Czech Republic Cracks Down on Illegal Gambling Machines

Czech Customers officers have seized more than 800 illegally operating gambling machines and over CZK2.5 million in proceeds from gaming facilities across the country, local news outlet the Prague Daily Monitor has reported.

The Czech Customs Administration revealed that the money and the gambling devices were confiscated in the ten months to October 31, 2017. The reported figures were the result from 1,417 checks carried out by officers. The machines seized offered slot machines, electronically operated roulette tables, quiz machines, etc.

The devices were found to have been operated illegally in over 50 gambling rooms in different parts of the country, Czech Customers Manager Zdenek Malek told local media on Thursday. The official pointed out that the facilities themselves were illegal and that no illegal machines were found in licensed gambling rooms around the Czech Republic during the checks.

The Czech Customs Administration has been tasked with probing into the nation’s gambling industry and monitoring for any violations conducted by stakeholders as well as by illegal entities. Under the country’s gambling laws, unauthorized gambling operators may be imposed fines of up to CZK50 million and may face seizure of their equipment.

As reported by local media, it has been on multiple occasions that illegal gambling rooms operators have claimed that their operations had nothing to do with gambling and that they have been running charitable facilities or membership gaming clubs.

The Czech Republic’s New Gambling Law

The Customs Administration’s latest announcement comes at a time when the Czech Republic is adapting to its new gambling regulatory framework. The country’s government introduced sweeping reforms to the nation’s gambling industry, which took effect on January 1, 2017.

The new regulations encompassed stricter regulatory measures in relation to the provision of land-based gambling services and the opening of the local market to international online gambling operations, among other things.

The liberalization of the Czech Republic’s iGaming market has, in fact, turned into a popular topic of discussion among industry peers, due to the somewhat controversial nature of the process. Under the new laws, operators with licenses from the Finance Ministry were required to pay taxes of 23% on sports betting revenue and 35% on casino revenue.

The high tax rate added to the unnecessary bureaucracy of the licensing process to make the market highly unattractive to international operators. At present, PokerStars and its sister brand BetStars are several of the few foreign entities to have entered the Czech Republic. On the other hand, giants like William Hill and GVC Holdings’ partypoker have decided to steer away from the local market at least for now.

According to a recent research, the Czech Republic has seen a surge in the number of people with problem gambling behavior. According to the Czech National Monitoring Center for Drugs and Addiction, around 120,000 residents of the country were addicted to one type of gambling or another in 2016. The figure reflected a 16% increase from the year before.

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