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The Minister of Finance of Ireland, Michael Noonan, had made attempts to enact the Ireland’s Betting (Amendment) Bill to introduce a new tax rate for online bookmakers and betting exchanges. The Betting (Amendment) Bill introduces a legal basis for the regulation of gambling, estimating that it would generate an additional €25m in tax revenue, €6m of which, will be used to support the country’s greyhound and horse racing industry, with a further €5m allocated to maintaining Ireland’s racetracks.

The Betting (Amendment) Bill was submitted to the European Commission in July 2014, including amendments enforcing a ban on unlicensed operators. The amendments allow the Irish government to issue unlicensed operators with a compliance notice, asking them to shut down their operation by a set date, and allowing companies to appeal the notice.

The country’s Minister for Justice and Equality, Frances Fitzgerald TD, announced his intention of introducing a broader gambling control bill midway through 2015, providing a framework for the wider industry. The terms of the Act would include licensing and compliance powers, and would replace existing legislation: the Betting Act 1931 and the 1956 Gaming and Lotteries Act, as well as, amending the 2002 Finance Act.

The legislation has been delayed a number of times, and, after Malta has raised its concerns in relation to licensing laws for operators who are already licensed by another jurisdiction, the standstill period it is currently subject to has been extended into January 2015.

Once the standstill period ends, the Minister of Finance will still have to progress all remaining stages of the Bill through the Irish parliament. The new tax in Ireland will hit operators like Paddy Powers and bookmakers like Ladbrokes and William Hill, which already suffered additional tax and tighter regulation in the UK.

Ireland first announced plans to regulate online gambling in 2011 when a new Finance Act sought to extend a one percent tax on bets placed in shops to wagers made online over the telephone from customers based in Ireland, however, it has struggled to pass new legislation into law since.

by Denitza Dimitrova
LL.B., LL.M., Mag.Jur.

A new gambling legislation, the Government Emergency Ordinance (GEO 92/2014), is to enter into force in Romania on 13th February 2015, after the government approved amendments, right before the end of 2014, to the country’s main piece of legislation on gambling, Government Emergency Ordinance (GEO 77/2009). The amendments in the legislation seem like a revolution for the Romanian gambling industry, and more particularly, for online gaming. Following requests from the European Commission, as well as, foreign operators, Romanian Government is now ready to abandon the restrictive measures that it had previously adopted.

The new regulation amends the taxes payable by the gaming operators (taxes expressed in Euro currency), the payment methods, as well as, other aspects relating to the uniform taxation of all amounts of money collected by players from gambling organisers for all types of games of chance: mutual betting, fixed-odds betting, matched betting, games of chance specific to casinos, games of chance specific to poker clubs, slot-machine games, video lottery (VLT), online casino games, online fixed-odds betting, online mutual betting, online matched betting and online bingo.

The legislative act establishes the obligation of the gaming operators to actively engage, including financially, in activities intended to prevent gambling addiction and the participation of minors and gambling-addicted persons in games of chance, by creating a Foundation with the main objective of ensuring compliance with the measures regarding socially-responsible games of chance, adopted by the European Committee for Standardisation.

Amongst the most remarkable amendments in the new regulation, is the new taxation on gambling that removes the 25% tax on winnings that is applicable today with a three tier system: 1% tax for all players that generate revenues between €133 and €15,000, 16% tax on revenues between €15,000 and €100,000, and, 25% tax on revenues over €100,000.

With regard to players’ winnings, the amendment establishes a tax rate of 1% of all winnings by the players, collected at source, while for remote gaming, the regulation stipulates that the winnings by players from remote (online) games of chance and slot machines, received by natural persons, are not taxable at source.

One of the most important amendments relate to online gaming, which will enable online gaming operators to legalise their gaming operation in the jurisdiction.

For online gaming operations, the legislation proposes three classes of licence:

Class 1 licence is granted to operators organising remote games of chance, who have direct contracts with players. An annual licence fee based on turnover is applicable for Class 1 licensees, with the lowest fee of €6,000 applicable to turnover of not more than €500,000 a year. The licensing fee increases incrementally in accordance to the company’s turnover, to a maximum annual licence fee of €120,000 for operators with a turnover in excess of €10,000.001 a year.

Class 2 licence applies to companies involved in traditional or remote gambling, including businesses offering game platform management and hosting facilities, payment processors, companies producing and/or distributing specialised gambling software, testing labs, affiliates, and auditors. The applicable annual licensing fee is set at €6,000 per year.

Class 3 licences apply to operators of lottery games, which remain the exclusive monopoly of the National Lottery “Romanian Lottery S.A”.

In addition to the licence fees, the proposed amendments impose an annual authorisation fee equal to 16% of Gross Gaming Revenue (GGR) for remote operators. The amendments also introduce a special 2% of GGR fee for video lottery terminal (VLT) operators and 5% fee for televised bingo.

A change in the duration of the licences has also been implemented, whereby, the licences will be valid for 10 years, instead of the current duration of 5 years.

