Lawmakers in Croatia are believed to be working on the introduction of a new online betting regime as unregulated market exceeds HRK2 billion
The Croatian Ministry of Finance has been crafting a legal framework that would re-organize the local gambling field in a manner that would require foreign online betting operators to obtain a license from local authorities or cease operations in the market, news outlets Jutarnji List and Total Croatia News reported over the weekend.
Croatia’s current gambling regulations mandate that a betting operator should establish physical presence in the country in order to be able to operate in the local market. However, offshore online gambling operators have been targeting Croatian gamblers for years without holding the necessary authorization.
According to local media reports, Croatia’s unregulated sports betting market is worth HRK2 billion (approx. $307 million). The country is thus losing millions in tax revenue as internationally licensed operators targeting local customers are not paying any taxes.
Advocates of the current regulatory situation in the local sports betting market justify the fact that customers opt for unregulated operations with the “high and unjust” fees and taxes on betting winnings they are required to pay when gambling through regulated outlets. At present, gamblers are charged 10% on their winnings, with the rate going all the way up to 30% for winnings of over HRK500,000.
Underage Gambling
The legal age for gambling in Croatia is 18. Gamblers that want to place wagers with any of the locally licensed betting outlets are required to register and prove their eligibility to gamble. However, Jutarnji List noted in its report on the matter that underage gamblers are able more easily to circumvent age verification requirements when registering with offshore operators.
The Croatian Ministry of Finance has apparently been working on a legislation that would include requirements for unlicensed operators to either obtain licenses from local regulators or leave the market. However, critics of the current regulatory regime have pointed out that lawmakers have been taking too long to craft the new regulations.
While other European countries have failed to introduce sports betting rules that allow international companies to operate in a regulated field due to the fact that they prefer a monopoly regime, the case is slightly different in Croatia. The country’s two biggest sports betting chains – SuperSport and Hattrick-PSK are both already owned by private companies.
According to the latest figures available, Croatia’s regulated gambling market was worth HRK2.7 billion in 2016, with the state-owned Hrvatska Lutrija being the top performer with revenue of HRK500,000 that year. SuperSport generated revenue of HRK393.5 million in 2016, while Hattrick-PSK recorded revenue of HRK401.6 million that year.
Local gambling insiders calling for a change in the nation’s current regulatory regime have pointed out that unlicensed operations should be combated by multiple organizations, including the Finance Ministry, the State Attorney’s Office, the Croatian Academic and Research Network (CARNET), as well as local courts as they are the only institutions that can enforce actual prohibition of unregulated activities.
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