EU gambling licensing: Key markets, costs and risk mitigation

14.4.2026 | ARROWS law firm

Operating gambling in the EU is subject to different regulatory systems in each country. Capital requirements, licensing fees, and tax burdens vary. The absence of a unified framework means that a licence must be obtained separately in each country. Each market has its own conditions and specific enforcement realities. This article summarises the key markets, costs, and practical aspects for minimising risks.

The photo shows a lawyer during a consultation regarding the regulation of gambling in the EU.

Fragmented European market: Why you cannot simply have “one licence”
The basic building blocks of every EU licence
Financial stability and proof of capitalisation
Related questions on the basic licensing requirements
Comparison of selected major EU markets
Practical risks and the most common mistakes
Underestimating AML/KYC complexity
Ignoring tax and financial obligations

Key takeaways:

The European Union does not have a single gambling regulation; each country has its own licensing system with different requirements, fees and tax burdens, creating a fragmented market with dozens of different regulatory regimes.
Core licensing prerequisites include verification of the origin of assets, proof of financial stability, AML/KYC procedures, software certification and, in many countries, mandatory local presence or registration.
The costs of individual licences range from tens of thousands of euros (smaller markets) to hundreds of thousands or millions of euros (major markets), while annual taxes and fees can represent a significant portion of gross gambling revenue.
Failure to comply with local regulatory requirements may result in high fines in the millions of euros, payment blocking, financial penalties and even criminal prosecution depending on the severity of the breach.

Fragmented European market: Why you cannot simply have “one licence”

The first thing every entrepreneur must understand is that the European Union does not have a single legal framework for regulating gambling. Unlike financial services, which are governed by EU directives, or data protection law, which is harmonised by the GDPR, gambling remains primarily within the remit of individual Member States.

While the European Union has issued recommendations and harmonises certain areas (such as anti-money laundering), the granting of licences itself and the detailed operating rules remain within the competence of national governments.

What does this mean in practice? That the 27 EU countries plus other states such as Norway, Iceland and Liechtenstein (within the EEA) have their own legal frameworks, regulators, licensing processes and sanction mechanisms. An operator that wants to operate in five countries will not obtain one licence. It will obtain five licences—each with different conditions, timelines, costs and legal obligations. When setting a licensing strategy across jurisdictions and aligning regulatory requirements, it may be useful to involve a gambling and lotteries team.

Some states (such as Denmark or Malta) operate a relatively open licensing regime, where multiple operators can coexist in the same market. Other states (such as Norway or Finland, which have recently been undergoing liberalisation) maintained state monopolies, where gambling was operated only by a state operator or a very limited number of entities.

An emerging trend is a hybrid model, where traditionally monopolistic states partially liberalise the market and allow private operators to enter with new licences.

The consequence? An operator cannot strategically say: “We will be in Europe.” It must say: “We will be in Germany, Italy and Spain—and that means three completely different legal and business projects.” In practice, experience in CNB licences and investments is often also relevant when setting licensing and regulatory strategy across countries (including supervisory requirements and financing structure). In such cross-border projects, it also pays to consider AML/KYC and the technical set-up of processes, as discussed in our update verification of the identity of online gambling players: legal requirements and technical solutions.

The attorneys at ARROWS, a Prague-based law firm, have experience with cross-border regulatory projects and can guide you through the individual phases of licensing in specific countries. If you are considering expansion into multiple markets, it makes sense to verify interdependencies and processes with an expert so that unnecessary mistakes and delays do not accumulate.

The basic building blocks of every EU licence

Although individual countries differ in the details, there are certain common principles that must be met in every country. Without understanding them, it is easy to see why a “simple” licence application typically takes 6 to 18 months.

Ownership transparency and background checks

Practically every regulator requires you to demonstrate who actually owns and controls your company. This is not just about the formal ownership structure; regulators require a detailed overview of all persons who have direct or indirect influence over decision-making. Typically, these are so-called “beneficial owners”—persons who own more than a certain percentage of shares or voting rights, or otherwise exercise significant influence.

