The Romanian gaming industry has experienced notable transformations over the past few years, positioning itself as a dynamic and competitive marketplace in Europe. As we enter the fourth quarter of 2023, a fresh set of gaming fees have been unveiled, representing another significant shift in the country’s approach to regulating its blossoming gaming sector. In this article, we delve deep into the nuances of these new fees and what they signify for operators, players, and the broader industry.

1. Background of Romanian Gaming Legislation

Since Romania’s gaming legislation overhaul in 2015, the country has aimed at fostering a more transparent, fair, and liberalized market. By harmonizing its regulations with European standards, Romania has attracted numerous international operators, resulting in a diversified and competitive gaming landscape.

2. The Rationale Behind the New Fee Structure

The National Gambling Office (ONJN), Romania’s primary regulatory body for gambling, has highlighted the new fee structure’s objectives as:

• Ensuring a fair and competitive marketplace.
• Channeling players towards regulated operators, thereby enhancing player protection.
• Boosting state revenues from the lucrative gaming industry.

3. The Revised Fee Structure

OUG 82/2023 is a pivotal regulatory update designed to amend and supersede provisions in OUG 77/2009 and OUG 20/2013. This ordinance introduces key modifications, particularly concerning the fee structures associated with licenses, authorizations, social contributions, and financial guarantees. These changes aim to reflect the evolving dynamics of the gambling industry, ensure better governance, and promote responsible gambling. OUG 82/2023 stands as a testament to the government’s commitment to adapt and ensure a balanced, secure, and transparent gaming ecosystem for both operators and participants.

a) Licensing Fees:

The new structure has revamped the licensing fees based on the operator’s size and market share. Larger operators with a more significant market share now face a steeper fee compared to smaller, niche operators.

• Lotto: €200,000
• Mutual Betting: €65,000
• Fixed-Odds Betting: €200,000
• Counter Betting: €150,000
• Casino Activities: €150,000
• Poker Clubs: €25,000
• Slot Machines: €150,000
• Bingo Halls: €15,000
• Television Bingo: €150,000

Licensing Fees for Remote Gambling:

• Class 1 License (Tailored for remote operators interfacing with players directly): €300,000 annually.
• Class 2 License (Applicable for both traditional and remote gambling entities, and related assessment bodies) at €20,000 annually. This encompasses:
  • Platform management and hosting providers
  • Transaction facilitators
  • Gaming software developers and suppliers
  • Affiliate entities
  • Certification providers
  • Audit agencies
  • Conformity verification entities
• Class 3 License (Exclusively for lottery games): €200,000

Additional Gaming Categories:

• Poker Festivals: €20,000
• Short-Term Casino Operations (Valid for 3 months): €27,500
• Traditional Raffle Games: €20,000
• Conventional Video Lottery: €100,000

b) Operational Fees:

Previously, operational fees were a fixed sum for all operators. The new system introduces a tiered approach where operators pay according to their gross gaming revenue (GGR). This progressive system ensures that operators contribute to state revenues proportionally.

• Lotto: €300,000
• Mutual Betting: 21% of the game’s revenue according to art. 11 of the emergency ordinance, with a starting rate of €120,000.
• Fixed Odds Betting: 21% of the game’s total revenue, starting from €200,000.
• Counter Betting: 21% of the game’s revenue, starting at a base rate of €200,000.
• Casino Activities:
  • Bucharest location: €70,000 per gaming table.
  • Locations outside Bucharest: €40,000 per table.
• Poker Clubs:
  • Within Bucharest: €82,500 per venue.
  • Outside Bucharest: €38,500 for each venue.
• Slot Machines – Class A: €5,300.
• Bingo Halls: €7,500 for each venue. Additionally, there’s a 5% charge on the card’s value procured from the “National Printing Company”.
• Television Bingo Games: 23% of the game’s revenue, with a threshold of €150,000.
• Remote Gambling (For Class 1 & 3 licenses): 21% of game earnings, with a base rate of €400,000.
• Poker Festivals: €35,000.
• Short-Term Casino Activities (Valid for 3 months): €22,000 per table.
• Raffle Activities: €85,000 for each venue, plus an extra 5% of the ticket value sourced from the “National Printing Company”.

c) Guarantees

To safeguard financial interests, operators are required to hold specific capital reserves, particularly if they fail to meet their licensing fee commitments. The necessary reserve amounts may escalate to as much as €1,000,000 by 2025 based on the company’s earnings.

