Despite online gaming already legal in Romania, the sector has effectively been in limbo since no regulatory authority was established to license operators. The government is now set to put into motion new legislation that aims at opening up the market to international operators.
Following requests from the European Commission, the Romanian government is now ready to abandon the restrictive measures it had previously adopted. A new framework on remote gambling was applied to the Government Emergency Ordinance, which was approved by Parliament right before the end of 2014. It aims at regulating unlicensed operators and comes into force February 13, 2015.
The regulation outlines the taxes payable by online operators, payment methods, and other aspects related to collection of proceeds from players. Operators will also be obliged to contribute finance to activities intended to prevent gambling addiction and the participation of minors and the vulnerable, by creating a Foundation based on the European Committee for Standardisation.
New tax rates are applied under a three-tier system, with a 1pc tax for all players that generate revenues between €133 and €15,000, 16pc tax on revenues between €15,000 and €100,000 and 25pc tax on revenues over €100,000. This new system aims to promote online gambling throughout the country, which has been climbing out of debt through an International Monetary Fund-led rescue.
Prime Minister Victor Ponta has been scrambling to find the ways of reducing the budget gap and sees regulated online gaming and a new way to create revenue. Romania’s land-based gaming business is estimated at €800m (US$190m) and generated €150m (US$170m) of tax revenues last year, representing 0.1pc of total output in the economy, according to the Romanian gaming regulator ONJN (Oficiul Naţional pentru Jocuri de Noroc).
“We estimate that online gaming will bring in 100 million euros in direct taxes in 2015,” commented Cristinela Nistor, who head’s up the ONJN, adding that the new legislation “aims to increase public revenue and stimulate the market, and at the same time harmonise Romanian legislation with European norms.”
Once the new legislation comes into effect next month, a National Gambling Office and Gambling Licensing Commission will then be established. While the process and technical requirements still need to be specified, it is likely the Commission will then put licenses out for tender within a short timeframe, as the Government is eager to issue licenses and move forward with a regulated sector.
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