Another novelty is the possibility of a company legally established in an EU Member State, or the European Economic Area (EEA), or in the Swiss Confederation, of applying for an online gaming licence. Also, the applicant company has to hold a bank account in which to deposit players’ money and winnings payments, with a bank licensed in Romania, or with an authorised bank in another EU Member State or in the EEA, or in the Swiss Confederation, but which operates on the Romanian territory.

The legislation also contains detailed technical and operational requirements for the operation of a remote gaming company, such as:

(i) identical to the Bulgarian Gambling Act of 2014, the gaming operator’s central IT system has a system for recording and identifying participants in the game, as well as, a system whereby simultaneous gambling sessions, every participation fee paid by every player, and, the winnings paid out to every player are transmitted and saved in real time to a mirror server and a backup server in Romanian, both of which are made available to the National Office of Gambling (ONJN) free of charge. The central ICT system must automatically record every transaction, in real time, to the mirror server made available to the ONJN and transmits periodic summary reports to the backup server;

(ii) the game server and the mirror server store all data relating to the provision of remote gambling services, including records and identification of the players, the stakes placed and the winnings paid out. Information must be stored using data storage equipment (mirror server) situated on Romanian territory, in compliance with the procedure established under the application norms of GEO 92/2014. The data will be stored in the form in which it was created, for a period of five years;

(iii) the software used to run remote games of chance, as well as, any new software version used to run remote games of chance, has to be approved in advance by the ONJN on the basis of tests carried out by an authorised laboratory, in compliance with the list approved by the ONJN Monitoring Committee, as well as, under the conditions and in compliance with a procedure established under the applicable norms of GEO 92/2014;

(iv) the communication equipment records the geographical location of a player’s IP address, as well as, the date, time and duration of their game session, once they have registered as a participant in a game on the operator’s website. The data will be stored for a period of no less than five years from the date of its collection and processing;

(v) the communication equipment and the central location at which the operator’s central IT system is to be installed is Romania or on the territory of another EU Member State, or in the EEA, or in the Swiss Confederation;

(vi) similar to the Malta Remote Gaming Regulations 2004, there is the requirement for the existence of an authorised representative of the company who must be a resident in Romanian and has powers of representation to the extent that he/she is empowered to sign contracts in the name of the licensee and to represent the same before Romanian courts and State authorities.

Other amendments relate to sanctions relating to unlicensed gambling and marketing activities.

The new regulation is expected to come into force shortly after the end of the EC standstill period on February 12th, 2015.

by Denitza Dimitrova
LL.B., LL.M., Mag.Jur.

On Wednesday, February 24th, Romania’s Government has finalised and adopted detailed technical and operational regulations for the gambling industry regarding both online and land-based companies. The revamped legislation, published by ONJN (Oficiul Național pentru Jocuri de Noroc) on Monday, 29th February, sets the rules and regulations which operators must comply with in order to obtain a licence and authorisation and to ensure the good development of their remote or land-based operation.

Regarding remote gambling, the ONJN has stated that operators wishing to offer their services to Romanian gamblers must be residents of Romania, EU or EEA, they must obtain the relevant licences and authorisations from the ONJN, and they must appoint a local authorised representative to deal with the competent authorities in the country.

The gaming and iGaming licences are granted individually for a 10-year period, and they are non-transferable between operators. For temporary games, the licence and authorisation are granted for a period of 3 months. Once the certification has been obtained, it must be displayed either on the operators’ website or in their land-based venue.

There is also a requirement that the value of stakes, the prizes for games and the value of prizes for those games that need to have a minimum payout percentage out of the total gains, be clearly displayed in Romanian language in prominent places. The stakes and limits are established both for slot machines and for AWP (Amusement with Prizes) machines. Moreover, the normative document also establishes minimum win percentages for these games in order to assure gamblers of a certain benefit.

The decision mentions also clear timetables for the paying of taxes and obligations to the state budget, as well as payment options available to the companies. The sanctions applicable to operators who do not respect the regulations are also listed, the fines ranging from RON 10,000 to RON 50,000 (approximately EUR 2,000 to EUR 11,000) depending on the contravention and on the consequences thereof. Nonetheless, if such operators provide payment within 48 hours, they will only need to pay half of the fee. Depending on the seriousness of the act, other sanctions, such as temporary suspension of licence for up to 6 months, may also apply.

Reference is further being made to the blacklist which has been compiled, with more than 500 illegal online operators already on it. The Romanian internet service providers have the obligation to block access to all the names found on the blacklist. In what concerns land-based gambling, the ONJN has a centralised information system which allows it to monitor for example slots machines or betting operations at all times, making the organising of illicit activities practically impossible. This centralised information system for land-based venues, together with the blacklisting of illegal online operators is especially opportune as it helps create a transparent industry which will benefit both operators and gamblers.

One important point in the regulation is related to the promotional material operators are using to further their business. This must be done in strict compliance with the principles regarding the protection of minors. Thus, no adverts or other marketing material must be displayed nearby schools, socio-cultural or religious establishments and such material must specifically forbid the participation of minors in gambling activities.

