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Cypriot betting sites are making a comeback due to recent changes in the law. Cyprus once served as an online gambling hub that licensed international betting sites, but did away with all that with anti-gambling legislation passed in 2012. The country stopped issuing licenses for a period, but that has changed since the passage of new laws that came into effect in 2016.
During a one-month period in late 2016, Cyprus held a licensing period during which international betting sites were able to apply for licenses. The National Betting Authority ultimately awarded only a few licenses to date. Most international betting sites have not yet applied for a license in Cyprus.
Best Cyprus Betting Sites
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There remain laws on the books that could in theory put people behind bars for placing bets with unlicensed bookmakers. The good news is these laws appear unenforceable as can be evidenced by Cypriots visiting unregulated online casinos for years without any legal trouble. The risk isn’t zero, but it’s pretty close.
In any case, that should no longer be an issue once Cyprus finalizes its licensing system. Some betting websites are actually authorized to accept wagers as of today. The Cyprus betting sites that we recommend above have all been granted to accept real money wagers and can be considered fully legal.
Where to Bet Online in Cyprus
If you’re tired of Greek-controlled OPAP and its paltry selection of lottery-style games, you’re going to have to take your business to offshore gaming sites. The sites recommended above are all licensed by Cypriot authorities and can be considered safe places to play.
Greek and Turkish aren’t particularly catered-to in online gambling due to the restrictive gaming laws in both of those countries. Even so, some sites do offer their services in both languages, with Greek being slightly more common.
The biggest challenge you’ll face is getting around government internet censorship. A blacklist of more than 2,500 websites is blocked by local internet service providers. If you are intent on playing at an unlicensed provider, the best way to get around the block is to purchase a VPN subscription. Basically, a VPN creates an encrypted connection between you and each website you visit, thereby preventing prying eyes from watching what you’re doing and evading censorship measures.
Is it Legal to Bet Online in Cyprus?
Cyprus does allow online betting, but only with licensed providers. It is unclear if the law targets individual gamblers, but the law does clearly state that it is illegal for companies to accept wagers from the public without the proper license.
The laws of Cyprus could possibly be applied to individual gamblers, but this has never happened. You’ll find the occasional news story of Cyprus authorities raiding underground gambling dens and breaking up poker games, but there are no stories of individuals being busted for gambling.
Even in cases where authorities break up unlicensed betting shops, they go after the operators and not the customers. It would be a stretch to imagine the authorities actively monitoring the internet to bust people for betting at offshore gambling sites.
Gambling Laws in Cyprus
To make sense of the gambling laws in Cyprus, we must first talk about the political situation there. The island is essentially divided into two different nations. One of these is the southern, Greek-controlled side of the island called the Republic of Cyprus. The Republic of Cyprus considers itself the legitimate government of the entire island. Every nation except Turkey recognizes the Republic of Cyprus as the rightful government of the whole island.
The northern side of the island is controlled by Turkish people and the country of Turkey. This side of the island considers itself an independent nation called the Turkish Republic of Northern Cyprus. Turkey is the only outside nation that recognizes this as a legitimate, sovereign nation.
The gaming laws that I describe here are put forth by the Republic of Cyprus (the south side). They apply to the entire island on paper, but in practice really only apply to the south side of the island. The northern side of the island marches to the beat of a different drum.
Nowhere is this situation more clearly depicted than in the brick-and-mortar gambling industry. The Republic has a longstanding ban on gambling and does not allow the operation of physical casinos. This is supposed to apply to the entire island but again, that’s just on paper. The northern side has at least 20 casinos.
The brick-and-mortar casino industry in the north has been doing well for itself. Southerners head north all the time to gamble in addition to tourists from Turkey and Europe. The south is discussing legislation to open its own competing casinos. A legal framework was discussed in 2014 with the hopes of establishing the first southern casino in Cyprus some time in 2015.
Betting Law of 2012
Online gambling in Cyprus is regulated by the Betting Law of 2012. Before the Law was passed, online gambling was widespread in the nation. Cyprus served as a popular licensing jurisdiction for years. Some of the biggest betting websites that we still know today were licensed in Cyprus at one point.
That all came to an end in 2012 with the passage of the Betting Law. The Law immediately banned all forms of internet gambling except for fixed-odds sports betting and the national lottery operated by OPAP. OPAP was the monopoly provider in Greece and now enjoys similar status in Cyprus. Updates to the law in 2016 finally opened the market to competition from foreign betting websites.
