Bulgaria in a hunt for unlicenced gambling websites

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 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 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. became the Gibraltar-based operator’s second website to be added after was blacklisted in July last year. It is joined by 32Red’s Dash Casino and Nedplay brands, with the operator’s 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 domain has been added alongside, a site operated by Plus 5 Gaming as a white label for Maverick, a company headquartered in London.

Another two sites, and, 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, and Lucky Nugget Casino, Gaming Club’s and 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 – owned by Ukranian operator Favbet, owned by Radon B.V, Midas Entertainment powered by RTG and; in Isle of Men – Annexio, and World Lottery Club, each site acting as a lottery aggregator, allowing players to buy tickets for a number of European lotteries,, 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.


The Maltese Jurisdiction

Malta has become the European hub of i-Gaming, licensing hundreds of gaming companies and service providers, including some of the largest and most profitable operators in the gaming industry. The Lotteries and Gaming Authority (LGA), the Malta remote gaming regulatory organisation, issues licences to gaming operators engaged in the online gaming business, offering games through distance communication, such as, casino games, poker, sports betting, P2P, lotteries, as well as gaming platforms. Remote gaming operators licenced in Malta benefit from a stable legal regime due to the robust and effective Remote Gaming Regulations (L.N. 176/04), as well as, very attractive fiscal incentives, such as very competitive corporate and gaming tax.

Since Malta is an EU Member State, where remote gaming is legally established and regulated through an effective legislation, the Maltese jurisdiction allows industry operators the free movement of goods and services within the European market. In 2004 Malta became the first EU Member State to introduce remote gaming regulations bringing forward new concepts to the i-Gaming industry. Malta’s Remote Gaming Regulations have been harmonised in accordance with the European Union legislation requirements and have been amended from time to time to reflect the requirements of the market.

Over the past six years, the Lotteries and Gaming Authority has issued in excess of 330 Remote Gaming Licences. Malta’s online gaming revenues have reached 19 million Euros in 2009, up nearly 20% from 15.9 million Euros generated during the previous year. Malta’s stable political and economic climate is also a contributing factor towards the rapid growth of the gaming industry.

Malta offers very attractive fiscal regime with advantageous corporate and gaming tax rates together with an extensive network of double taxation treaties and other legislation providing relief from double taxation. The corporate licensee is subject to income tax at 35%. However, if the shareholders are not resident in Malta or if the licensee is owned by a Maltese company 100% owned by persons who are not resident in Malta, the shareholders are entitled to a refund of 6/7 of the tax paid. Therefore, effectively the tax suffered would be of 5%. Furthermore, as Malta operates the full imputation system of taxation, any tax paid by the company is imputed to the shareholders in the event of a dividend distribution, thus tax is only paid once. Furthermore, gaming tax is capped at €466,000 per gaming licence and it is either a fixed gaming tax for certain classes of remote gaming licences or tax on Real Income generated by operators.

Apart from being regarded as a centre of excellence in the financial services sector, over the last 20 years, Malta also became a reputable ICT jurisdiction. Adopting a state-of-the-art telecommunications and hosting infrastructure with large bandwidth networks providing high capacity connections, Malta’s networks are completely digital and its international connections have been significantly expanded through satellite technology and high capacity fibre-optics linking Malta with Europe. The existence of support services to the industry, such as, online payment processors, data centers, financial services institutions, auditors, software platforms and developers, has indeed contributed towards the rapid development of the remote gaming industry on the island.

The strong regulatory regime and rigorous legislation, qualified Malta in 2007 in the United Kingdom government’s White List of jurisdictions from which online gaming companies are allowed to advertise their services into the UK market. As a result of this, in the summer of 2007, more than 20 international i-Gaming operators have moved their remote gaming operations to Malta.

The availability of highly qualified human resources is another major benefit of establishing a remote gaming operation in Malta. While the remote gaming industry is a relatively young industry, there is a vast availability of professionals specialised in the industry. Malta’s workforce is highly educated, diligent and is generally renowned for its strong work ethic and loyalty.

In 2005, the LGA introduced the Malta Remote Gaming Council (MRGC) to act as a forum between the Lotteries and Gaming Authority and the i-Gaming operators. The MRGC is made up of stakeholders in the gaming industry, including but not limited to licenced operators, lawyers and professional services providers directly involved in the industry. Any remote gaming licenced company, service provider or consultant is eligible to join MRGC.

