The gambling industry has been on the rise with many folks try to make quick cash as they entertain themselves. The flexibility and convenience of online betting have been a major contributor to the growth of this giant industry worldwide.
A closer look into the figures relating to gambling shows stunning observation in profit earned in the industry. In 2005 for example, the United States had gross revenue of $31.85 billion from the casinos. The profits in the gambling industry are much higher than any other business in the Us. So, this article aims at giving a clear and precise guideline towards getting a gambling business license if you are keen on making the big money.
A gambling license is a certificate issued by a licensing authority in a specific state to enable an organization to offer any type of game of chance or even those including wagering, for example, roulette, poker, and slots. Usually, before this certificate is issued, there are basic mandatory requirements that the company, like those you for example see on GamblingGuy, seeking it must meet.
These requirements vary from one jurisdiction to another. Normally, each jurisdiction has a regulatory arm that monitors the gambling industry in its borders and has the power to grant or denies licenses. When choosing a jurisdiction to operate in, one must consider the following: reputation, licensing procedures, and requirements, how long will the process take and the costs and taxes associated with the jurisdiction.
Rules and Regulations
The rules and regulations are normally drafted by the gambling control board of a state mostly to ensure that the company has in place policies which prevent gambling addiction. These rules cover how the interested company would operate, its accounting and auditing plans, types of games to be offered, and finally conduct of all the people involved within the company: this is true for the employees as well as the employer.
These guidelines are further elaborated below:
Business Disclosures: Most states would require that a business applying for a gambling license do a rigorous process of disclosure opening up on every aspect of their business enterprise. It must disclose all assets, audits, accounts payable, and evidence of their company’s financial wealth and legal status; it must further give all information regarding any business associates in terms of partnership or franchise. This process is long and exhausting, especially for larger companies with branches globally.
Personnel Disclosure: The authority board may require that every officer and the directors of the company disclose all their financial details including where they reside, their former employer, if they have ever been charged for any criminal activities, other boards they serve on, and all assets and liability they have. Although these details are usually kept confidential, they are mostly deemed to be lengthy and annoying by most applicants. The ultimate goal of the state however is, to make sure the rights and safety of its customers have well protected especially the money.
Game Testing: The company must also provide a clear description of all the games sit intend to offer, game specifications, and system functionality. The state will then conduct testing on the games for approval majorly checking on the reliability and integrity of the games.
Fees Chargeable in the licensing process
The fees payable differ across the countries. Basically, the license fee falls under three categories:
- The application process
- The license
- The operation compliance.
The application process
This involves the legal or the advisory bill and legal disclosure. Here it is advisable you seek the services of a professional lawyer to hasten the process.
The amount charged for an operational license depends only on the attitude of the particular state towards gambling as a whole. If the state is against gambling and betting, it usually tends to charge a high fee so as to discourage companies from such undertakings. Jurisdiction with favorable gambling licenses includes:
Curacao: It is located in the Netherlands and it is under the watch of the Curacao Gaming Control Board. its license is ideal due to the mix of low cost and time frame.
Malta: It is the first European Union nation to introduce the regulations of remote gambling licenses. Malta is also the preferred choice for most sites for many reasons.
Alderney: In 2005, a free-market approach towards online gambling was introduced by the Alderney Commission and since then, any online casino with a license of this state can operate at the international level.
The United Kingdom charges a low fee but 15% on tax revenues. Italy charges 300K euros for a 10-year license plus 70K annually and a further 20% on revenues.
These may include recurrent costs such as on reports required by the regulating body, inspection costs, and ongoing certifications mostly on new games that might be added as the company is in operations. By making fees high and process exhaustive, the state has prevented manipulation of the industry and succeeded in protecting consumers from the greed of unscrupulous businessmen. This enforcement is put in place to protect the gammers and also keep and maintain high standards of quality and transparency in the industry.
In conclusion, the easiest way of obtaining a license is by determining what legal framework dominates within a particular jurisdiction. They are broadly categorized as below: states that regulate gambling within their boundaries, state that monitors and impose monopolies within its territories, countries that ban gambling in totality, and countries that lack regulations on betting activities.
Some frequently asked questions about gambling licenses:
Why is gaming license important?
Licenses are evidence that the casino is operating legally and renders the casino trustworthy in its behavior and commitment towards fair gambling policy. it’s also a sign of transparency for the company and that the customer’s interest is well prioritized.
Can anyone start a gambling business?
Yes, anyone with enough capital can open a casino. The steps in setting up a casino are:
a. Make sure casinos are legal in the state you choose to operate. There are different regulations depending on the country of choice as discussed above.
- Have a solid business plan and follow it through.
- Register your casino with your jurisdiction of choice.
- Apply for a gaming license.
What are some of the challenges in the gambling industry?
The challenges in gambling business include frequent change in technology as new software keeps emerging so been ahead of the trend can be a difficult task, change in regulations, and player acquisition and retention.
Corporate Social Responsibility and Gambling
The gambling industry is here and has taken over. It keeps getting big and better. However, an eminent measure has to be put to cushion players from becoming addicted. The only aspect of CSR that remains to be unique to the gambling industry is Responsible Gaming. Responsible Gaming involves a set of voluntary regulations and policies put in place to protect players from the possible negative aspect of addiction. It addresses the following:
- Protection of vulnerable gamblers
- Preventing underage betting: The companies should ensure that no underage person is allowed to bet either online or offline.
- Information protection: The information that the betting company has should always be protected and kept secure.
- Online payment protection
- Ethical marketing