The growing popularity of iGaming worldwide is undeniable. The industry grew exponentially in the past three years thanks to several global unforeseen events, and of course, due to the rapid technological advancements.
The gaming industry is booming with new providers and operators emerging constantly. The truth is that this type of business is very lucrative as it offers many possibilities for growing and expanding.
An online gaming business’s success depends on several factors, chief among them being the location. Although iGaming is an online-based business with players all around the world, it is crucial where the corporate entity is registered, as some countries have more favorable regulations.
Initial first steps
When starting an iGaming startup, there are many aspects to consider for success. Firstly, one should choose the market and decide between mature or emerging markets. Therefore, it is crucial to note that the landscape is influenced by innovations such as live dealers, NFTs, and cryptocurrency.
Secondly, entrepreneurs should research properly the regulations within the desired location, as the restrictions vary by country. The next step would be conducting detailed demographic research in order to understand the target audience by considering age, gender, preferred payment method, and preferences in gambling types.
Another important step when starting a gaming business is making a competitor analysis that will help you to identify their strengths and weaknesses. Examining game selection, bet configuration and payment systems will also contribute to shaping an understanding of the local tendencies. In addition, it is crucial to explore competitors’ strategies for player acquisition in order to identify gaps in the market and position accordingly.
The cost of opening an online casino should also be considered. Some of the expenses include website development, licensing, casino software, staff recruitment, and marketing expenditures. It is important to note that in some countries it is required to set up the server on the spot. As a result, additional costs will occur related to recruiting more people and launching a local office. Emerging an online casino requires not only financial resources but also time. Therefore, obtaining the license might take from several weeks to several months.
Moreover, all these components are related to the business location. Having that in mind, choosing a country for your new business sounds easy on paper, but in reality, it is an extremely complicated matter full of various small details. Let’s explore a selection of countries that offer the best environment for an emerging iGaming start-up.
Important: Please note that the fees mentioned in this article were last updated in November 2023.
Antigua and Barbuda
Antigua and Barbuda, situated in the Caribbean, consists of two islands in the West Indies. Remarkably, this nation has one of the most well-established regulatory frameworks for online gaming companies, dating back to 1994. Oversight and licensing of the sector is managed by the Antigua Gaming Authority. License fees for sports betting sites are $75,000, while for online casinos is $100,00 with a yearly renewal fee of $5,000. Additionally, corporate tax is 3%, and the application fee for an Antigua and Barbuda gaming license is $15,000. Here, it is important to note that one of the requirements is to install the server on the island.
Alderney
Alderney is a self-governing British Crown dependency located in the English Channel between France and the United Kingdom. Alderney has been a leading regulator for online gaming since 2000 and is highly regarded as a licenser. The Alderney Gambling Control Commission is responsible for issuing licenses and conducting audits within the sector. The Alderney gambling license costs approximately £17,500 and there are additional renewal fees, which depend on the revenue
Belize
Belize is a Central American country that shares its borders with Mexico and Guatemala.
The Belizean government offers a comprehensive gambling license to casino operators, software providers, and service companies within the industry. This license permits engagement in various gaming-related activities, including casinos and lotteries. The Belize Gambling License enjoys widespread popularity among online casinos globally.
What sets Belize apart is its versatile gaming license, which accommodates a wide range of online gambling activities. This streamlined approach simplifies the process of launching an online casino business for operators. Additionally, Belize offers attractive tax incentives that are based on your specific business model.
Gaming activities in Belize are regulated by the Gaming Control Board (GCB). The annual license fee costs $10,000 with $5500 in additional fees, while the renewal is $10,000.
Canada (Kahnawake)
Companies licensed by the Malta Gaming Authority can operate their online casinos and sports betting platforms in Canada without incurring additional costs. This means that even if you’re not a Canadian resident, you can legally initiate an iGaming business in the country.
Canadian locals can obtain a gaming license from the Kahnawake Gaming Commission, owned by an indigenous tribe experienced in online gambling. The advantages of obtaining a Kahnawake license include a zero-tax policy on gross gaming revenue, no additional gaming tax, and rapid setup. The application fee is $35,000 with an annual renewal of $5,000.
Cyprus
Cypris is another very popular gambling jurisdiction that issues licenses. Moreover, it is interesting that gambling within the country’s borders is typically challenging and, in most cases, illegal. However, Cyprus permits the licensing and operation of online casinos as long as the global audience is targeted and the service is not accessible to the local population.