What must be established about these persons? Countries require:

Verification of integrity. It is not just that the owner has no criminal record; in many countries the owner must prove that they have never been convicted of an economic offence, a property offence, or an offence related to money laundering or terrorist financing. In some countries, extracts from multiple jurisdictions are required if the owner has foreign ties.
Financial clean record. Regulators want to be sure you do not have unpaid taxes, social security contributions or creditor liabilities that could compromise you in the future. In the Czech Republic, the so-called “no-debt status” is required—confirmations from tax and social security authorities.
Origin of funds. For the practical impact of AML obligations on operators (including verification of sources of funds), we recommend the follow-up text obligations of gambling operators in the area of AML and terrorist financing. Especially for larger licences or operators from third countries, regulators want to know where your funds come from. This is part of the global effort to combat money laundering and terrorist financing. If you cannot explain the origin of the capital, the licence will not be granted—or it may be revoked later.

Financial stability and proof of capitalisation

Gambling entails a unique financial risk: the operator must be able to pay out players’ winnings at all times. If an operator goes bankrupt while holding money in player accounts, players will lose their deposits. This is why virtually all jurisdictions require the operator to demonstrate a certain level of capitalization.

Minimum equity varies from country to country. In Malta, a minimum of EUR 40,000 is required for certain types of B2B licences, up to EUR 240,000 for operators running multiple game types, effective from July 2025.

In Greece, the minimum amounts for online gambling are also in the hundreds of thousands of euros. In Germany or Italy, exact minimum amounts are not always set by law, but regulators expect the operator to have capital commensurate with the planned operation—typically in the hundreds of thousands of euros.

In addition to minimum capital, regulators require:

Audited financial statements. If you already operate another company, the regulator will usually require at least the last 2–3 years of verified financial statements.
Bank guarantees. In many countries, you must provide a bank guarantee in favour of the regulator (or in favour of players). In , in Italy, guarantees can be significantly higher, reaching millions of euros. This guarantee remains “frozen” for the duration of the licence and cannot be used for day-to-day business operations.
Insurance. Many countries require the operator to have liability insurance covering risks associated with gambling operations. This is not a given; insuring a gambling operation is more difficult and more expensive than insuring a standard e-commerce business.

Anti-money laundering and KYC obligations

Gambling is one of the most strictly regulated sectors when it comes to money laundering. This is because it is relatively easy to place “dirty” money as bets and then withdraw it “clean” as winnings—or at least create the impression of a legitimate source.

Therefore, all EU Member States require the operator to implement so-called KYC (Know Your Customer) and AML (Anti-Money Laundering) systems.

This means:

Verification of players’ identity. The operator must know the identity of every player—it is not just an email and password, but a real verification that the person registering is who they claim to be. Typically, a copy of an identity document is required, sometimes also video verification.
Transaction monitoring. The operator must monitor whether a player’s behaviour is suspicious. Typically, the operator is required to file a Suspicious Activity Report (SAR) when, for example, a player deposits a large amount at once and immediately withdraws it without playing, or when they carry out an unusual number of transactions.
Due diligence on certain players. If a player comes from a so-called “high-risk” jurisdiction, or if they have a high transaction volume, the operator must carry out deeper checks—so-called Enhanced Due Diligence (EDD).
Reporting obligations. The operator must be able to provide regulators or financial authorities, upon request, with detailed transaction reports. In the EU, new regulation is also being introduced aimed at a single standard – , which will be fully effective in 2027 and will harmonise certain AML requirements, including those for the gambling sector. Preparation is already required in 2026.

All of this means your system must be designed from the outset to collect and retain this data. If you do not do this properly, you risk the regulator suspending or revoking your licence—without further chances.

Comparison of selected major EU markets

The Czech Republic has a long tradition of gambling regulation. Since 2017, it has been governed by Act No. 186/2016 Coll., on Gambling Games, which establishes a structured licensing system.

