Are you a fan of online casinos? If so, you may have noticed that iGaming operators tend to gravitate towards certain parts of the world. These cities may not seem to have much in common at first glance, but operators don’t just choose their headquarters for the scenery.
Read on to learn which locales rank high on the list of iGaming hotspots, and discover why these particular places have become hubs for the booming industry.
If you play online regularly, you’ve likely ventured to a site that is licensed and regulated in Malta. Over 250 gaming companies call this island paradise home and the remote gaming sector is responsible for over 12 per cent of the country’s GDP. A combination of historical acceptance, favorable tax conditions, and a high-tech infrastructure all make it a prime choice for iGaming providers.
Even when the industry was in its infancy, Malta recognised the potential it held. The government began to create iGaming legislation nearly two decades ago and the country became the first EU member state to implement a comprehensive set of remote gaming laws back in 2004. This safe and accepting environment drew in companies from across the globe, and iGaming quickly became a celebrated part of the Maltese business world.
Along with the influx of commerce came a rock-solid international workforce. As developers, marketers, and tech experts flocked to the area, they brought innovation and new ideas along with them. The country grew into a technological wonderland, boasting a contemporary telecommunications network and even hosting events like the SiGMA iGaming Festival.
Meanwhile, the government did its best to keep up with demands. Malta streamlined the licensing process to attract even more business and kept laws allowing the corporate tax rate down to as little as five per cent. All these factors combined spelled out unequivocal success for remote gaming enterprises in Malta and today, they boast one of the largest iGaming sectors in the world.
Does this mean that Malta will remain a highly sought-after destination forever? Not necessarily. Of course, it’s worth noting that smart iGaming companies must be willing to change along with the times. Large casinos aren’t afraid of developing and branching out, and you’ll often see them moving their offices as local laws change or better business opportunities present themselves elsewhere.
This kind of mobility is a key factor in a casino’s success, as local tax breaks can mean millions to the company’s profit margin. And while Malta remains an attractive option for many operators, tax benefit plans in other locales like Gibraltar and Ceuta create their fair share of competition in the iGaming market.
Gibraltar is a British Overseas Territory located in southern Spain, although it’s more reminiscent of a balmy Mediterranean paradise than a blustery northern clime like Britain. Much like Malta, Gibraltar got in on the iGaming industry early on. When it passed the official Gambling Act in 2005 to sanction and provide structure for remote gaming operations, providers quickly noticed.
Operator interest was piqued even further as Gibraltar implemented a host of other incentives to make themselves a more attractive destination. The idea was to draw in iGaming enterprises by omitting Value Added Tax (VAT) and providing a lower tax rate for businesses to take advantage of. Gibraltar also boasts a reduced cost of living, with fewer overhead expenses for offices in the territory.
This plan certainly worked out well, as there are now over 30 operators licensed in Gibraltar. However, it must be noted that due to additional government audits and oversight, obtaining and keeping up a license in Gibraltar can be difficult for some companies. While more established enterprises rarely have issues with this, smaller companies and startups may get hindered.
It’s also important to know that regardless of a company’s size or status, it will be affected by local politics. And while operators in Malta are relaxing in political stability, those in the British territory of Gibraltar must contend with Brexit—and we don’t yet know how the situation will play out.
It’s true that the UK and Spanish governments have been working together to find solutions surrounding the issue, signing an agreement back in December 2020 stating that Gibraltar will remain in the Schengen Area. While the deal does answer questions of travel between the Spain-Gibraltar border, it is yet unknown exactly how Brexit will affect the iGaming industry in Gibraltar as a whole.
Additionally, a 2017 ruling by the European Court of Justice means that Gibraltar has recently lost some of the tax incentives that made it so desirable before. With companies now facing a higher tax rate as well as political uncertainties, many are turning towards newer hubs like Ceuta to establish operations.
So, which companies might make the switch? Established operators with years of experience under their belt have seen the potential, with veteran venues like 888 online casino already considering plans to establish offices in Ceuta. While this provider doesn’t necessarily plan on giving up the Gibraltar base and licensing they have held since 1997, we could see them and others setting up shop elsewhere as they travel wherever the winds of profit may take them.
The Spanish enclave of Ceuta is an up-and-coming iGaming destination located in northern Morocco on the Mediterranean coast. Unlike Gibraltar and Malta, Ceuta does not have a strong history in the remote gaming arena. However, the small city (along with sister enclave Melillo) caught on back in 2017 and implemented a tax break program to draw in fresh businesses to the area.
Aimed specifically at remote gaming providers, Ceuta’s enviable tax system offers reduced VAT and a 50 per cent cut when compared to the rest of Spain.
They also provide an increase in social security benefits, plus additional reductions in personal income tax. In light of this, many gaming companies wasted no time setting up headquarters there.
Now, over a dozen big-name providers call this bustling city home. Being a more recent addition to the list, it remains to be seen how exactly the chips will fall for companies in Ceuta. However, current laws show big promise for the little enclave and it’s likely more companies will consider moving there as the situation develops.
These major iGaming hotspots have everything operators could want. Favorable tax conditions and solid licensing procedures draw in many providers, while a talented employee pool and a wealth of innovation ensure their success. Of course, the warm weather and sun-drenched beaches don’t hurt either. Overall, the remote gaming sector is thriving around the Mediterranean area and we can’t wait to see what the future could hold for this rapidly-growing industry.
Disclaimer: Play responsibly. Players must be over 18. For help visit https://www.gamcare.org.uk/.
Independent journalism costs money. Support Times of Malta for the price of a coffee.