Traditional Gambling (excluding casinos):

2024 Requirements:

• For earnings up to €5,000,000 annually: A reserve of €500,000.
• For earnings between €5,000,001 to €20,000,000 annually: A reserve of €800,000.
• For earnings exceeding €20,000,001: A reserve of €1,000,000.

Starting 2025: A standardized reserve of €1,000,000, regardless of annual earnings.

Traditional Casino Gaming:

Fixed reserve: €3,000,000.

Online Gambling (not including online casinos):

2024 Requirements:

• For earnings up to €5,000,000 annually: A reserve of €500,000.
• For earnings between €5,000,001 to €20,000,000 annually: A reserve of €1,000,000.
• For earnings exceeding €20,000,001: A reserve of €2,000,000.

Starting 2025: A consistent reserve of €2,000,000, regardless of annual earnings.

Online Casino Gaming:

2024 Requirements:

• For earnings up to €5,000,000 annually: A reserve of €1,000,000.
• For earnings between €5,000,001 to €20,000,000 annually: A reserve of €2,000,000.
• For earnings exceeding €20,000,001: A reserve of €5,000,000.

Starting 2025: A fixed reserve of €5,000,000, independent of the company’s annual revenue.

d) Social Fee

The primary funding for the organization is derived from the yearly contributions of licensed gambling operators. Here’s a detailed split:

• Remote Gambling, Class I: An annual fee of €500,000.
• Entities Actively Engaged in both Traditional and Remote Gambling, Class II: €15,000 per year.
• State-Controlled Remote Games, Class III: €100,000 each year.

For Traditional Gambling Operators:

• Lotto Games: Annual fee of €200,000.
• Video Lottery Machines: A yearly charge of €100 per unit.
• Pari-mutuel Betting: €50,000 per annum.
• Fixed-odds Betting: Yearly contribution of €200,000.
• Return Betting: €100,000 each year.
• Specific Casino Games: €4,000 per game table every year.
• Poker Club Activities: Annual fee of €5,000 for each club.
• Slot-machine Gaming: There’s a staggered fee structure:
  • €300 for each authorized slot in 2024.
  • €500 for each authorized slot starting 2025.
• Bingo in Gaming Rooms: €5,000 yearly.
• TV Broadcasted Bingo Games: A yearly contribution of €500,000.

Reinforcing its dedication to ensuring responsible gambling, the government has decided to allocate 70% of these augmented contributions to the national treasury. The remaining 30% will fund programs that advocate for responsible gambling practices.

e) Penalties and Fines:

The ONJN has also revised penalties for non-compliance, with heftier fines for serious infringements. These changes aim to deter illegal operations and unlicensed gambling activities more effectively.

4. Implications for Operators

The new fee structure certainly presents mixed feelings amongst operators:

Pros:

• Smaller operators are now afforded a more level playing field, allowing them to compete more effectively against industry giants.
• The tiered system might attract more operators to enter the Romanian market, further diversifying the industry.

Cons:

• Larger operators might perceive the steeper fees as punitive and might rethink their investment strategies in Romania.
• Some operators might try to pass on the increased operational costs to players through reduced odds or bonuses.

5. Implications for Players

For players, the new fee structure has both direct and indirect effects:

Direct Effects:

• Players might experience reduced bonuses and promotions as operators adjust to the new fee regime.

Indirect Effects:

• The heightened competition might foster innovation, leading to improved gaming products and services.
• Enhanced player protection as the ONJN channels players towards licensed, regulated operators.

6. The Bigger Picture: Romanian State Revenues and the Gaming Sector

One of the primary motivations behind the new fee structure is to bolster state revenues. As the Romanian gaming industry continues to grow, it represents a significant potential revenue stream for the government. The new fees are expected to contribute substantially to the national coffers, funding various public projects and services.

7. Conclusion

The Romanian gaming sector is at an exciting crossroads. While the new fee structure of October 2023 has been met with mixed reactions, it underscores the government’s commitment to fostering a fair, competitive, and player-centric gaming environment. Only time will tell how these changes shape the industry’s future trajectory, but one thing is certain: the Romanian gaming sector remains an ever-evolving and dynamic landscape, ripe with opportunities and challenges alike.