Estonia, although a small country, stands out among the EU countries for its active position in the gambling industry, already in 1995 the Gambling Act and the Lotteries Act were adopted. Here is created a transparent regulatory framework for the development of gambling on legal terms, fair play, and protection of customers’ rights. The gambling business in Estonia is controlled by the Estonian Tax and Customs Board (EMTA). EMTA functions include reviewing documents and issuing a Gaming License in Estonia. In its activities, the Regulator is based on the Gambling Act of 2009.

In Estonia, a gambling license and a permit for gambling activities are issued only to a legal entity. This type of license must be issued when organizing gambling activities. The following are licensed separately: games of chance, skill, and totalizators.

The Estonian gambling license mustn’t grant the right to carry out gambling activities in other EU jurisdictions.

EMTA may refuse to issue a license if it is found that: the owners or general managers have a criminal record; the license was revoked earlier; false information was provided or the legislation was not complied with.

A license is not required if: a commercial lottery with a prize fund up to EUR 1000; sports competitions; games of skill (but if the winnings are another participation in the game).

Advantages of obtaining a gambling license in Estonia

Legality and transparency of activities.
An official gambling license in Estonia from EMTA means that the activity is conducted in compliance with all regulations regarding the storage of customer data, payment of remuneration, the establishment of the same rules, and winning opportunities for all players.

Proven authority in the market.
EMTA has established one of the main criteria for reviewing the documents – verification of the reputation of the beneficiaries, and managers of the company. Obtaining a license means that the company has passed the verification of all data, and technical standards, as well as confirmation of the qualifications of top managers, and goes out.

EU banking system.
Legalization of gambling activities is the possibility of official cooperation with European banks, payment systems, service and processing centers.

Tax requirements.
There is a relatively low tax burden for companies: 5% tax on online gambling, and 20% corporate tax.

Request more info about a gambling license in Estonia

Requirements for obtaining a gambling license in Estonia

EMTA has the right to take up to 4-6 months to review an application for an Estonian gaming license online. Usually, the process takes 4 months. The decision from the Regulator comes electronically to your e-mail. The license is perpetual, but the permit must be renewed after 20 years.

Basic requirements of EMTA:

Authorized capital.
For the organization of games for luck, it is necessary to have an initial capital – of EUR 1 million, totalizators – of EUR 130 thousand, and skill games – of EUR 25 thousand. For a legal entity gambling activity should be the only type of activity. Also, non-resident companies must be registered with the Tax Authority.

Reputation.
The management and shareholders of the company must provide all personal data, information about the place of residence, and proof of work experience, as well as a mandatory condition in the absence of criminal records and mistakes in the management of previous companies leading to bankruptcy. Also negatively affects the issuance of a license if there were violations in the payment of taxes or has already been revoked a license.

Technical regulations.
EMTA requires the company to keep data on transactions for at least 400 days, servers must be located in Estonia or the EU, for data protection software must comply with S2K1T2 protocol norms.

AML/KYC procedures.
The company must comply with EU legislation against illicit enrichment.

Business Plan.
The company describes its activities for the next three years, taking into account the services to be provided.

Audit.
Every year there is an audit of the accounting records for the gambling company.

Payment of the state duty.
The application will be considered only after payment of all state fees, depending on the type of license.

How to open a gambling company in Estonia

In Estonia, only legal entities can operate in the gambling industry. A joint stock company or a limited liability company can apply for a license and permit. The main requirements for the legalization of work in the gambling market are impeccable business reputation and obtaining a license. Estonia has signed about 50 double taxation treaties. Registration of a legal entity in Estonia takes place in several stages:

  • Stage 1

Company Documentation

To register a company, you need to collect all the incorporation documents:

  • Articles of Association, Memorandum, meeting minutes, agreements
  • Identification documents of all directors and founders, data on their place of residence, and contact information. There are no residency requirements for founders and directors, but there must be at least one shareholder
  • Statement of initial capital contribution (the entire amount is deposited at once, which depends on the type of activity/gambling)
  • Legal address (can be without a physical office)
  • Stage 2

Select a name

With the help of the Electronic Commercial Register, the uniqueness of the name of the company is checked.

  • Stage 3

Applying to the electronic register

In Estonia, company registration can take place online or offline with the help of a notary. For online registration, there is a service of the Electronic Commercial Register. An application and a questionnaire are filled in, which includes all information about the beneficiaries, and managers.

  • Stage 4

Tax Service

After receiving the NACE code, where the type of activity is indicated, registration with the Tax and Customs Department takes place. Gambling companies declare profits pay taxes according to the tariff system and undergo an annual audit.

  • Stage 5

Bank account

In Estonia, to open an account, the authorized person must be present in person at the bank. The process can take up to 4 weeks. There are about 10 commercial banks in Estonia, and it is possible to open an IBAN account.

