many online operators; however, it is when it was revamped in 2004 that it gained the attention of the online gambling world.
Malta grants you a remote gambling license; however, you need to choose which one fits the most for your structure and future plans. Here is a breakdown of the 4 licenses:
Class 1 gaming license: for all operators providing online casino games, games of chance, and games that use a random number generator. Basically, all online casinos.
Class 2 gaming license: for online sports and betting operators. Some casinos might offer only casinos, but others also offer sports; hence an additional license is needed.
Class 3 gaming license: for advertisers and promotion companies that operate from Malta. These companies could be an outsider working for a casino as a third party outlet.
Class 4 gaming license: for companies that host and manage remote gaming operations but are not themselves operators.
If you are applying for a Malta Gaming Authority License, know that you would need to fork out 2,500 Euros as initial fees. The license costs a substantial amount of money (contributions) to uphold, and gaming tax is listed at 0.05 % of the company’s turnover on an annual basis.
In 2007 a Maltese gambling license was approved by the UK as a reputable license to have and allowed all Maltese gambling licenses to operate online casino in UK and promote UK sports and other betting.
Curaçao and Netherlands Antilles
Deemed one of the most lenient gambling licenses around, welcome to the Curacao and Netherlands Antilles gambling licenses. Launched in 2020 by the Curacao Gaming Control Board, it has already awarded a whopping 400 licenses to operators.
When it comes to obtaining a Curacao gambling license, the process is not as strict as the other licenses. Maybe this is why new operators seeking to launch their business almost always seek this license. If you manage to land this license, you can also obtain sub-licenses quite easily in the future and promote the following
- Sports betting
- Casino gaming
- Exchange betting
- Live dealer casino
- Live betting
- P2P games
- Mobile poker games
- Mobile gambling
- Fantasy sports betting
- Binary options trading
- Forex trading
You might be requested to fork out a hefty 2% of all your gaming revenue if you are licensed in Curacao, and since the island became independent in 2010, it also hosts its own jurisdiction, laws, and governance. This has raised some eyebrows in the last couple of years, with a Curacao gambling license being labeled as being a gateway to tax evasion, fraud, and also scam casino sites. Unfortunately, being one of the most controversial gambling licenses to have, the industry has called for better governance and better laws by the Curacao licensing entity, and we should all expect better laws and frameworks to hopefully mirror those by the MGA and the UKGC.
As it currently stands, Curacao can grant a gambling license to any operator it deems fit without the endorsement of the former regional gambling authority. This has not worked in favor of sites hosting such a license.
There were a total of 100 gambling licenses that were awarded by the Kahnawake Gaming Commission since its launch in 1996. If you are looking into attaining or applying for this type of gambling endorsement, you would need to present the following:
- That only suitable persons and entities are permitted to operate online gaming establishments. The governing body might ask you for documents to support that you are indeed a person of trust and integrity.
- That all games are fair and yield true and random results to players. There are companies that offer such a service and make sure that your casino or sports betting site is fair for all.
- That all winners are paid their corresponding game play earnings, and all monies are kept safe. Casinos need to have a solid fraud and payment set-up to make sure this is always promoted.
The Kahnawake license might be an easy one to get, so why don’t operators go for this license? The answer is one and simple; it comes along with a massive price tag. As a new applicant, for your application to be reviewed, you need to fork out an initial CAD$ 25,000, along with a testing fee of CAD$15,000. An additional CAD$ 10,000 is needed for the first year of your operation to uphold your license. After that, all the key members of your company would need to pay CAD$5,000 annually if they are deemed to be key to the casino’s success story.
One of the reasons this form of gambling license has been so popular is that Costa Rica’s government does not deem the server place of the gaming site to be gambling, to be the actual gambling; however, the place of the gambling taking place.
There are currently 160 betting or gambling sites with this type of license, but not many of them also hold an MGA or a UKGC license. One of the things that do not picture a Costa Rica license to be so popular is due to the lack of policies, governance, and follow ups. Unfortunately, this has been one of the main reasons why many companies, both legal and illegal, apply for this license. One can have their own policies guidelines and with no monitoring.
There is not much money that you need to fork out annually to have a Costa Rica license, as only $5500 is needed. On the other hand, you will be deemed a ‘data processing’ company instead of being an igaming operator. In 2013, the country started working on future plans to revamp the gaming structure and also start collecting taxes from license holders; of course, this is still in process.
There was a time when the top destination for the biggest sports betting sites in Europe was Gibraltar, and everyone in the business seemed to be moving there. Although Gibraltar is a small portion of the European Union as a self-governing British Dependent country, it does not pay any UK tax laws. Launched in 2005 to attract many online operators, since then, a whopping 250 licenses have been granted with more than 2000 employees being employed at Gibraltar supposed sites.
As a new operator, it is hard to get a Gibraltar Gaming license, and only the most established brands will be granted such a license. Basically, if you are an operator that has made it in the industry, you will get the Gibraltar endorsement; if you are new to the business and starting off, you can forget it. In terms of costs, you would only pay a generous 1% capped at 425k, but the minimum amount is 85K. If you make it or you do not, you still need to pay. Gibraltar does not have VAT, which is still a perk.
In 2005, the Gambling Commission of the United Kingdom started operating following the introduction of the Gambling Act, and the rest is history. Suppose you are one of those players that like a reputable site that operates with strict rules; the gambling license to look for is the UK one. And if you are a new operator who wants to make it in the business and deemed a reputable site, then the gambling license you need is the Uk one.
The UK is one of the biggest gambling markets in the United Kingdom for both casino and sports, and if you want to promote your games to UK players, a license is needed. Casinos that enjoy a UKGC license can offer poker, table games, online casino, bingo, race betting, virtual sports, and even race bettings. You would need to pay a good amount of money to have a UKGC license, which includes a gaming tax set at 15%.
Since the introduction of the Gambling Act in 2005, there has been a much needed revamped to the Bill. Today, when we have members of the UK Parliament working together to see such changes happen and halt some of the most prominent advertising in the UK’s gambling scene, something that the UKGC endorses 100%. More changes are expected to make sure that taxes are paid in a fair manner, including operators located outside the UK to pay additional taxes in the UK.
Bottom line, if you are an operator that is seeking to make it big in the world of sports betting, you need a UKGC gambling license.
Antigua and Barbuda
If you are seeking to land an Antigua and Barbuda gambling license, you will have the facility to attain one of the following licenses:
- An Interactive Gaming License – This license will allow you to casino games of chance and also poker games.
- Interactive Wagering Gaming License – This license will allow you to offer sports betting.
The Antigua and Barbuda gaming license is not so popular with new casinos and betting sites looking to set shop. Unfortunately, the fees seem to outway the benefits that this license offers. To start off, you would need to pay a non-refundable amount of $10,000 just so your application is vetted. If you obtain or get rejected, you will not get your money back either way. If you will be offering casino only, the annual license is $75,000; if you want to offer sports, it is a hefty $50,000. If you offer both, you need to pay for both, of course. Just like Kahnawake, key people need to pay an annual amount of $1000 during the first year of operation and $250 annually after that.
Not many casinos and sports betting sites have this license, and this is due to the high fees that need to be paid. For example, the are many unlicensed casinos in Sweden and Uk. However, as a new operator, there are more gambling licenses that you can look into; these include Australia, Cyprus, Hong Kong, Native Territories, New Zealand. Russian Federation, Sweden, Tasmania, India, and the United States. Do your research wisely, and find the best gambling license not just for you but also for your prospective future players and customers.