Online bookmakers are allowed to offer their services in Cyprus as long as they obtain a license and authorization to do so. Licensed sports betting sites must operate on a .com.cy domain and are subject to a variety of taxes and regulations. The expense and difficulty in getting a license combined with the relatively small population has led most sites to not get a license.
Some betting sites opted to block all customers from Cyprus in order to comply with the nation’s laws. Other sites continue to accept customers from Cyprus despite not having a license. The Betting Act promises punishments of up to 5 years in prison and a €300,000 fine for anyone offering bookmaking services without a license, but it has no ability to enforce such punishments for gambling sites based overseas in other nations.
The Betting Law also includes punishments for people who place bets with unlicensed Cypriot betting websites. Anyone found placing bets “contrary to any of the provisions of present law” may be imprisoned for up to a year and fined up to €50,000. Fortunately, it appears this law is completely unenforced.
To top it all off, Cyprus also implements web censorship to block access to offshore gaming sites. At last word, the government had a blacklist of more than 2,500 websites that ISPs are required to block. ISPs that don’t comply face fines of €30,000 per offense.
In summary, online casinos and poker sites are illegal, online sports betting requires a costly license and few companies are willing to obtain that license. Cyprus will need to update its laws if it wants to compete with the rest of the European Union for gambling euros. And right now, Cyprus needs every euro it can get.
2016 Update: Licensing Betting Sites in Cyprus
Whereas the 2012 law was a terrible thing for betting online in Cyprus, updates to the law in 2016 paint a much more optimistic picture. The National Betting Authority began issuing provisional licenses in anticipation of fully implementing new online gaming laws. Most recently, the National Betting Authority held a one-month licensing window running from 3 October to 3 November 2016 during which operators could apply for licenses.
Any betting sites that failed to apply for a license during that time had their names added to the ISP blocking blacklist. At last count, the list prevented citizens from accessing more than 2,500 unlicensed gambling websites. Eight operators applied and have been granted provisional licenses:
- Betfair.com
- Betonalfaonline.com
- Meridianbet.com
- Winmasters.com
- Sportingbet.com
- Stoiximan.gr
- Ubet.eu
The current licensing conditions require prospective licensees to have paid up share capital of at least €500,000 and pay a licensing fee of €30,000 for one year or €45,000 for two years. Furthermore, licensed operators pay a combined total of 13% in taxes. It’s a bit of an expensive proposition for a country with a fairly small population, but eight operators have so far deemed it to be worthwhile.
After the licensing period ended, the National Betting Authority announced that it would be adding 2,500 unlicensed gambling operators to the internet blacklist. Most of the named sites are involved in casino gambling, which is expressly illegal under Cypriot gaming laws. The list now contains a mixture of unlicensed sports betting sites, online casinos and poker sites.
The iGaming industry is not just big, but it is still continuously growing. Yearly statistics show that the revenues are climbing, inspiring widespread confidence that profits will remain healthy into the foreseeable future despite hurdles and problems like pandemics and economic instability. As a form of entertainment that has long enjoyed unflagging demand, online casinos and sportsbooks will always provide a worthwhile investment opportunity. It is also easy and effortless for the majority of the consumers given the fact that technology is constantly evolving requiring minimum effort by them.
Curacao E-Gaming License
The Curacao e-gaming license is one of the world's most popular e-gaming licenses. Due to its popularity, there are approximately four hundred fifty (450) online gambling operators licensed and operating within the jurisdiction. Back in 1993, Curacao created some of the first legislation in the world regulating the online gambling market. Three years later, in 1996, the government created the Gaming License Authority responsible for issuing the relevant licenses as well as supervising and monitoring the industry. By 2001, the Curacao Interest Gaming Association was created to ensure that all gaming operators were in line with the regulatory framework and the code of conduct.
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Benefits of Curacao Gaming License
A primary question before perusing the Curacao gaming license is what are the benefits of having a gaming license in general. Firstly, it provides security since operators can operate their business without having to worry about any legal repercussions. Unlicensed casinos can be subject to heavy fines, especially if they are registered in a jurisdiction that regulates gambling. There is even a chance that the operators' representatives could spend time in prison. Eventually, the casino could get shut down by the authorities if it does not comply with the regulations of the jurisdiction where the company is seated. Secondly, it is easier to operate because most financial institutions require a license to be eligible to open an account with them. Also, a gaming license provides credibility and boosts a good reputation it grants the casino a significant amount of legitimacy in the players' eyes and contributes to the iGaming ecosystem, fighting stigmas and helping to create a just, trustworthy and transparent gaming industry. Finally, a license makes any online casino operations more appealing for software and payment service providers, many of whom refuse to cooperate with operators who do not have a license.
