Online casinos need an electronic gaming license to serve legally. When visiting sites like GGBet, look at the bottom of the homepage – you will see the license information here. These licenses are like “permits” that show that the casino is audited, operates legally, and is accountable. For a safe, fair, and enjoyable gambling experience, we always recommend you to play at licensed casinos and betting sites. So, which institutions provide these licenses, and what are their types? What does a casino or betting site need to do to obtain a license? Below, we answer all these questions.
The United Kingdom Gambling Commission
Established in accordance with the National Gambling Act 2005, this commission regulates both online gambling operators and the National Lottery in the United Kingdom. If you want to be able to accept UK citizens on your casino site, you must obtain this license. Casino operators not licensed by The United Kingdom Gambling Commission (UKGC) have difficulty receiving and sending payments to and from the UK. Moreover, severe penal sanctions are imposed on operators working in this way. To obtain a UKGC license, your website servers and company must be located in the United Kingdom. In addition, you pay between 2,640 – 57,304 GBP for the license application.
If your application is accepted after a long and thorough review process, you pay an annual fee of 2,709 to 512,083 GBP each year, and you are also subject to income tax. Application fees and annual fees are determined by how much income you make. Those who make 1 billion GBP and above pay the highest fees.
UKGC licenses are divided into many different categories depending on whether the service offered is land-based or online. In general, there are two basic categories: non-remote and remote. Non-remote licenses are used by physical casinos and bookmakers. Remote ones are divided into two categories: “host” and “remote”. Host licenses are given to operators who develop their own games and only offer them through their own website -these are cheaper. Remote casino licenses are given to classic online casinos that offer games from different suppliers through their own websites. UKGC is currently considered the most prestigious license in the iGaming industry.
Malta Gaming Authority
Malta Gaming Authority (MGA) was established in 2001 and has more liberal license terms compared to UKGC. Holders of this license can accept players from different countries and do not have to host their servers in Malta: only the company headquarters must be located in this country. MGA licensed casinos have the right to accept members from all European countries, except countries that have their own licensing system and/or prohibit gambling. MGA has two license types: “gaming service” and “critical gaming supply”. The second is only given to B2B companies (meaning you cannot run a casino using it). The first is the license given to online casino sites and is divided into four categories: Type 1, Type 2, Type 3, and Type 4.
- Type 1: Remote gambling license issued to online casinos.
- Type 2: License given to online betting sites.
- Type 3: License granted to online casino and betting networks (e.g. poker network, bingo network).
- Type 4: License to host and manage remote gaming operators.
Online casinos, predictably, prefer the Type 1 permit. The application fee for it is 15.000 EUR. In addition, an annual fee of 375,000 EUR is required each year. Depending on the license type, these fees can increase up to 600,000 EUR. In addition to all these, you have to pay a certain amount of commission from the income you make each month: 4% per month until you earn 3,000,000 EUR in total. However, operators hardly pay any taxes.
Alderney Gambling Control Commission (AGCC)
Alderney has been issuing licenses since the early 2000s and is technically part of The United Kingdom. This is an island measuring just 7.8 kilometers, and gambling licenses are one of the biggest sources of income. It is enough to have your company address in Alderney to obtain an AGCC license. This can just be a P.O. Box address: you don’t need to physically host anything on the island. There are two license types, B2C (category 1) and B2B (category 2). Online casinos get a B2C license. The application fee and the annual fee for the first year are only 35,000 GBP. After that, you continue to pay an annual fee of between 50,000 GBP and 450,000 GBP depending on your income.