  • Stage 6

Obtaining a license

In this jurisdiction, gambling is licensed, so a package of documents is submitted to EMTA, which:

  • the reputation of shareholders and directors is confirmed, their personal data, residency, and contact information is specified
  • a list of shareholders with the percentage of ownership is provided
  • a business plan is submitted detailing activities for the next 3 years
  • AML/KYC procedures are described
  • software compliance with all technical requirements and EU standards is confirmed
  • Estonia gambling license costs are paid according to the type of activity

The process of obtaining a gambling license in Estonia

To obtain approval from EMTA it is necessary to:

  • Stage 1

Register a legal entity

A joint stock company or a limited liability company shall be chosen to conduct gambling activities. A non-resident company must be registered with the Tax Service.

  • Stage 2

Pay the authorized capital

The amount of the authorized capital depends on the type of games.

  • Stage 3

Make a business plan

The company provides a detailed business plan.

  • Stage 4

Confirming software compliance with standards

An independent assessment of software compliance for gaming activities, data security, customer identification, compliance with S2K1T2 protocol requirements, and ISKE security system is provided. Servers must be located either in the EU or Estonia.

  • Stage 5

Fee

A fee of EUR 3,200 to EUR 48,000 (depending on the type of game) is payable for the EMTA application. Once the license is approved, a license fee is charged each year.

  • Stage 6

Applying EMTA

The application to the Regulator shall include information about:

  • Applicant (all company details)

    • Type of game
    Date of payment of the license fee

    If necessary, EMTA makes inquiries to other state bodies to check the applicant’s reputation and data on payment of fees.

    After obtaining a license, it is necessary to issue a permit for gambling activities (where exactly the activity will be carried out – a website or a place).

    Types of gambling licenses in Estonia

    Estonia has developed a two-stage licensing process consisting of obtaining:

    • Activity license
    • Operating permit

    When applying for a license, the company indicates the specific type of gambling activity (online casino, sports betting). A positive decision from EMTA is possible if all requirements are met.

    After obtaining an activity license, the company applies for an activity permit. It is required for both online and offline activities.

    If the operator plans to offer different types of games, then each type of game must be licensed. For example: sports betting and card tournaments.

    Main categories of games in Estonia

    The activity license is divided into several categories with their criteria and tax rates:

    • Games of chance. The basic principle is chance, which leads to either winning or losing. For example: roulette, slot machines, and table games.
    • Lottery. Also, the basis is the randomness of winning or losing. The prize fund – up to 80% of the cost of tickets, tax -18% of sales.
    • Totalizators (sports betting). Winning depends on whether the player guessed the outcome of the game. Tax -5% of betting income.
    • Games of skill. The principle – winning depends on the dexterity, and abilities of the player. For example: chess, slot machines, and sports. Tax – EUR 31.95 per table.
    • Remote gambling. Betting is conducted online by electronic means (online casinos, roulette, poker). Tax -5% of winnings.

    Gambling consultant in Estonia

    Сonsultant

    Anastasia Angelova

    Gambling regulations in Estonia

    The Estonian Tax and Customs Board (EMTA) regulates the gambling sector. EMTA examines license applications and also monitors the activities of market participants and if a violation is detected, the license can be revoked.

    The activities of gaming market operators are regulated by:

    Taxation in Estonia

    The company submits a declaration to EMTA by the 15th of each month.

    The following taxes are provided for gambling companies:

    • Corporate tax -20%
    • Internet gambling -5%
    • From the sale of lottery tickets -18%
    • Tournaments -5% on contributions
    • Gambling machines – depends on the type of machine

    License fees in Estonia

    According to the State Fee Act of 2014, paragraph § 260, the state fee for the EMTA application is:

      1) 47,940 EUR for the organization of gambling;
      2) 3200 EUR for the organization of a game of skill;
      3) 31,960 EUR for the organization of a totalizator.

    In addition, a state fee of EUR 3,200 must be paid for a gambling permit and EUR 640 for a sweepstakes (paragraph § 261).

    Also, each operator pays a license fee per year, the amount depends on the type of activity, and type of license and varies from EUR 47,940 to EUR 190,000.

    FAQ about Estonian gambling license

    Is gambling legal in Estonia?

    Estonian legislation has regulated gambling since 1995, and the main controller of the gambling sector is EMTA.

    How to get a gambling license in Estonia?

    EMTA is authorized to issue licenses if the submitted documents meet all the requirements, and technical standards, as well as paid the state duty.

    How long does it take to obtain a gambling license in Estonia?

    EMTA issues the initial report on the submitted documents within 3 days, the final decision is made within 4-6 months.

    What is the cost of a gambling license in Estonia?

    The cost varies depending on the type of license, in addition, the state duty is paid for the review of the application and for the issuance of the permit to operate, based on the rules of the State Duty Act of 2014.

    What is the gambling tax in Estonia?

    Tax rates depend on the type of game, the number of gaming machines, and the location (online or offline) and are specified in the Gambling Tax Act.

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