For the past decade Belarus has positioned itself as a haven for the legal gambling industry. And has been very attractive to Eastern European operators. Adding iGaming to the mix by legalizing online casinos in 2019. However, constant crises. A weak currency and a rather strict regulatory regime have made it difficult to enter the market. Keep reading to learn more about the Belarusian gambling market in 2022.
Although Belarus is a small country with a population of less than 10 million people.
The initial regulation of land-based gambling in Belarus is often linked to a corresponding gambling ban in neighboring Russia. Since Russian casinos have been ordered to be located in remote, hard-to-reach gambling areas. Belarus has provided millions of Russian players with the opportunity to enjoy. The games without having to spend time and money on a long trip.
This model worked very well and the industry experienced an initial boom. But subsequent tax increases, difficult economic conditions and increasingly stringent regulations held back the development of gambling in the country.
Let’s dive into the Belarusian gambling market and see if this jurisdiction is worth. Considering as a potential investment region in 2022.
Legal provisions: Gambling Market
The industry has never been completely banned, but casinos and betting shops have been fully regulated since 2008.
On April 1, 2019, Belarus introduced the regulation of online gambling.
The state, of course, perceives iGaming as more of a continuation SilverOakCasino of the land-based industry than as an independent industry. Applicants for an online gambling license must already be holders of a land-based license and have two years of experience in the country.
This means that for a potential online operator. The only option to get up and running quickly is to partner with an existing business. A more realistic prospect than opening a completely different business and running it for two years.
But there is also good news. Including poker, slot machines, sports betting. As well as live versions of traditional games broadcast over the Internet. Both foreigners and citizens of Belarus can apply for a license.
All formal processes are priced in base units, which are a notional amount that a country uses to calculate. Pensions, fines, duties, taxes, and other payments. In 2022, the base amount is 32 Belarusian rubles or € 10.95.
To form a public limited company (which is the local equivalent of a corporation). The minimum capital must be at least €4,380 (400 base amounts). While a closed joint stock company can be €1,095 (100 base amounts). A limited liability company is the simplest and cheapest option.
Formally, the process of applying for an online license is to make changes to an existing license , for which the company requires the payment of a special fee of 250 base values (added to € 2,737.5 as of 2022).
According to the rules, the company must open two bank accounts in a Belarusian bank: a settlement bank account , which must be used for all payments to players, and a special bank account, which must have a reserve amount used to pay out winnings in case there will be no funds. For online casinos, the required reserve is 90,000 base amounts (€985,500), while for bookmakers and sweepstakes, the required amount is less – 20,000 base amounts or €219,000. The regulator will monitor quarterly whether the amount is actually present in the bank account. To operate legally in Belarus, a gambling company must use the local domain .by or its Cyrillic alternative .
Gambling Monitoring Center
The longest and most problematic stage of the licensing process is testing. The authorities will need confirmation that the platform and all of its software work exactly as specified in the documentation and that the future online business meets the standards set by the licensing authority.
The key regulator in this process is the Gambling Monitoring Center . This state institution conducts testing (specific terms and scope of testing are determined by individual agreement), and also ensures the operation of the Special Computer Cash System .
All financial transactions and players’ personal data must go through this system, and the operator must integrate with it, working closely with the Gambling Monitoring Center.
Taxes and Advertising: Gambling Market
Gambling in Belarus is subject to a special tax of 4% on net profit (deposits minus winnings), as well as income tax of 4% on winnings and returned deposits. There are other taxes that are not specific to the iGaming industry, but are mandatory for Belarusian companies. However, gambling establishments are exempt from paying VAT.
The land sector is also subject to taxes, updated in the Comments to the Law of the Republic of Belarus dated December 31, 2021 No. 141-Z “On Amendments to Laws on Taxation Issues” in the section on taxes on gambling business.
Companies pay 7,854 BYN (€2,687) for each gambling table, 264 BYN (€90) for each slot machine, 2,475 BYN (€846) for each betting cashier and 1,650 BYN (€564) for each cashier at a betting shop.
Market in recent years
The coronavirus pandemic and the protests that took place in 2020 had an extremely negative impact on the gambling industry. The land segment relies on tourism, and as the flow of people coming to the country has dwindled, so have casino and gambling hall revenues.
Online casinos have mostly suffered from frequent internet outages.
There is another side of the coin: in 2020, Belarus approved its positive position regarding cryptocurrencies; The first legal crypto-exchange opened its doors. “On the Development of the Digital Economy” in 2017, but it took time for practical implementation. Cryptocurrencies also do not need to pay taxes until 2023.
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Unfortunately for casino operators, cryptocurrency gambling market is still illegal. The digital currency is anonymous and not transparent enough, which means that it is currently incompatible with current regulations. Of course, since there is definitely a demand for cryptocurrency gambling, it is likely that regulators will find a way to include digital currencies in the terms of the license without compromising the safety of players.
In 2021, Belarus remained one of the most active gambling jurisdictions in the region.
The number of land-based casinos in gambling market the country has dropped to 20, but this is still more than in other European countries with similar populations. In a way, the multiple challenges faced by the land-based sector have accelerated the adoption of online casinos in the local market