The Malta Remote Gaming Regulations emphasizes on the adoption of anti-money laundering policies procedures, and responsible gaming and security measures for the protection of online players as well as for the gaming operators themselves.

Over the past years many international jurisdictions have been considering the liberalisation of remote gaming and opening and regulating the remote gaming market in their respective jurisdictions. Malta recognises the importance of the online gaming industry and is considering adopting further measures to make it more flexible and thus more competitive in anticipation of the worldwide changes and developments in the gaming industry.

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


Malta: Place Of Supply Rules For I-Gaming Operators As From 1 January 2015

As from 1 January 2015, new VAT place of supply rules will come into effect for EU cross-border business of electronically supplied services to non-taxable consumers (B2C). The new rules will shift the place of supply of e-services from the location of the supplier to the country of consumption or residence of the consumer.

The general rule and the exceptions to the general rule

The general rule for the supply of electronic supplied services to non-taxable persons (B2C) is that the place of supply is the place where the supplier is established for vat purposes. There is however one exception where the services are being supplied by a taxable person who has established his business outside the Community to non-taxable persons who are established in, or who have their permanent address or usually resides in an EU Member State. In this case the place of supply is the place where the non-taxable person is established, or where he has his permanent address or usually resides.

What is the current situation?

The current situation with respect to electronically supplied services to a non-taxable customer (B2C) is as follows:
1. If supplied by an EU supplier to an EU customer, the place of supply is the country where the supplier is located i.e. in an EU member state and therefore taxed therein;
2. If supplied by a non EU supplier to an EU customer, the place of supply is the country where the customer is located i.e. in the non-EU member state and therefore taxed therein.
3. If supplied to a non EU customer, the transaction would be outside the scope of VAT legislation, unless the services are used and enjoyed in the EU, in which case VAT may become due.

What does the changes consist of?

With effect from 1st January 2015, the B2C supplies provided by EU suppliers to non-taxable customers within the EU will be treated as supplied in the EU member state where the recipient of the service is established, has a permanent address or usually resides.

What are electronically supplied services?

Electronically supplied services include services relating to website supply, webhosting, distance maintenance of programmes and equipment, supply of software and updating thereof, supply of images, text and information, and making available of databases, supply of music, films and games, including games of chance and gambling games, and of political, cultural, artistic, sporting, scientific and entertainment broadcasts and events, and the supply of distance teaching.

Electronically supplied services are generally defined as services the supply of which is essentially automated and involving minimal human intervention. Establishing whether the service is an electronically supplied service or otherwise is of paramount importance. Games where the outcome is determined by an automated random number generator require minimal or no human intervention at all, while games involving live events require more human intervention in the setting and amending of the odds, monitoring the event and analysing the statistics. The latter games involve more human intervention and will thus classify them as e-services.

What needs to be done?

Gaming companies established in Malta must therefore establish the jurisdiction in which their players are located so as to apply the correct VAT treatment. Verification of the client’s IP address is not sufficient and verification need to be backed up by other evidence of where the player usually resides.

Most EU member states apply an exemption from VAT on betting and gambling transactions, however each MS would have its own rules and conditions of how such an exemption will be applied. Furthermore not all EU MS apply a blanket exemption since some member states restrict the exemption to certain gaming activities such as land-based gaming activities.

In view of the change of supply rules, iGaming operators will as from 1 January 2015 might have to start charging VAT to their players who are located in these jurisdictions. The VAT rate will depend on the applicable rate of the member state concerned. Thus the following matters should be kept in mind:
• The different VAT rates applicable in the different member states;
• Whether supplies are being made to non-taxable customers and how to determine whether a customer is a taxable person or a non-taxable person
• Analysing any applicable exemptions in the different member states in which the players reside
• The effect that this change will have on the current profit margins
• The taxable value on which VAT will have to be charged
• The manner in which invoices will be issued depending on the rules in the different member states
• Record keeping and other VAT compliance obligations in the different member states
• Legal considerations in the different member states.

by Stephen Balzan and Denitza Dimitrova


For the second year in a row, ACT Consultus has won a Mondaq Top Communicator Award!

