LICENSING IN CURACAO AND MALTA 2020-2021

Many fledgling gambling entrepreneurs pick Curacao as their licensing jurisdiction. It's understandable since it comes with a reasonable price and the licensing process is comparatively simple. Here we outline the basics of licensing in Curacao. 

Curacao is a tropical island in the Caribbean under the jurisdiction of the Netherlands with the burgeoning economy not in the least boosted by the tourism and gambling industry. Curacao, one of the first countries legalizing online gambling, started issuing licenses in 1996 becoming an attractive spot for gambling-related entrepreneurs. The jurisdiction has low taxes, a thriving business climate, and developed infrastructure. Gambling activities on the island are regulated by the Curacao Ministry of Finance and Curacao Gambling Control Board also responsible for preventing money laundering and financing of terrorism (AML/CTF checks) since 2019. 

Curacao licensing system includes master licenses and sub-licenses. Master licenses are issued exclusively by the Curacao Ministry of Justice. Sub-licenses can be issued by any master license holder. Apart from that, there's no difference between these two types of licenses as both don't impose restrictions on the types of gambling activities their holders can provide. 

There are only four holders of master licenses:

• Antillephone NV
• Curacao Interactive Licensing N.V.
• Cyberluck Curacao N.V.
• Gaming Curacao

The rest of the gambling operators are sublicensed by them. Each of these organizations has its own terms and policies applying to sublicensees. A sublicense is valid while its master license is valid; the latter has to be renewed every 5 years.

LICENSE YOUR GAMBLING BUSINESS IN CURACAO

According to the statistics, the online gambling industry is consistently growing, with its turnover increasing each year. The forecasts remain positive despite current economic troubles. No wonder, gambling always was and remains an important staple in the sphere of entertainment drawing the unwavering interest of investors. 

Some important reasons to get a license

• Holding a gambling license you can operate as a legitimate business, the only alternative being a shadow area, where you can run into serious problems with the law at any moment.  
• Without a license, you will have trouble opening a bank account, as financial organizations are generally wary of unlicensed operators.
• A license will make your casino look more trustworthy from the players' point of view, which will contribute to increasing your customer base.
• As a licensed business you'll have a much better reputation in the gambling business community, and your activities, in turn, will help the gambling ecosystem to grow, gaining respect and credibility.
• Gaming software providers are reluctant to cooperate with unlicensed gambling operators, so having a license is important in terms of providing your clients with quality content. 

STEP BY STEP GUIDE ON LICENSING IN CURACAO

Licensing in Curacao is comparatively simple. Still, there are nuances that need to be taken into consideration, not to mention the importance of thorough compliance with requirements and conditions attached to the license.     

Licensing process in Curacao

• Register your company in Curacao
• Set up your gambling site and make sure that it's in working condition and ready for technical review.
• Submit your application to one of the master license holders
• Before issuing the license, the master license holder will initiate a technical inspection of your gambling platform in order to confirm that it meets the issuer's standards.
• Given that all the submitted documents are in order and the site meets the necessary requirements, you will receive the license in approximately 6 weeks.

The list of documents required to apply for a gambling license in Curacao

• Utility Bill (not older than 3 months)
• Passport copy.
• Resume or CV
• Good Conduct Certificate.
• Reference letter from your bank.
• Professional reference letter.
• Second ID.

The list may contain additional entries, according to the policies of the licensor you apply to. An important thing to remember is that all the paperwork needs to be thoroughly checked and reviewed before the application since any inaccuracy can lead to the applicant being turned down.  

Our company provides consultations and assistance with the licensing process

• Business and legal consulting in regard to your chosen gambling jurisdiction
• Gambling business registration
• Registering bank accounts
• Assistance with paperwork and license application

LICENSING RELATED EXPENSES IN CURACAO

Licensing in Curacao is considered cheap compared to other jurisdictions. Your overall expenses will include: the license fee that can vary depending on the licensor - a master license holder - you will apply to, legal and administrative costs related to your company registration, and local representative fees you are required to pay during the first year of operation. You will also want to add the cost of your platform backups, mandatory according to local online gambling regulations.

