Endorphina’s Head of Legal reports on the Netherlands’ new gambling law

Jakub Kolomicenko, Endorphina’s Head of Legal, shares his thoughts in a detailed report on the Nether-lands’ new gaming application process.

Press release.- Starting October 1st, 2021, the Netherlands will finally release its new law regulation for online gambling.

Jakub Kolomicenko, Endorphina’s Head of Legal, explains that the market now becomes open for all types of licenses, like bets on events during a sports match, bets on horse races, and much more. We also hear that there are no limits to the number of accepted licenses, as long as you meet all the requirements.

As of October 1st, 2021, the online gambling market in the Netherlands will finally open. The Dutch Senate approved the Remote Gambling Act in February of 2019 after years of delays. Before this, the Netherlands tried to fight only the worst offenders in illegal gaming.

Nearly two years later, the law is finally scheduled to enter full force. The online gambling licensing application process began on April 1st, 2021, and now we can finally look forward to its official beginning on October 1st.

The market only opens for the following types of licenses:

• Casino games in which the players play against the operator;

• Casino games in which the players play against each other;

• Bets on events during a sports match or on the outcome of sports matches;

• Bets on the results of horse races and harness racing organized by or under auspices of the Dutch Draf

Market surveillance is done by a regulator – the Netherlands Gambling Authority is responsible also for the licensing process. As mentioned above, the licensing process opened on April 1st, 2021, from drafting this article, the applications are just being accepted.

There is no limitation on the number of accepted licenses, therefore anyone who fulfills all requirements of the regulator is entitled to receive a license. The duration of the license is 5 (five) years, and the licensing fee is set at EUR 48,000.

Applicants should have their registered office in the EU or the European Economic Area, some exceptions are, however, admissible. Regarding server location requirements, the Control Database Specification document specifies that:

“The legislation requires that the CDB final data repository must be located in the Netherlands physically separated from the operators gambling system. Both may be located in the same data center if an operator chooses to do so, however, data stored in this main the CDB final data repository must be logistically and safely separated from any other data.”

In order to be entitled to receive the license, the decree states that the continuity of a license must be reasonably guaranteed.

Therefore, the applicant for the license shall in any case provide among other assurance report confirming that the applicant is not in bank-ruptcy, under a moratorium of payments or where the applicant’s assets are not subject to an enforceable attachment.

All online gambling applications shall also be assessed against the criteria as per the policy rules which include operating without a permit. No applicants shall operate on the Dutch market in two years and nine months preceding the date on which the application was sub-mitted and during the processing of the application.

Unauthorized operations are deemed when the following criteria are met:

The game offer took place on a website whose extension ended in .nl;

• The game offer was wholly or partly in the Dutch language;

• The relevant offer or its provider advertised on TV, radio, or printed media aimed at the Dutch market;

• For the games on offer, there was a use of domain name containing terms typical of the Netherlands in combination with the designation of games of chance;

• The website(s) on which the games of chance were offered contained any features from which a focus on the Netherlands can be deduced; and For the games of chance offered, it was possible to use means of payment that are exclusively or largely used by Dutch people.

Taxes are calculated from the gross gaming revenue of the operators currently the taxation is 30.1%. The taxation rate was increased from 29% to 30.1% from January 1, 2018, due to loss of income for the state caused by delays in the adoption of the Online Gambling Act.

According to a press release from the regulator, the gambling tax will be released back to 29% six months after the entry into force of the Online Gambling Act.

Expectations from this market are rather high. The Netherlands took its time – and at a cost of multiple delays, hopefully, they’ve prepared their regulation for the high demands of the gambling industry.