The online gambling industry in estonia has experienced rapid growth in recent years, due in large part to advances in technology. The country’s gambling laws have been modified to allow for online gambling, and estonia has begun issuing licenses for online gambling operations. These laws are designed to regulate online gambling and generate revenue for the country through taxes on operators. Online gambling is still in its early stages in estonia compared to other member countries of the european union, but it has been growing rapidly since becoming fully legalized in 2010. This growth can be attributed in part to the global economic crisis of 2008, which led many people in estonia to seek alternative sources of income.
There are many nuances to gambling activities. First of all, entrepreneurs need to know that a license can only be assigned to legal entities with certain organizational and legal forms. The authority board looks at applications and makes decisions on them based on the activities of the enterprise. Permits will be issued if gambling is the only commercial direction of the company. To launch a project, a businessman will need to obtain not one, but two permitting certificates: the first has an unlimited validity period and serves as confirmation that the legal entity meets all demands set by the commission; the second is a gambling license which is valid for 20 years and covers all games provided in estonia.
Differentiating itself from other countries in the european union, estonia chose to legalize and regulate online gambling in 2008. This allowed operators to apply for a license from the estonian tax and customs board in order to offer gambling activities. At first, the market was only open to local operators but after a few years, foreign operators were also given the opportunity to apply for a license. The main reason for this decision was the government’s attempt to recover from the 2008–2009 financial crisis. Prior to legalizing online gambling, many estonians were playing on unlicensed casino sites which did not contribute anything to the country’s economy. However, with more operators acquiring online casino licenses in estonia, there have been benefits for the country’s economy.
Private companies have obtained online gambling casinos in estonia but the state-owned eesti loto is the largest online gambling operator. The lottery company’s website offers games like bingo, keno, vikinglotto, and eurojackpot. Olybet is the second biggest online gambling operator in the country and offers estonians online casino games and sports betting. Olybet is a part of the oeg, which runs most of the land-based casino venues in estonia. While estonia allows both local and foreign operators to apply for online gambling licenses, in 2011, the country also decided to block unlicensed offshore casino operators. Numerous foreign online casinos have been blocked by estonian isps but it seems that they only target bigger foreign companies. If estonian players try to access any of the blocked websites, they are redirected to the official webpage of the estonian tax and customs board. Even though the estonian government has taken measures to restrict access to unlicensed gambling sites, players who attempt to play on unregulated online casinos and betting sites are not prosecuted or penalized.
Estonia also has its own companies that develop gambling software or parts of software solutions for world-famous corporations. Such enterprises include dervico, a studio created in 1996, and foxium, a relatively young studio which appeared in 2015. These companies develop mobile applications and pc slots for microgaming. They have all sorts of bonus features: free spins, bonus games, wheel of fortune with additional prizes. The gambling industry in estonia is growing despite the fact that it is strictly regulated by the authorities. The state supports the organisation of new land-based casinos and online websites and taxes gambling enterprises. The funds received from casinos are invested into the development of culture and sport, the creation of social programs and financing medicine. In addition, estonian players can voluntarily add themselves to a black list if they feel addicted to gambling and refuse to play in land-based or virtual casinos. In 2016, more than 2,000 fans of gambling voluntarily added themselves to the black list. Today, most of the players in estonia are foreign tourists.
Gambling provides a stable source of revenue for the estonian government. The country’s budget is replenished through the acquisition of licenses and permits to provide gambling services, as well as through taxes on games (depending on the type). So, operators pay a fixed amount for table games and slot machines, and in addition — a certain percentage of the bets placed on the table or on the slot. Owners of the license to organise lotteries give the state 18% of income and operators of sweepstakes — 5%. This money is used to develop the country’s economy and is allocated to finance various cultural fields.