Another important provision of the legislation mentions the initiative to establish a foundation for social responsibility and a fund for the prevention and combating of gambling addiction, this being an area that has received increased attention over the years. Important organisations such as The Slots Organisers’ Association ROMSLOT (Asociația Organizatorilor de Sloturi) and Romanian Bookmakers, which is the association of Romanian sports betting operators, already support the development of a similar programme „Joc Responsabil” (Responsible gambling), aimed at offering as much assistance and help as possible to those fighting with gambling addiction. The legal requirement that operators must support such foundations, as well as the demand that all gambling websites display their policy related to gambling addiction and allow access to a self-assessment tool, represent an important step further in modernising Romanian online gambling and changing the negative view that some still have of it.

The undergoing changes in legislation have been a direct consequence for the Romanian National Lottery’s decision of suspending pool betting services across the country. The National Lottery has announced on its official website that it will temporarily suspend its Pronosport and Prono_S services until the relevant licences and authorisations will be obtained as per the new amendments to OUG 77/2009. On the 29th February, The National Lottery has assured its customers that the necessary applications for the said licences have already been submitted to the ONJN so that they can continue offering its services to punters in the shortest time possible.

On the 1st of March, The Romanian National Lottery has apologised to customers for this delay and has officially declared that Pronosport and Prono_S will be resuming their games as of Monday, the 7th of March. They have also added that details regarding upcoming competitions can be found at the lottery agencies, on the official website www.loto.ro and in the “Loto Prono” magazine.

ACT Consultus

The latest round of additions to Bulgaria’s blacklist of unlicensed gambling sites has added a total of ten domains in the latest update, taking the total number of sites to be blocked in Bulgaria to 323, since the introduction of the blacklist in June last year.

After having two more domains blacklisted in September by Bulgaria’s gambling regulator, the State Commission on Gambling (SCG), the Gibraltar licensed bet365 has seen its 28-365365.com site added, making it one of the most regularly-featured remote gaming companies on the list.

Of the latest additions, Digimedia is one of the most notable. Digimedia, a Malta-licensed operator, has seen its Europa Palace site blacklisted. It is the company’s second domain to be added, after the MajorTomCasino.com site was banned in October this year, with thirteen of its sites having also been blacklisted by Latvia’s regulator, the Lotteries and Gambling Supervision Inspection.

Stanjamesbet.com became the Gibraltar-based operator’s second website to be added after Stanjames.com was blacklisted in July last year. It is joined by 32Red’s Dash Casino and Nedplay brands, with the operator’s 32Red.com and sports betting, bingo and poker domains already listed. The four sites were added in January this year. The Nedplay brand was acquired in January 2010, with the Microgaming-powered site originally licensed in Kahnawake. Dash Casino is positioned as 32Red’s sister casino, although since launching in 2006, it has failed to become as prominent as its core brand.

Centurionbet’s Bet1128.com domain has been added alongside RooBet.com, a site operated by Plus 5 Gaming as a white label for Maverick, a company headquartered in London.

Another two sites, SlottyVegas.com and CasinoCruise.com, are both licensed by Malta’s Lotteries and Gaming Authority. SlottyVegas is owned by a company called NRR Entertainment, and features Microgaming software, while CasinoCruise is operated and managed by software provider EveryMatrix.

A number of Apollo’s brands, Luxury Casino, Blackjack Ballroom and Zodiac Casino, have already seen their domains added to the country’s blacklist.

Among the latest additions, all licensed by Malta’s Lotteries and Gaming Authority, feature: Betsolution4U’s Platinobet.com, Casino.net and Lucky Nugget Casino, Gaming Club’s dot.com and dot.org domains, Captain Cook Casino, Vegas Country Casino and Grand Hotel Casino, as well as, Anonibet, a sports betting operator that allows players to make deposits using the cryptocurrency Bitcoin. Active since 2011, Anonibet claims to offer players an anonymous betting experience, saying that due to its use of Bitcoin it is unaffected by regulatory restrictions.

Operators licences in other jurisdictions, such as, in Curacao – Favbet.com owned by Ukranian operator Favbet, Vbet.com owned by Radon B.V, Midas Entertainment powered by RTG and BigBangCasino.com; in Isle of Men – Annexio, PlayLottery.com and World Lottery Club, each site acting as a lottery aggregator, allowing players to buy tickets for a number of European lotteries, Wintingo.com, a site operated by Pariplay and owned by GMS Entertainment, a business which also includes games developer Orid Media, and is part-owned by video games developer Majesco Entertainment, Camasino, a webcam poker social network, and Slotser, owned by Ever Adventure IOM Ltd; UK – LottoRace, a site owned by London-listed company Bonobo plc, which offers an unique spin on lotteries, similar to a bingo product, have also been added to the extensive blacklist.

Despite the large number of operators being added to the blacklist on a regular basis, the Bulgarian regulator has awarded licences to only seven operators in the country, including the state-owned Sport Totalisator. The other operators to have secured approval to offer their online games to Bulgarian players are Eurofootball Bulgaria and Eurofootball Malta, PokerStars, Betfair, Novabet and Eurobet.

by Denitza Dimitrova
LL.B., LL.M., Mag.Jur.