Following the exponential growth in the iGaming business worldwide, it’s no surprise that many entrepreneurs want a piece of the pie. New companies join the action on a daily basis, but some are not aware that creating an iGaming business (casino, sportsbook, a combination of the two, etc.) is difficult and can take a lot of time and money.
One of the key factors entrepreneurs should consider is the country where they will operate. According to www.timesrecordonline.com, some countries have much better laws for an iGaming business than others and attract loads of people worldwide. Everything there is designed to help out business owners and allow them to get the best possible results.
But which are these countries, and what are the aspects you should consider when starting an iGaming business? Let’s dive in and learn more about both.
The 4 crucial aspects future business owners must research
- Before sharing more details about which countries stand out, future iGaming website owners must research several key aspects. The first and most important one is to take a look at is the regulation of online betting/gambling. Even if a country has good business laws, it may not be the best option for iGaming due to the strict rules.
- Alongside the gambling legislation, entrepreneurs should also check whether the market is emerging or mature, as well as its demographics. These two aspects are key before investing a lot of money.
- Another key step is to check the local competition. Like in any business, some iGaming operators have been here for many years, and you must go against them. This is an uphill battle that is hard to win, especially if the bookies/casinos have earned peoples’ trust.
- Lastly, we have the financial side of things. You always have to calculate the expenses related to opening and running a gambling website. These numbers will be very different, depending on the country, so let’s analyze some of the best places to start this business.
Malta
Key Stats:
- Fees – Up to €35,000 annual fee, €5000 for applying for a license
- License – Yes, the Malta Gaming Authority
- Taxes – 5%
- Pros – Reputable, you can use it across other EU countries, 5% tax, the license is valid for 10 years.
- Cons – High annual fees, the application process could take long
To maximize their potential revenue, iGaming entrepreneurs are often interested in starting their business in a location that will allow them to target multiple markets. Malta, a country located in the Mediterranean Sea, is definitely among the best options for this.
The place offers tons of benefits for website owners. Starting with the fees, applying for a license from the Malta Gaming Authority will set you back €5000. After that, there is an annual fee that is usually around €25,000. However, it can reach €35,000 if the operator’s annual revenue is more than €1M. Also, the MGA requires additional RNG certification, such as the one from eCORGA.
Generally speaking, the corporate tax in Malta is 35%, but some types of companies can benefit from a 5% tax. That’s why it’s important to talk to a lawyer.
Since Malta is in the EU, the permit from the MGA allows the site to be available in other member states, as well as in numerous countries outside the continent.
United Kingdom
Key Stats:
- Fees – Initial payment of ~￡5700
- License – Yes, the Gambling Commission (UKGC)
- Taxes – 25% corporate tax
- Pros – Recognisable, Opens the doors to one of the biggest markets in the world
- Cons – high taxes
If you are familiar with the gambling industry (especially online gambling), you know that the UK is among the leaders. Despite the relatively high taxes and licensing costs, the internal market is one of the best in the business. Some stats reveal there are more than 32M active gambling accounts in the country, so it’s safe to say locals like punting.
If you decide to start an iGaming business here, you must get in touch with the Gambling Commission (UKGC). Depending on what you want to do, your initial payment starts at ~￡5700, and there’s also an annual fee. Interestingly, the UKGC will send you an invoice 6 weeks before when you have to pay the amount so that you have enough time to prepare.
As for the corporate tax, it is 25%, which is relatively high compared to other countries. However, having a gambling license from the UKGC opens the doors to the local market, and it increases the operator’s credibility.
Bulgaria
Key Stats:
- Fees – €204,000 for an online gambling license
- License – Yes, the NRA
- Taxes – Between 15% and 20%
- Pros – A very active gambling market, many opportunities to advertise your products
- Cons – The license became more expensive, there were changes to the laws regarding gambling ads
Despite the fact that Bulgaria is a relatively small country (it has around 7M people), the local gambling market is flourishing. Business owners who analyze it will find all sorts of iGaming businesses, as well as land-based casinos and betting shops. The competition is fierce, but the low gambling tax (between 15% and 20%) means that operators can maximize their revenue.
If you decide to obtain a license in Bulgaria, you must contact the NRA. The initial fee could reach up to 20,000 BGN, and companies usually have to pay a different amount depending on the product they want to offer. There have been recent changes to the online gambling fee that operators have to pay, and it is now close to 204,000 EUR.
It’s worth noting that the Bulgarian government recently changed the gambling advertisement laws. Previously, operators had the freedom to advertise their services almost everywhere, but this is no longer the case. Although this makes everything more challenging, the growing number of casinos and bookies means that the local market is not slowing down.
Cura?ao
Key Stats:
- Fees – ~$20K for the annual license
- License – Yes, Cura?ao eGaming
- Taxes – 2%
- Pros – Low fees, low taxes, highly recognizable, available in most European countries
- Cons – The license requires early renewal
One of the reasons why a lot of gambling site owners choose Malta to start their business is because of the international license. If you decide not to operate in this Mediterranean country, you can also look at Cura?ao.
