For a long time now, Curacao has been something of a safe haven for online gambling operators looking to access exciting and profitable markets, without needing the necessary licensing to attract new players.
But that looks set to change after the territory received a financial rescue package from the government of the Netherlands, who in turn want stricter online gambling rules to be imposed.
Under the terms of the agreement, Curacao – an island in the Caribbean that is a constituent country of the ‘Kingdom of Netherlands’ – will implement a more robust licensing system, which would leave operators needing to pay greater license fees and taxes in order to be granted approval.
Perhaps more pertinently, players will no longer be accepted from other territories apart from those which accept licenses from the Curacao authorities. This has been a major issue in the past, with thousands of betting sites turning to the Curacao licensing operation so that they can offer their services to players in jurisdictions they aren’t otherwise authorised to operate in. That includes the Netherlands, who are expected to unveil a revamp of their own gambling laws in 2021.
The Netherlands had previously provided a financial rescue package to the island to aid its bid to manage the coronavirus pandemic, and a second bailout has been provided – albeit with the new obligations, confirmed in a new statute called Landspakket, outlined above.
As of March 1, 2021, Curacao will have to have a new independent regulatory body in place that is responsible for online gambling – specifically in approving (or otherwise) licence applications, and ensuring that brands aren’t targeting potential customers in unauthorised territories. The body will also have the power to revoke the licenses of firms not operating under the terms of the new agreement.
You may be wondering why so may gambling operators turn to Curacao when they need a licence.
The answer is pretty straightforward: because it is much easier to attain a licence here than from a more stringent regulator like the UK Gambling Commission or the Malta Gaming Authority.
A Curacao licence enables gambling firms to target jurisdictions like the USA and parts of Europe, all while benefitting from low costs, soft regulation and 0% paid on corporate revenue. Appealing conditions indeed!
There’s only one licence required across the board too, so a single operator can offer casino games, sports betting, poker and other channels with just one green light from the regulator.
That’s why many grey market brands, i.e. those happy to circumnavigate the law in order to attract new business, seek out approval from Curacao to access players from the United States and beyond.
How Will the Industry Be Affected?
It’s great news for online casino players that regulation will be tightened in Curacao.
Okay, so you may lose access to some of the sites you frequent, depending on your jurisdiction, but the overall result is that a more rigorous licensing system will drive up standards in the industry – no longer will inept operators be able to slide through the backdoor with a Curacao licence.
It will presumably affect the locations which brands will target. Under the changes, some operators who offer gambling in the United States or the Netherlands will have to apply for a new licence, stop accepting players from jurisdictions they are not authorised in or run the risk of operating without a licence.
It’s a decision that will have implications elsewhere too. Just recently we reported that Macau was considering opening up online casino gaming after revenue from their land-based properties dried up, however it is unlikely they would be able to target overseas players without a licence from a recognised authority.
GVC Holdings, one of the UK’s leading gambling powerhouses, have already confirmed that they will exit all non-regulated markets by the end of 2021, and we would expect many other firms to follow their lead in an attempt to drive up standards within the industry.
Where Can a Curacao Licence Currently Be Used?
Until the changes to how Curacao issues licences are ratified and brought into power, the operators acting under their licensing agreement will enjoy their last few months of freedom.
It is incredible as to how many jurisdictions such brands can target without an official licence from that country, and amazing to think how long this ‘loophole’ has been in existence.
A casino brand with a Curacao licence can target players in any country where gambling isn’t expressly prohibited, such as China, Singapore and Turkey.
That opens the door to many existing and emerging markets around the world, and offshore companies can particularly tackle countries where the law on online gambling is soft or, at worst, not really set in stone, such as India.
It’s a workaround that looks set to be closed in the coming months, and the gambling industry might just be better off for that.