Apart from low licensing expenses, you can benefit from the Curacao tax system favoring gambling businesses. You are obligated to pay 2% income tax and license renewal fees, and there is no gambling tax as opposed to other jurisdictions less lenient on gambling.

How much you will spend on licensing and related procedures depends on the specifics of your offer and other nuances. To avoid unnecessary expenses and complications you can delegate the licensing process to the professionals who will find the optimal and least costly way to make your business legitimate.

LICENSING IN MALTA

The island of Malta located in the Mediterranean is another go-to place for entrepreneurs aspiring to legitimize their gambling businesses. As opposed to the Curacao license covering all types of gambling-related entertainment, Malta issues different licenses for different types of operations. The institution tasked with authorizing gambling companies in Malta is Malta Gaming Authority (MGA)

Depending on the type of gambling activities your online casino offers, you need to license each type separately. For example, if your casino features poker games or betting on sports each specialty requires an additional license. Overall, there are 4 types of licenses covering respectively: standard casino games, poker, sports betting, fantasy sports. Annual fees for each license are €25,000 with the exception of a fantasy sports license that costs €10,000. While you are not required to apply for each license separately you will have to pay for each. Thus, the wider variety of entertainment your casino provides, the more licensing-related expenses you incur. 

 Type Fee

Application fee

€5000

Renewal fee 

€5000

Technical Audit

€2500

Compliance Audit

€3500

Annual fee ( license type 1-3)

€25000

Annual fee ( license type 4)

€10000

Gambling businesses licensed and operating in Malta are required to pay 5% of their revenues ( only applies to money received from Malta residents), plus a compliance contribution varying for different license types. 

Type 1 license compliance contributions:

The minimum requirement for type 1 licensees  compliance contribution is €15,000, the maximum contribution is €375,000

Type 2 license compliance contributions:

The minimum compliance contribution for type 2 licensees is €25,000, the contribution is capped at €600,000. 

Overall, it's more costly to run a business in Malta, which suits bigger enterprises that can afford considerable financial overheads. On the other hand, a license issued by MGA grants your business more prestige and it doesn't have limitations of the Curacao license. 

CURACAO LICENSE LIMITATIONS

An important drawback of the Curacao license is the restriction it imposes on the geography of your clientele. Thus, you cannot admit in your casino players from France, USA, or the Netherlands. This regulation seriously curbs your potential target audience but its violation will lead to your license being withdrawn. Ironically, the casinos licensed in Curacao are also not allowed to let in the residents of Curacao itself. Nevertheless, despite its shortcomings, the Curacao license is one of the most popular choices among gambling entrepreneurs due to its low cost and simple application and compliance processes. 

PERILS OF RUNNING AN UNLICENSED ONLINE CASINO

It might be tempting to evade altogether an arduous and complicated licensing process but operating a gambling business without a license can eventually land you in hot water.

First, you will have difficulties working with quality software providers since most of them shun unlicensed businesses. If you are interested in providing top-notch content to your customers you are in for a rough ride. 

Similarly, a bad reputation that will stick to you can scare away potential clients. Online gamblers have a habit to check the credentials of places they visit and they tend to steer clear from shady and questionable sites where they risk losing their money. Surely, unlicensed casinos fall in this category. 

You can run into all kinds of trouble with the law; your company can be fined, closed or you yourself can end up behind bars. Case in point, the UK legislation provides for a 51 weeks prison sentence for operating a gambling business without a license. Similarly, in Germany and Russia running an unlicensed casino can land you in prison for 2 years, not to mention heavy fines your company is likely to incur. 

While licensing expenses might seem daunting the cost of ramifications of running an unlicensed gambling business is much higher. The only sensible thing you can do is to make your online casino legitimate, even if it requires substantial initial investments, thus avoiding ruining your business further down the line.