The Baltic region is undoubtedly one of the most interesting markets for operators to discover, which is proved by recent gambling news. Estonia is its prominent representative.
Sören Meius, Advisor of the Ministry of Finance of Estonia, has explained the country’s regulatory framework, the procedure of license acquisition and overviewed the market during the pandemic.
Could you provide a short overview of what is happening in the Estonian gambling industry now?
The Estonian gambling industry has enjoyed for more than 10 years a relatively stable legal environment. The number of market participants has been growing slowly but steadily. In Estonia, the lotteries are organized by a state-owned monopoly, but betting and games-of-luck (casino) are licensed to an unlimited number of privately held operators.
The market is small due to the small size of the country, and additional restrictions for players: betting is allowed from age 18, and games of luck from 21. The number of operators has been around 18 in recent years but currently has increased to 24 (23, excluding the monopoly). There is a centrally kept register of problematic gamblers (self-exclusion list). All types of gambling operators have to adhere to measures that are directed to ensure the fitness and propriety of the companies, their directors, and establishments. The reporting and declaration of taxes system are comprehensive, but done digitally, which reduces red-tape.
The supervisory, as well as the licensing authority, is the Tax and Customs Board. The Estonian Financial Intelligence Unit has also the power to request information and supervise the adherence to AML/CFT rules.
How did the pandemic influence the market?
The COVID-19 outbreak in 2020 and the second wave that hit Estonia in early 2021 have kept the brick-and-mortar establishments closed, but the remote industry, as well as lotteries, have shown a significant increase in turnover. The aggregate turnover of remote gambling has increased from 1 641 million in 2019 to 2 047 million euros in 2020, the remotely organized tournaments (poker) from 1 399 million euro in 2019 to 2 217 million euro in 2020. The drop in betting has been noticeable: from 470 million in 2019 the turnover for 2020 has come only to 258 million euros, which is comparable to the turnover of 2017 (244 million). The increase of turnover of lotteries (aggregated, including numerical lotteries and scratch cards) came to almost 17 million euro, in the years 2017-2019, the combined growth was around 5 million euros. No gambling tax was collected from the closed establishments.
Online gambling was legalized in Estonia in 2010. What changed in this sector for 11 years? Are there any upcoming gambling regulations in the country?