The online gaming industry is constantly growing, and now is the perfect time to launch your gaming platform. Gofaizen & Sherle provides professional assistance in obtaining a gaming license, ensuring a ready-made solution for starting and legalizing a business in the gaming industry.
The online gambling industry is actively strengthening its position and demonstrating unrelenting growth. Thanks to the introduction of innovative and dynamic technology, it is becoming a major player in the entertainment market and capturing the attention of a wide range of audiences.
When the financial sector is experiencing challenges in the global market, the gaming business is growing rapidly and covers a considerable part of the overall market.
Online gambling has become incredibly popular across all age and social groups, generating huge profits for those who decide to venture into app development or gaming platforms. The total value of the gaming market in 2022 was $63.53 billion, with an expected increase of more than 11% from 2023 to 2030.
If you want to start a legal gambling business, you need to get an online gaming license and follow the established rules of the regulatory authorities. In this article, we will look at the general conditions of licensing, as well as the prospects of obtaining gaming licenses in specific jurisdictions: Estonia, Curacao, Malta, Kahnawake, Panama, Isle of Man and South Africa.
What is an online gambling license?
An online gambling license is an official permit or authorization issued by the relevant legislative authorities or jurisdictions to legally produce and collect commissions from online gambling players. The license provides gambling companies with legal status and regulatory rules, ensuring their legal compliance and consistency with general industry norms.
A gambling license is essential for the operator as it ensures legality and increases the confidence of the players. Having a gambling license shows that the operator acts by the standards and rules of the industry and that their interests and safety are protected.
Having a license from one or more jurisdictions is an essential aspect of all highly professional online gambling companies. This document not only confirms the quality of services but also helps to strengthen the reputation of your brand. Customers prefer to turn to licensed operators, knowing that these companies do not infringe on the law and comply with ethical principles.
Who needs a gambling license?
Each operator must be licensed to operate legally. A gambling license is important at all steps of business: it confirms the company’s reputation and credibility before B2B providers and players, provides protection against legal risks, and creates new opportunities for cooperation with software developers. The terms “online gaming license” and “remote gambling license” cover all types of games played by online users.
The following individuals and companies need gaming licenses:
- Online casino operators: Beneficiaries and operators of sites that provide various forms of gambling, including – poker, slots, roulette, and other forms of betting. These activities may also include organizing online casinos and conducting various games for online streaming.
- Bookmakers: Companies that actively accept bets on sports and other events. This includes not only betting on sports but also on cybersports and live events.
- Gaming software developers: If your specialty is the creation of gaming applications, you may require a license to prove compliance with all laws and regulations.
- Payment processing companies: Companies processing payments for gambling businesses may require a license to prove they are trustworthy and protect their customers.
- Other gambling industry participants: Companies and sole proprietors who work in the gaming industry or interact with its customers. This includes service providers, consultants, and other entrepreneurs involved in organizing online poker, lotteries, fantasy games, and other forms of gambling.
Advantages of having a Gaming License
With an online gambling license, your business becomes legitimate. Having a license confirms that your company falls under the regulation of the relevant authorities and meets accepted international standards.
Some regulated jurisdictions offer low or even zero tax rates which gives licensees additional financial advantages. Operators can open bank accounts in different jurisdictions.
Confidence of players:
Customers prefer to play at licensed online casinos, as it guarantees the protection of their finances and the fairness of the game. A license increases the level of trust and confidence among players, thus attracting a new audience.
Access to markets:
An online gaming license allows your business to operate in different regulated markets and jurisdictions. This will increase the potential target audience and scalability.
Working with partners:
Having a license makes it easier to work with payment processors, software providers, and other industry partners. Most of these companies work exclusively with licensed operators.
Ensuring legal security:
Having a license protects against legal risks including potential fines and prosecution for illegal activity.
Licensed providers often provide player support tools such as gambling addiction prevention measures, which significantly improve their image among users.
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Gaming License Requirements
- The procedure for registering a gambling license is governed by serious rules affecting everyone involved, from owners to employees and partners.
- The basic conditions for obtaining a gaming license are comparable to the requirements for activities in the field of banking services.
- The presence of the necessary financial experience of the owners and staff is an important factor to ensure the sustainability of the business.
- Various suspicions of illegal activities can lead to the non-issuance of a license without a detailed review of the submitted application.
- Authorized bodies perform a business reputation check on applicants.
- In some cases, applicants may be required to fully disclose information about their financial structure, employees, and partners.
- Specialized commissions define standards for international gambling licensing to strengthen the oversight of the actions of applicants.
- As part of licensing control, eliminating gambling crime is a key objective, which ensures fair and transparent gambling activities.
- Organizations must ensure that all gambling activities under the licensee’s control are conducted openly and transparently.
- A significant objective of the licensing process is to ensure the safety of minors and vulnerable populations from possible risk and exploitation in the gambling industry.
How to Get a Gaming License
Choosing a Jurisdiction
First of all, you will need to decide on the jurisdiction in which you want to obtain a gambling license. Different jurisdictions have unique licensing requirements and conditions, so this step requires careful research and an informed decision.
Gofaizen & Sherle will help you understand the details and choose a promising jurisdiction for your business based on your needs.
Registering your business
You will need to register your business, as well as your trademarks and designs. In addition, you may need to ensure that you have servers in the selected jurisdiction.