Prospective operators are subject to standard background checks and must be approved by the Cyprus regulatory authority. This involves payment of customary fees of €30,000 for a one-year license or €45,000 for a two-year license, plus a 13% tax on all revenue. Operators must maintain a Cyprus-based bank account to facilitate the bets placed on their platform. While they can maintain separate accounts for operational expenses and company funds, the account handling payouts must be domiciled in Cyprus.
Comoros (Anjouan)
Situated in the Indian Ocean, the island state of Comoros has been granting offshore gaming licenses since 2005. Comoros distinguishes itself as one of the most streamlined, expeditious, and hassle-free destinations for commencing an offshore online gaming enterprise. Furthermore, there are comparatively few constraints associated with the license, which allows an establishment with multiple brands and website domain names to have a single license umbrella. The initial step of the Application process is the registration with Anjouan Corporate Services, the entity responsible for license issuance. Comoros offers a gaming license for approximately €17,500. It is important to note that offshore gaming businesses are exempt from taxes.
Costa Rica
Costa Rica, located in Central America, follows a rather unconventional approach to online gaming licenses. Notably, Costa Rica lacks specific regulations governing the operations of online gaming firms and does not issue any type of gambling licenses. Offshore enterprises involved in gambling, casino, or betting activities are invited to operate within the borders of the country. While the lack of regulatory oversight might discourage some businesses, it also provides them with the freedom to operate independently. In the absence of any licensing fees and corporate taxation, the way to go is by selecting a pre-incorporated shelf company that can be transferred into an online casino, or you can attempt to establish a new company from scratch.
Curaçao
When it comes to launching an online casino in the Caribbean, Antigua and Barbuda often garners recommendations from experts. However, it’s important to note that they impose one of the highest licensing fees for online gaming operations. To sidestep this substantial initial expense, many astute entrepreneurs choose Curacao.
Curacao, an island nation within the Dutch Antilles, offers a favorable landscape with a modest 2% corporate tax and complete exemption from taxation on extensive betting activities. The application process typically takes about six weeks and the application fee is €4,000. There is an additional yearly license fee, which is approximately €12,000 with tax on net income – 2%.
Germany
Germany has emerged as an enticing market for the iGaming sector. With a population exceeding 82 million, it stands as Europe’s most populated country and a focal point for numerous industries. Until a couple of years ago, it constituted one of the continent’s largest grey markets for online gambling. However, a significant transformation occurred within the last few years, which changed the country’s position on online casino businesses.
Annual licensing fees depend on an operator’s projected annual turnover, which ranges from a minimum of 0.1% of revenues to a maximum of €71,000 and it is supplemented by a 5.3% revenue tax for companies surpassing the €100 million turnover threshold. Additionally, operators must provide a security deposit of up to €25 million. Furthermore, online casino games are also subject to VAT.
Gibraltar
Gibraltar’s popularity is in many ways connected to iGaming. It has embraced the gambling culture as more than 10% of the island’s general workforce is employed within the online gambling industry.
Acquiring a license from the local jurisdiction is a relatively simple process because the application and setup processes are straightforward yet quite comprehensive. There is no application fee, however, companies aiming to establish themselves in Gibraltar must demonstrate strong security measures from reputable providers. Moreover, the principal shareholder or board members are required to have an impeccable moral record before Gibraltar grants the license.
Gibraltar has exceedingly favorable taxation policies. If your company is registered in Gibraltar, you’ll be subject to a modest 1% tax on profits, with a limit of approximately half a million pounds. The price for Remote Gaming B2C Operator, Remote Betting B2C Operator, and Other Remote B2C Gambling Products is approximately £100,000 for five years.
Isle of Man
If you’re looking to enter the UK’s extensive online gambling market, the Isle of Man is an excellent option. Here, you have the flexibility to choose from three distinct types of licenses for online gaming: a network services license, a full license, or a sublicense, tailored to your company’s specific objectives and requirements.
The Isle of Man offers a favorable tax environment, with no corporate tax imposed. However, gambling companies are subject to a modest 1-1.5% tax rate on its income, contingent on their level of success. License fees start from £5,250 on application, the same fee for a sublicense. A full license costs £36,750, and a network services license and token-based software license both cost £52,500.
Malta
Located in the Mediterranean Sea, Malta serves as the entry point for your new online casino into the European market. Malta offers the benefits of European Union membership along with access to European players. Startup expenses in Malta are comparatively modest but do fluctuate based on your choice of license.