This is, by far, the most popular place to start an online casino/bookie if you want your business to be in the Caribbean region. It’s true that the licensing fees can be high, but a Cura?ao license opens the doors to many jurisdictions. Operators with this permit can work in many parts of the world.
Business owners who decide to start the Cura?ao application process will have to wait around 6 weeks. The annual license fees are usually around 36,000 ANG (~$20K), and there is also a monthly fee that is 7000 ANG. It’s worth knowing that Cura?ao does not split its licenses into B2C and B2B, the regulator considers both one type of license.
Another benefit of choosing Cura?ao is a 2% tax on net winnings. Also, since Cura?ao has a tight relationship with the Netherlands, sites with an active license can access the European market.
Cyprus
Key Stats:
- Fees – Initial fee of €30,000 for 1 year and €45,000 for two years, additional fees may apply
- License – Yes, the Cyprus Gaming and Casino Supervision Commission and the National Betting Authority
- Taxes – 13%
- Pros – Among the best places for the HQ of a gambling company, a reputable country for iGaming
- Cons – You may have to deposit a large sum of money to prove you have enough funds for an iGaming business
People who decide to learn more about most gambling companies will see that their HQ is based in Cyprus. This is not a coincidence – Cyprus is a very good place to start an iGaming business. Yes, accessing the local market can be difficult, but the government allows online gambling sites to be based there as long as they focus on other parts of the world.
Once the company is set up, the government in Cyprus must approve it. Depending on the type of products you want to offer, the initial applicant fee is €30,000 for one year and €45,000 for two. Also, companies must prove they have enough funds (they must have at least €550,000 in a bank in Cyprus or another country in Europe).
The taxes are 13%, which is much lower than in some other countries.
Costa Rica
Key Stats:
- Fees – No
- License – No gambling permits, only a Data Processing License
- Taxes – No
- Pros – Easy to set up a business, it can operate in many parts of the world, no license needed
- Cons – Not regulated, hard to access the European market
If you have ever watched the movie “Runner Runner”, you know that Richie Furst (Justin Timberlake) joined Ivan Block (Ben Affleck) in his online casino business in Costa Rica. That’s why it should not be surprising that this country is a popular place for iGaming entrepreneurs.
What’s interesting and different about Costa Rica is that the local authorities do not issue any gambling licenses. In fact, companies wishing to base their HQ there only need to have a Dota Processing License.
Some may not like the fact that the online gambling sector is not regulated. However, this also means that there are no special fees or additional taxes. Businesses wishing to start operating here must create a new company or choose a pre-incorporated shelf one.
Gibraltar
Key Stats:
- Fees – ￡100,000 annually for a B2B license, ￡75,000 for a B2C
- License – Yes, The Licensing Authority
- Taxes – 0.15%
- Pros – The country has pro-gambling laws, not that hard to obtain a permit, low taxes
- Cons – Many different types of gambling licenses
Gibraltar is in a similar position to Cura?ao and Malta when starting an online gambling business. Some sources claim that more than 10% of the island’s workforce is involved in the gambling industry, so this is definitely a place you should pay attention to.
Business owners wishing to operate here must get a license from the local authority. The application process is straightforward, and there are no initial fees. Instead, people wishing to start their business must have a clear record and have to prove to Gibraltar’s authorities that they take their things seriously.
If you do decide to operate in Gibraltar, you will only have a 0.15% tax on your profits. As for the operating costs, be prepared to pay close to ￡100,000 for your B2B License or ￡75,000 for the B2C version.
Sweden
Key Stats:
- Fees – ~€39,000 initial fees + close to €26,000 for a renewal
- License – Yes, the Swedish Gambling Authority
- Taxes – 22%
- Pros – Highly respected, the Swedish gambling market is strong, the government puts effort into offering only registered sites
- Cons – High gambling tax
Although not as big as the gambling market in the UK, Sweden is another place in Europe where you can find numerous gambling operators. Despite the higher tax rates and fees for companies, the Swedish government offers a regulated market and frees locals from paying taxes on winnings. This makes gambling even more popular.
If you decide to start an online gambling business in Sweden, you have to contact the Swedish Gambling Authority. The initial licensing fees are close to €39K, and a renewal fee is around €26K.
The gambling tax was 18% prior to 2019, but it is now 22%. The increase is due to the government’s attempt to “fight” unregulated gambling sites. Despite that, it is among the best countries to start an iGaming business.
Conclusion
According to our research, these are some of the best countries in which to start an iGaming business. They are not the only places that are worth it because a lot of companies choose places like Panama, Isle of Man, Germany, Canada, Alderney, Antigua and Barbuda, and more.
Each has pros and cons, so it’s advisable to get a skilled gambling attorney who will explain everything. Once you know all the details, you can decide what works best for you.
