Romanian Gambling Industry in Good Shape

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Tuesday, March 29th, 2016 | Written by Charles Washington

When you think of gambling hot spots around the globe, Romania is unlikely to spring first to mind, but in actual fact, there is a vibrant gambling industry thriving in the Eastern European nation. Recent reports from the Romanian government show that online and brick and mortar gambling operators are serving as a valuable source of income for the country of almost 20 million people, having generated more than €1 billion in revenues last year.

Business Is Booming

The National Gambling Office of Romania is the body responsible for issuing licenses and enforcing the regulations that govern the country’s gambling industry. In early March, the office released a report, showing just how well gambling businesses are faring in the nation. In 2015, gambling operations brought in €269 million in tax revenue, higher by 71 percent compared to the €157 million in tax revenues collected in 2014.

All in all, there are 488 gambling operators running brick and mortar businesses in Romania and 19 online operators. Last year, the country also made €70 million in licensing fees.

A Look at Romanian Gambling Laws

What’s driving the increase in tax revenues in Romania? You only need to look back at what happened in 2015. Last year, Romania issued a brand new set of laws regarding gambling licensing that made the country a much more attractive place for operators to do business. Some of the features of the law include:

– Residency Requirements. Operators must either be legal Romanian residents or residents of the European Union or the European Economic Area to qualify for a license.

– Long Licensing Periods. Once issued, licenses are good for 10 years; however, they are not transferable.

– Temporary License Options. Operators who only wish to provide gaming online or at a brick-and-mortar business can get a temporary license that is good for just 3 months.

– Payout Requirements. Romanian law requires operators to provide payouts equal to a certain percentage of their profits to ensure fairness. Stakes and limits must be clearly displayed on all games and on websites.

Enforcing Regulations

While Romania has worked hard to make their regulations friendly to gambling operators wishing to abide by the law, the country is taking steps to crackdown on illegal gambling operations. The National Gaming office issued a list of 500 illegal online operators that were accepting bets from Romanian citizens back in 2015. This so-called blacklist was distributed to Internet service providers in Romania who were forced to block all access to these sites. The government is continuing to update the list to prevent illegal operators from getting a foothold in the country.

For land-based casinos, the National Gaming Office uses an information system to monitor payouts and slot machine activities for irregularities. There are steep fines in place for operators who fail to comply with regulations, and for those who attempt to operate without a license.

Smoking Ban

It seems that Romania has made the right choices when it comes to regulation to protect consumers while still encouraging gambling operators to do business in their country to benefit the nation’s budget and allow Romanians the freedom to gamble. On March 16th, Romania subsequently became the 18th European Union country to introduce a blanket smoking ban in public, with harsh penalties awaiting anyone who violates the law.

The law obviously applies also to the country’s casinos, which has raised major concerns amongst these gambling venues as over a quarter of all adult Romanians smoke. As a result, casinos are worried people will now spend less time at the gambling tables, and as Violeta Radoi, executive director of the country’s slot operators’ association (ROMSLOT), explains:

“European experience has shown that in other countries, banning smoking in the halls of game had serious repercussions on revenue of operators, which have fallen by 30 to 40 percent, although the law was not as tough as in our case.”

Consequently, ROMSLOT is currently calling out for the government to follow the lead of other EU countries such as Sweden, Italy, Belgium and Austria in making allowances for smoking inside casinos. Presently, just Romanian airports and prison permit smoking in selected areas.