New Rules for Estonian Online Casinos

August 15, 2009 | News Category: Gaming Law

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Estonia has found a way to strictly regulate online casinos, while managing to follow the requirements as set out by the European Union. The new regulations will be implemented at the beginning of January of 2010.

The way that the Estonia Gambling Act will comply with the European Union's guidelines, is that even though the Act recognizes the licenses of online gaming operators which are based in other member countries of the European Union, these gambling operators based in other countries will still have to fulfill certain requirements in order to be able to operate out of Estonia.

In order to operate legal online gambling sites in Estonia, foreign gambling operators will need to apply for a license to operate within its borders. Those online casinos and other online gambling site operators who are licensed elsewhere and feel that perhaps it might not be in their best economic interests to apply for an Estonian permit to operate, will have other options available to them.

The other option available for those who do not wish to apply for an Estonian license is that they will be allowed to subcontract with already licensed Estonian gambling operators. The foreign online casinos will be able to subcontract with state licensed operators in order to keep their costs reasonable.

The type or types of gaming that are intended to be offered by online casino operators will affect the license needed in order to operate in Estonia once the new laws are passed and in effect next year. Online gaming operators will need to show that they are correctly incorporated and capitalized. Another important point is that the companies applying for licenses will need to submit themselves to background checks.

Two of the important conditions that need to be part and parcel of the online gaming site is that the sites need to have responsible gaming programs and age verification software included.

Another important point with which foreign gambling operators will need to comply is to have the servers that determine the results of the games on Estonian soil. The reason for this condition is that Estonia wishes to be able to have the servers accessible to independent auditors and regulators in order to ensure fair play.

Those online casinos that have not been licensed in Estonia, and those that have chosen not to subcontract with Estonian operators, will be blocked from operating within the borders of Estonia. Internet service providers will be required to block these operators from operating illegally. Should a payment processor be notified that a specific online casino is operating illegally, they too will be responsible for blocking money transfers to and from the illegal online gambling operator.