The application fee for obtaining a license in Malta stands at €25,000. Both application and renewal fees are €5,000, and the corporate tax rate is 35%. The licensing process can take several months and requires a significant investment for higher-tier licenses.
Panama
Panama maintains strict regulations on nearly all dimensions of gambling. The jurisdiction has the authority to regulate online gambling, where operators can secure local licenses to offer a variety of betting options such as sports, auto racing, and a comprehensive selection of casino games. However, there are specific products that fall under the prohibited category, including lottery games, horse race betting, amateur events, political election wagering, and other activities, subject to the regulator’s discretion.
Acquiring a license in Panama involves an initial cost of approximately $40,000, with an annual renewal fee of $20,000. Additionally, operators are subject to a 10% corporate tax on their Gross Gaming Revenue, and the application fee costs $1000.
Sweden
Sweden is an attractive gambling destination with numerous online gaming giants operating in the country. Even though Sweden has higher taxes and fees compared to other offshore options, it offers a well-respected regulatory framework and excellent telecommunications infrastructure. One great perk is that the Swedish government doesn’t apply taxes on players’ winnings. While casinos are subject to 18% tax on their revenue, players can enjoy their winnings tax-free. Establishing your business in Sweden means tapping into a pool of talented professionals and the advantages of proximity to other gaming companies.
The industry is regulated by the Swedish Gambling Authority and it is important to know that license fees are around 400,000 SEK (€39,000). In addition, the yearly renewal fee is approximately 300,000 SEK, and the corporate tax rate is 22%.
United Kingdom
Similar to Sweden, the United Kingdom is a major player in the world of gambling. Although the country has higher tax rates and licensing fees, the advantages of establishing your presence there are substantial. The UK has a thriving betting culture, which is reflected in the remarkable gambling statistics in the last years. Moreover, the UK Gambling Commission, the regulatory body overseeing this industry, upholds strict and exemplary rules and regulations. Much like Sweden, launching your venture in a prominent nation opens doors to numerous support services, simplifies the recruitment of staff for your company, and facilitates your entry into business networks alongside fellow entrepreneurs. The initial application cost is around £5,700 with varying annual fees, while the corporate tax is 21%.
Conclusion
Selecting the optimal location to establish your online gaming startup constitutes a pivotal choice. The destination you decide upon can significantly influence your capacity for expansion, innovation, and customer attraction. Given the unique attributes of each business, there isn’t a universally superior choice.
Different companies have different priorities when it comes to selecting a location. For example, a company that wants to pay minimal taxes and deal with less restrictive regulations may find Costa Rica or Belize more suitable. On the other hand, a startup looking for a workforce with high talent and access to strong business networks may choose to launch in Sweden or the UK.
In addition, the countries we’ve discussed in this context have well-established gambling cultures. This makes them particularly appealing for iGaming businesses. Even if some countries are still in the early stages of regulatory development, they should be considered for future extension.
FAQ section:
How much does it cost to start a casino business?
The cost to start a casino business varies depending on the jurisdiction and specific regulatory requirements. For example, in some jurisdictions like Belize and Comoros, the initial licensing fees range from €10,000 to €17,500 respectively. On the other hand, more established gaming jurisdictions such as Malta and Sweden have higher initial application fees and annual renewal fees, with costs ranging from €25,000 to €39,000. Additionally, factors such as taxes, security deposits, and ongoing compliance expenses contribute to the overall investment required to establish and operate a casino business.
What countries are the easiest to get a gambling license?
Curaçao and Costa Rica are widely regarded as some of the easiest countries to obtain a gambling license due to their straightforward processes and minimal regulatory requirements. In Curaçao, operators benefit from a simplified licensing procedure with low initial costs, while in Costa Rica, operators can establish their businesses without obtaining a formal gambling license, though still subject to local regulations. Additionally, jurisdictions like Alderney and Kahnawake offer efficient licensing processes and favorable regulatory environments, making them attractive options for online gambling operators seeking a streamlined approach to obtaining a license.
What country is best known for its online casinos?
Malta is widely recognized as one of the top destinations for online casinos. Malta offers a favorable regulatory environment, access to the European market, and a well-established licensing framework through the Malta Gaming Authority (MGA). The country’s regulatory standards, coupled with its strategic location and access to European players, have made it a preferred choice for numerous online casino operators. Therefore, Malta stands out as one of the countries best known for its online casinos.