Attempting to run an online casino business without the proper license exposes the operators to a number of complicated and serious problems. Some operators decide that the costs of licensing and taxes are too high and seek to save money by operating without a license. However, while this may save some money in the short term, the costs of the consequences are far higher than any fees and taxes. In short, online casino licenses may present a significant up-front cost, but the financial effects of any fines and prison time will outweigh them in the long run.
Beyond the advantages of having a license in general, what makes specifically the Curacao gaming license so special?
Certainly, there are many benefits for the holder relating to the operation including corporate and fiscal incentives. Firstly, Curacao is perhaps the quickest, less-expensive, easiest and most accessible jurisdiction to get a gaming license from. It has a straightforward process plus an easy maintenance and it provides entrepreneurs with a great favorable opportunity to test their concept before tackling tougher licensing jurisdictions. There are still requirements that need to be met, but the amount of bureaucracy is limited and precious time is being saved. It also offers one license, regardless of the game type. Some of the activities that are covered by this license among others are:
- online casino games (roulette, blackjack, slots);
- sports betting peer to peer games (poker, backgammon, mah-jong);
- mobile phone games, betting;
- live dealing;
- bingo;
- fantasy football;
- various trading activity;
- pari-mutual and pool betting;
- network gaming;
- lotteries; and
However, the Curacao license strictly prohibits among others the following countries: Aruba, Bonaire, Curacao, France, Netherlands, Saba, Statia, St. Maarten, Singapore and USA.
Tax and other Incentives
One of the most significant and noteworthy advantages of obtaining a gaming license in Curacao is the low tax incentive. Τhe government of Curacao charges only 2% of the tax from the net profits of the online gambling businesses as well as 0% corporate income tax. This rate of tax is significantly lower than in many other jurisdictions and they do not create massive barriers for new iGaming industry entrants. There is also no sales tax, import duties, no tax on gross bets and no restrictions on the withdrawal of dividends. All income must be foreign sourced to benefit from the fiscal incentive and any applicable economic substance and or permanent establishment rules must be met. Despite being labelled as a “tax haven”, Curacao complies with the EU Code of Conduct against harmful tax practices. It is also a qualified intermediary from the IRS, an OECD jurisdiction, enforces CTF and AML compliance, and is a member of the Caribbean Financial Action Task Force on Money Laundering.
Furthermore, it allows the company obtaining the license to test the concept, get a license base and reinvest funds without having to pay a fortune in costly applications, taxes and fees. In other words, it supports holistic growth and allows the company to diversify into other markers segments, games and areas without taking a financial hit. All these benefits, combined with Curacao's strong financial service sector, well-developed telecommunications infrastructure and economic stability makes it the winning jurisdiction for iGaming startups from all over the world. It is also the home of several international, well-established gaming companies that have been operating there for many years, something which reflects that operations are stable.
EU-Cyprus Payment Processing Agent
Over the years, it has become very difficult for offshore companies in Curacao to accept online payments, due to the ongoing regulatory scrutiny and their consideration as ‘high risk'. Any operation will be limited by its ability to accept payments in some jurisdictions. Payment service providers often block card payments from jurisdictions where a local license is required. Given the fact that you need to accept payments on your website before people can start using these services, a payment processing agent is definitely required. A processing agent is a company that is part of the structure which processes payments for the website offering the online gaming services and receives a fee to satisfy any tax rules. The best jurisdiction to process with the incorporation of a processing agent, ideally should have a low tax rate and be eligible for access to a variety of credit-card payment providers. Considering the increased difficulties for Curacao entities to obtain bank account and/or merchant accounts in Europe, creating a structure which involves the Curacao company (which has the license to operate online gaming) and the payment processing agent (preferably an EU- Cyprus company) creates a powerful and strong foundation for the company's operations.
Our team will assist you to identify and set up the most suitable corporate structure, adjusted to your personal needs. We have a great experience in such activities and we can provide all the corporate vehicles and required licenses to effectively implement such structure. We also have a wide network of banks and payment processors and we will assist you with bank and merchant account opening.
Originally Published by Oxford Management, February 2021
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.