Cyprus National Betting Authority - New Developments




Legislation

Cyprus Betting was originally authorised under The Betting Law of 2012 (L.106(I)/2012) (this Law has been repealed) and now under The Betting Law of 2019 (L.37(I)/2019) and very soon the law will be amended and repealed again.

It is evident that Cyprus regulations are evolving to accommodate the ever-growing market of gaming by being completely transparent, reliable, compliant and promoting social responsibility and responsible gaming whilst not undermining the necessity of business and innovation.

All operators are also expected to follow any and all directives issued by the National Betting Authority as well as any applicable Anti-Money Laundering law in force in Cyprus and amended from time to time.


Authority

Cyprus Betting is supervised by the National Betting Authority (NBA) which was firstly introduced under The Betting Law of 2012 and regulates all betting activities in Cyprus for both online and land-based gaming.


Types of Licenses

Class A- This license is issued to entities that wish to promote land-based betting. Under the license, land-based sports betting-bookmaker shops with physical premises are regulated.

Class B- This license is issued to entities that wish to promote online betting activities excluding slot machines, online casino games and electronic horse-racing betting.


Main Requirements to Acquire a License

Issued and paid up capital is at least €500,000.00 (Five Hundred Thousand Euro)

Application will need to be accompanies by a bank guarantee from a credit institution for the sum of €550,000.00 (Five Hundred Fifty Thousand Euro) with a validity that extends to 6 months after the expiration date of the bookmaker’s license requested in the application form.

Properly present that the applicant has appropriate resources and maintain the minimum reserves required -which are decided on by the Authority- to ensure that winnings are paid to players

Maintain suitable control and accounting control system in place for the betting services offered

Applies appropriate terms and conditions (approved by the Authority)

If the applicant company is registered abroad it needs to have an overseas company branch in Cyprus or a partnership with a Cypriot company and whose principal activity is the carrying out of bets (same capital requirements as a locally registered company i.e. €500,000)

Payment of license fee:

o €30.000 for 1 year

o €45,000 for 2 years

Appointment of local representative for application purposes

Submission of Application Form and Personal Declaration Form

Additional requirements and documentation


Personal Declaration Form

A personal declaration form will need to be completed and submitted for each of the following individuals:

Authorized representative

Ultimate Beneficial Owner

Officer

Holder of Substantial interest (>5% voting rights)

The personal declaration form is accompanied with various Know your Client documentation including but not limited to the following:

ID & Passport

Passport Photo

Utility Bill (recent 3-6 months old)

Criminal Records (Country of Birth & Country of Domicile/Residence)

Bank Reference Letter

Bank Statement

CV

Statement of other lawful activities

Source of Funds


Betting Tax

Based on the provisions of the law as amended and repealed from time to time each Class A or Class B bookmaker is liable to a combined rate of 13% tax which consist of 10% of net revenue and 3% contribution to the Authority which 2% is allocated to the Cyprus sport Federations and 1% to gambling addiction programmes.


Class A & B in numbers


New Developments

On the 30th of November 2020 the NBA issued its draft bill to the public for open consultation purposes. From a brief review of the draft bill its evident that the NBA is seeking innovation and to enter different sectors of the gaming industry.

New products and licenses are added to the betting industry in Cyprus, according to the two draft bills submitted in consultation with the National Betting Authority (NBA). Under the bills, Class A (land based) and Class B (online) betting service providers will be able to provide betting services for sporting or other events involving individuals engaged in skill games and virtual games.

At the same time, the Authority will be able to provide two other types of permits/licenses. Specifically, in addition to the Class A recipient license, which provides betting services within a licensed establishment (agency) and the Class B recipient license, which provides online betting services, now a software vendor license will be provided, authorizing the creation, commission , installation and configuration of gaming software. Additionally, the NBA will be able to grant slot machine license, authorizing the construction, supply, installation, maintenance and repair of a gaming machine. The last two provisions were included in the bills for consultation purposes.


In the meantime, an online betting provider may provide gambling services outside the territory of the Republic only if it makes a request to the Authority in connection with the gaming services it will provide. This is an innovative amendment to the current legislation where anyone who is not from a Cyprus IP Address was banned/barred from enjoying the benefits of the services offered by Class B providers.

These new developments along with Cyprus attractiveness (as analysed below) as a jurisdiction makes this small Mediterranean island an ideal place of incorporation and provision of gaming services.


Why Cyprus

Cyprus is Europe’s eastern outpost at the cross roads of three continents- Europe, Africa and Asia-providing a gateway to and from each one of them. The country’s strategic geographical position has allowed it to be a global trade center for thousands of years.

Today Cyprus still enjoys the privilege of being one of the most attractive business hubs in the world as well as a full member of the European Union and the Eurozone. From its accession to the European Union in 2004 Cyprus has aligned fully with the EU Acquis Communautaire and with the code of Conduct for Business Taxation, whilst having some of the lowest tax rates available in any EU member country.

Cyprus owes its success as a global financial center to its low operational costs, advantageous legal and regulatory framework, highly educated and multilingual workforce as well as having an advanced network of banking, accounting and consulting services able to compete with the top percentile of the world.

Cyprus financial industry in the past decades has maintained an excellent international reputation of being a trustworthy and dependable jurisdiction to conduct business at a top-notch professional level.

The island’s excellence in the financial world and in connection with its admirable ability to comply with international regulations has granted Cyprus the achievement of being featured as one of the Organization for Economic Co-operation and Development’s (OECD) white listed countries.

Cyprus is constantly reforming its legal framework to augment its attractiveness as a business center with various innovation including its IP Box Regime which arguably will be an important tool for any license holder of the new proposed software vendor license.


We are a team of experienced professionals, all sharing a unique drive for learning and development through teamwork. The Group utilizes its various core activities to implement customized solutions for its clients. Our collective experience spans the areas of Global Corporate & Fiduciary Services, Assurance & Advisory Services, Fund Administration, Tax Advisory, Corporate Governance, Financial Services, Private Wealth Services and Compliance.

Start a conversation with us today to find out how you can benefit from a relationship with Flexi Group.

Please get in contact with our Head of Business Development:

Mrs Daniella May / Head of Business Development

Tel.: + 357 7000 2 5555 / + 357 22 87 57 55

E: inquiries@flexi-group.net

We also organize calls using Skype. Our flexi Skype ID is web@flexi-group.net


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