As the Netherlands advances its online gaming market, one company wants to make sure it doesn’t pay the price for its affiliates’ actions. Online bingo site Tombola is going to require affiliates to complete a compliance check.
Tombola, just acquired by Flutter, wants all affiliates to undergo a compliance check before the contract is signed. It will send the companies to XY Legal Solutions BV, which will be responsible for reviewing the company.
The cost will be incurred by the affiliate and runs €1125 (US$1,271) per website. If there are other legal companies serving the Dutch community that can do it cheaper, the company is out of luck. XY Legal is the only legal firm Tombola is going to allow.
This is a first for the iGaming industry in the Netherlands, but likely isn’t the last. Gaming operators want to protect themselves from the actions of their affiliates and don’t want to pay penalties for their actions. However, Tombola’s solution may not be the most appropriate, some observers say.
Affiliate Responsibility Increases
Once an affiliate shows interest in working with Tombola, it will then reach out to XY Legal to complete the compliance check. Once approved, the law firm will give its “KVA” seal approval, indicating that the company meets all necessary requirements.
The seal of approval is good for one year. After that, if the affiliate wants to continue working with Tombola, it will have to contact XY Legal again for a new compliance check. That one will cost €725 (US$819) per website.
According to Marc Smit, Tombola’s Country Manager in the Netherlands, “We do indeed set the KVA seal of approval as a condition for starting an affiliate program at Tombola. We believe that an affiliate partner should be tested.”
The seal of approval doesn’t mean that the affiliate meets the requirements of the Kansspelautoriteit (KSA), the Dutch gaming regulator. That entity has its own requirements and procedures. The KSA won’t accredit XY Legal’s seal of approval, either, nor will it likely recognize it in the future.
The KVA seal only goes so far. According to XY Legal, the compliance check is “not quantitative” and only checks certain aspects of the affiliate site.
Some Would-Be Affiliates Likely to Balk
The idea of requiring a compliance check seems solid on its face. It’s a way for companies to add an additional level of protection to their operations. However, not everyone is convinced the idea is sustainable. Jan Westerhoff, an iGaming specialist in the Netherlands, says the cost may be too high for many companies.
Westerhoff wrote in a blog piece on the Nieuwslog website: “Tombola is the only provider with a Dutch KSA license that imposes this requirement. All other operators on the Dutch market, such as bet365 and Betcity, do their own compliance checks, and those companies do not charge affiliates for this.”
He added that the cost could reach into the “tens of thousands of euros,” which may prove to be too expensive. As a result, the “only winners would be the money-grabbing consultants who want to make a quick buck.”
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