During the Month of March 2016. Your Firm, ACT Consultus Limited (Malta) generated the most usage from our users for this category.
At the end of every month, for each country, Mondaq analyses which contributing author firms were read the most by our registered business readers: ‘Contributor Most Read’. Readership for all articles by that firm on that country is included. The reader may have come upon the article either on the Mondaq site,, via our personalised newsletters, or via one of our feeds to 3rd party sites. All readership for this article consists of real, identified individuals and no anonymous readers are included in the conferral of this award. Whilst Mondaq also distributes the same articles through major business systems like Lexis-Nexis, Westlaw, and Reuters we cannot track readership of articles through these systems and they therefore do not figure in the presentation of the award. Finally, ‘country’ is determined by the categorization of the article not the contributor e.g. if a US firm writes an article on an aspect of French commercial law the article is automatically eligible for the French and not the US award scheme.


Lithuania starts blocking unlicenced operators

After several countries, such as Latvia, Bulgaria and Romania, started blocking unlicenced websites, Lithuania followed in their footsteps. The Gaming Control Authority (GCA) of Lithuania, which is a branch of the Ministry of Finance, announced that, as per the amendments brought to the Gaming Law in the beginning of January 2016, strict controls followed by legal actions against unlicenced operators would be set in motion.

In November 2013 the European Commission requested official information from Lithuania, Belgium, Cyprus, Czech Republic, Poland and Romania, regarding national legislation restricting gambling services. The Commission was concerned that the said restrictions are not compatible with Article 56 TFEU regarding free movement of services. Ever since the European Commission requested more accurate information regarding online gambling restrictions from Lithuania and the above-mentioned member states of the European Union, the country has been thoroughly working on its regulations and is now set on blocking those websites that operate without a licence.

Previous to the new gambling regulation which came into force as of 1st January 2016, Lithuania has had a growth of illegal gambling websites, a fact which is not surprising considering the online gambling sector was not regulated until then. The Law on Games was passed in 2001, followed by the Law on Lotteries in 2003. However, nothing was mentioned in the said legislations about online gambling, making it albeit unofficially prohibited.

Now, at last, Lithuania has a comprehensive online gambling regulation which requires operators to have an authorisation from the Gambling Control Authority in order to offer their services to Lithuanian players. Operators in the EU and EEA can apply for a remote licence as long as they can open a land-based venue in the country or commit themselves to opening one within two years of the date on which they were awarded the licence. The decision whereby international operators are required to establish a land-based presence in the country has received much criticism by the European Commission when taken by other EU member states. Lithuania’s online gambling regulation, which is very similar to Belgium’s, imposes other strict measures as well, such as prohibiting operators to offer gifts and other incentives to players and precluding the advertising of competitions, lottery or tribal bets outside their land-based establishment or the website on which they operate.

Lithuania has led an extensive awareness campaign in order to inform everyone of the new procedures and caution gaming operators that if they still wanted to offer their services in Lithuania they needed to be licenced. The GCA has obtained a court’s decision whereby they can urge internet providers to block the operators which have been found without a licence. A blacklist of unlicenced operators, including William Hill, Betway and Unibet, has been compiled and will be updated at regular intervals. This list was also sent to banks and other payment processing institutions so that, similar to the method adopted in the USA, they can block payments associated with those illegal domains. Currently, the list has 85 websites and more are going to be added in the near future, the GCA’s director Virginijus Dauksis stated.

Ever since Lithuania has started the hunt for unlicenced operators, several companies have changed their domains in order to continue their online activities in the country. Although the GCA does not name the websites who have resorted to this method, it does state that several well-known operators have violated the law in such a manner. Instead of applying for a licence like the new legislation requires, these operators have just tried to bypass the blocking of their websites. The director of the GCA, Virginijus Dauksys, has deemed such repeated attempts as illegal and unethical behaviour and has stated that the institution will take action against such companies. Furthermore, he has said that changing the domain name in order to operate illegally can be considered smuggling.

Up to this point, only four operators have acquired licences in Lithuania: Olympic Casino Group, Orakulas, Top Sport and „Lošimų strateginė grupė” (Tony Bet) – the only certified online poker provider in the country.

DD Consultus