You will need to prepare a realistic business plan, information about your key employees, the source and verification of funds, and your gambling operations.
Develop Anti-Money Laundering & Risk Policies
You will need to implement AML/KYC policies on your online platform and conduct regular independent audits. In addition, develop measures to prevent underage participation.
Prepare all necessary documentation
In this step, you will need to gather all the necessary documents and pay the appropriate fees.
Depending on the jurisdiction, you may need to provide proof of no criminal record, copies of passports of business owners and key employees, copies of utility bills and bank statements, a detailed description of the games and software offered, and a realistic business plan.
Consult Gofaizen & Sherle for a complete list of documents in your chosen jurisdiction.
Application for a gaming license
Your application should contain all necessary information, starting from the personal data of owners and key players, up to details of the business plan and description of the offered games and software. In addition, the regulatory authorities may request additional information or clarifications on individual items of the application.
Obtaining a license
After applying all necessary documents, the regulatory agency will check your information to make sure your activities will not ruin the overall reputation of the jurisdiction. If all conditions are met, you will be issued a license.
Gofaizen & Sherle will work with you to facilitate the process of obtaining gaming licenses, provide the necessary guidelines and provide detailed information about the requirements and procedures. We accompany you every step of the way to guarantee results without your physical presence.
Types of online gaming licenses
Gaming licenses vary depending on where they are issued and what activities they regulate. In the context of online gaming, here are some common types of licenses:
- Business-to-Business (B2B) license
Game developers use a license to present their gaming products to gambling operators. It allows them to enter into agreements and make their games available on virtual casino sites.
- Business-to-Consumer (B2C) license
Used to provide services directly to online casino users.
- Gambling licenses
Required for operators that offer real money games, such as online casinos, poker rooms, or sports betting companies.
- Licenses for the provision of betting services
This type of license is needed to provide betting services on sporting events or other activities.
- Gaming platforms licenses
Required for the creation and use of gaming platforms, where many types of games are presented.
- Software License
This is a license that is required for developers to create and distribute gaming software.
It is important to note that each country or region has its laws and regulations when it comes to online gaming licensing.
Popular Gaming Jurisdictions
- 0.1%-1.5% – tax on gambling activity on gross income, 0% – tax on profits and capital gains
- Member of the white list of organizations of economic development and cooperation
- One license for all types of games, valid for 5 years
- Modern telecommunication infrastructure
- Government supports the industry
- Low application fee of £5000
Gaming License Suspension or Revocation
A gaming license may be suspended or completely revoked due to a variety of circumstances resulting from a violation of the requirements and established conditions by the regulatory agency. The following are some common reasons:
- Failure to pay fees
Failure to make regular payments of license fees or taxes can result in a license suspension or revocation. It is important to ensure that all financial obligations are met on time.
- Failure to obey the law
If a company violates or ignores license conditions or applicable laws and regulations (for example, accepting bets from minors or players from prohibited regions), this can lead to disciplinary action, up to and including the revocation of the license.
- Improper bookkeeping
Proper bookkeeping and auditing controls are important aspects of gambling business management. Improper record-keeping can raise suspicions of fraud and lead to appropriate action by the regulator.
- Failure to comply with anti-money laundering requirements
Lack of convincing evidence of action taken to combat money laundering and terrorist financing can lead to severe sanctions, including the revocation of the license.
- Mistreatment of players
Failure to maintain player safety and fair gaming practices can lead to negative consequences. This includes fraud, lack of transparency regarding game rules, lack of player support, and mishandling of personal player data.
Risks of Operating an Online Gaming Business without a License
Regulation of virtual gambling establishments contributes to tax payments to the state budget and provides an opportunity to control the gambling industry, reducing the likelihood of such threats as fraud, legalization of criminal income, and the problem of gambling addiction. Doing business without an appropriate license can hurt the image and stability of the entire industry.
Without an online gambling license, companies face several problems.
- Loss of trust of the players. Usually, they choose licensed casinos, which guarantee the security of their data and the fairness of the game.
- Financial institutions may refuse to cooperate with unregulated operators, as the license guarantees that the operator is not engaged in illegal activities.
- Software and game developers often avoid working with unregulated operators to protect their reputations.
- In addition, unregulated operators run the risk of being blocked on major platforms and facing legal problems, up to and including business closure and imprisonment.
FAQ about Gaming License
How do I get a gaming license?
Obtaining a gaming license involves selecting a jurisdiction, preparing a business plan, collecting documents, paying fees, applying for a license, and waiting for it to be reviewed. If the application meets all the requirements, you will receive a license and can start working.
Which country has the cheapest gambling license?
Curacao is one of the cheapest jurisdictions to get a gaming license and it also offers a fast process.
How much does an online gaming license cost?
The cost of an online gambling license can range from a few thousand to hundreds of thousands of dollars, depending on the region. To find out the exact cost of gaming licenses in your preferred jurisdictions – we advise you to consult Gofaizen & Sherle
What country is the easiest to get a gambling license?
Curacao and Panama are the easiest countries to get a gambling license.
Which country has the best gambling laws?
Malta and the Isle of Man are widely recognized for their strict and transparent gambling laws that protect players’ interests and maintain a fair gaming environment.
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