Latvia Casino License
Latvia enjoys a favorable environment for successful and enjoyable gambling activities due to its favorable tax system. If a prosperous gambling company wants to start in this country, it must first get a special state license.
In 2017, Latvia had about 6 real casinos, 320 gambling halls and 7 online casinos, with the necessary licenses. Most of all the listed facilities were located in the beautiful country's capital, Riga. According to statistics, the total profit of Latvia's gambling activities has grown in the last two years.
For example, the total income of online casinos has increased by more than € 13 million in that period. The reality of the situation in the Latvian gambling world is not as rosy as it may seem. The reason is numerous pitfalls that hide while obtaining the license.
The last 20 years
Latvia was part of the Soviet Union long ago, where gambling was strictly prohibited. The only form of gambling allowed was the state lottery. The same situation occurred in all countries belonging to the USSR. Everything changed when Latvia became an independent country.
The first Latvian casino appeared in 1990. All gambling activities have required a license since the very beginning of gambling history in Latvia. The problem with early licensing was related to the lack of a set procedure. Because different licensing organizations had their own licensing procedures.
It was only in 1994 that Latvia passed strict legislation on lotteries and gambling activities. The new rules describe the algorithm of receiving the state license and paying taxes.
What you need to know
Since then, the global gambling industry has changed a lot, along with changes in the corresponding legislation. Some rules and regulations regarding casinos have been tightened up severely. Online operators without licenses were banned. The presence of foreign companies was strictly limited.
Today it is not difficult to get a state license for gambling activities in Latvia, but if a company wants to participate in it, it should certainly know some interesting and important nuances that go into applying for and obtaining the license.
The process of the application
The same procedures apply to casinos, gambling halls and bookmakers in Latvia to obtain the license. The whole process is divided into 2 stages. The first presupposes submitting a pre-proposal to the special Supervision Inspectorate. This phase is not free. This is actually quite expensive, because the associated fee is € 427.000. But this amount is not the last amount of expenditure that a company will have to incur.
A company will also have to pay for a number of additional permits. Compared to other options, the license is quite easy to get. But the duration of the license is very short - only one year. When this period has passed, the whole procedure must be repeated again.
Cost of a license
To be licensed by Latvia, a company must have a share capital of approximately € 1,4 million. 51% of this must be owned by Latvian shareholders. This is a tricky issue for the EU. This is because there is normally free movement of services in the EU and this condition is an obstacle here.
As mentioned, such a Latvian license costs € 420.000 and an extension fee of no less than € 35.000 is also used. The license is valid for 1 year and this fee must therefore be paid every year.
Furthermore, Latvia works with a tax on the gross results, also known as the Gross Gaming Revenue of 5%. These are quite high amounts when you look at the population.
Limitations
Never forget that the citizenship of the founder of the company is of great importance to the regulatory authorities that grant licenses. The legislation assumes that at least 50 percent of the company's management must be Latvian citizens.
In addition, they always inspect the equipment before the appropriate authorities issue a license to online casino operators. Of course, this also involves additional costs.
There is another innovation that makes obtaining the license more complicated. The companies cannot locate the mainland casinos in the historic center of Riga, except in XNUMX-star and XNUMX-star hotels. Some casino operators often take their chances because of this innovation, as it can significantly reduce their revenues.
