Online casinos shutting down in Poland and Czech Republic
19 April 2017 Written by: Geraldine
Poland and the Czech Republic are just two of the European countries which have been moving towards the regulation and legislation of online gambling. A couple of years of discussing back and forth have lead up to now, where Polish gambling regulations have only been in effect since January. But ‘now’ is showing that more and more online casinos are starting to exit the local markets after only three months of operating under these new laws.
Why are all these casinos leaving the Polish market? And does this bode the same for the Czech gambling market?
What are the Polish gambling regulations?
There are many clauses and specifications to these regulations, but the biggest issues can be boiled down to two major ones:
- LOTTO brand owner Totalizator Sportowy has been given full control over games of chance provided online, thereby creating its own monopolization of games
- The Polish state is charging at 12% turnover tax for all online sports betting income
Most online casinos have complained that the Polish government has been intentionally been making economic conditions unfavorable for them. This is so that Totalizator Sportowy has more income directed towards it. The LOTTO brand owner is clearly benefiting from the situation, while other gaming company owners are suffering from the harsh regulations.
The 12% taxation was considered to be especially unfair, and when asked to amend this part of the legislation, the Polish government declined. This latter piece of news seems to have been the straw that broke the camel’s back for online gaming companies.
What has proceeded from January up until the beginning of April is that scores of online casinos have started to leave due to the Polish gambling regulations. Polish-owned ShadowBet casino had to exit the scene, along with much respected and well-known brands like William Hill, Cherry Casino group, Mr Green and bet365. And the list looks like it’s only going to keep on growing. Another Polish-owned casino, EnergyBets, has stated that it too will be leaving the Polish market soon due to the hostile conditions.
According to this article, both William Hill and bet365 have only recently decided to do this following the Polish government’s obstinacy in refusing to change the 12% turnover taxation. bet365 left end of March, and William Hill beginning of April. Things definitely don’t seem to be keeping up roses for the Polish gambling industry.
Why is this relevant to the Czech Republic?
The parallels between Poland and the Czech Republic are too obvious to ignore, even though the Polish gambling regulations h
ave had a far quicker effect. The Polish gambling regulations have been in effect since January of this year. That means they’ve only been around for about four months, and already they’re causing disastrous consequences for the Polish gambling industry.
Both countries have been in discussions regarding their legislation for ages, and both have put them into effect this January. Both have imposed heavy taxation measures. Only recently, the Czech Republic has elevated its tax rates from 28% to a huge 35% for slot machine operators. Both have a singular entity which has a lot of the power in its hands. In the case of the Czech Republic, it’s the Finance Minister.
In fact, online casinos have already started shutting down in the Czech Republic. Royal Panda is one of the more recent casinos to flee the scene, once again due to the harsh regulation environment. Who knows how many are to follow in its footsteps?