Czech Republic: A regulated market with certain restrictions

Licensing requirements: For an operator to run gambling in the Czech Republic, it must first obtain a so-called “basic permit” from the Ministry of Finance. The basic permit certifies that the operator meets the general conditions—i.e., the above-mentioned requirements for transparency, financial stability, and AML. The operator must then obtain a “permit to locate gaming equipment” for the specific type of gambling it wishes to operate (e.g., a separate licence for betting, another licence for technical games—slot machines, another for live games—casino games, lotteries, etc.).

If the operator wants to operate technical games located in land-based premises, it must also obtain consent from the local municipality.

Financial requirements and costs: The operator must provide a monetary security. The amount of the security varies depending on the type and scope of the gambling games operated, but typically amounts to tens of millions of CZK for online games and technical games.

A bank guarantee is a possible alternative to the monetary security. In addition, the operator pays administrative fees for filing the application, which can reach hundreds of thousands of Czech crowns for individual permits.

Time horizon: Both the basic permit and the permit to locate gaming equipment are granted for a fixed period (usually 6 years). Their continuation primarily depends on whether the operator continuously complies with its obligations.

Specifics: The Czech Republic is specific in that certain gambling games (e.g., number lotteries with large jackpots) are primarily operated by state-controlled entities, although the law allows them to be operated by private operators under strict conditions. There is also a central register of excluded persons (Rejstřík vyloučených osob), which aims to protect persons at risk of pathological gambling.

Persons who receive subsistence benefits, are insolvent, or have been banned from entering gaming halls or casinos are automatically entered in this register.

Germany: A unified system for online games (GlüStV 2021)

In 2021, Germany moved from a fragmented system (where each of the 16 federal states had its own rules) to a unified federal system, the Glücksspielstaatsvertrag 2021 (GlüStV 2021), which regulates gambling across all states at once.

Licensing model: Germany now offers unified licences for specific types of online games—namely online sports betting, online poker and virtual slot machines. The operator submits a single application and receives one (or more) licences for the selected type of games. The central regulator is the Gemeinsame Glücksspielbehörde (GGL).

Financial requirements: Germany requires the operator to have its registered seat in Germany or another EU/EEA country and sufficient capital corresponding to the planned operation. The GGL publishes a public whitelist of all licensed operators—if you are not on it, you cannot operate legally. Virtual slot operators must also pay a licence fee, typically in the tens of thousands of euros.

Player protection: Germany is one of the strictest regulators when it comes to player protection. It requires centralised player files (the so-called “central register” OASIS) to prevent the same player from registering with multiple operators and exceeding limits.

The operator must apply a monthly deposit limit for the player (standardly EUR 1,000, although the GGL may grant exceptions for particularly solvent players), virtual slots must not have progressive jackpots, and there must be at least 5 seconds between individual games (so-called “slow play”).

Advertising: Gambling advertising in Germany is subject to strict regulation—essentially, it is prohibited to advertise between 6:00 and 21:00, and all advertising must include a warning about problem gambling and a link to support.

Italy: Recent reform and a reduction in the number of operators

At the end of 2025, Italy underwent a major reform of online gambling aimed at streamlining the market and increasing player protection. Instead of the previous system, where multiple market brands (so-called “skins”) could operate, the new system allows one operator to run only one online brand and one domain under a single concession.

Licensing model: The new system works with so-called “concessioni” (concessions), which are awarded through a public tender or auction. The Italian regulator ADM (Agenzia delle Dogane e dei Monopoli) issues a limited number of concessions; operators apply, and the one that offers the best terms for the state and meets strict qualification requirements receives the concession.

Costs: In previous rounds, the licence fee for one concession was in the range of several million euros (e.g., EUR 7 million in the past), and it is expected that the fee for new concessions will also be significant. This is one of the highest licence fees in Europe.

Tax burden: Operators pay tax on gross gambling revenue (GGR – Gross Gaming Revenue)—the rate ranges from 15–30% depending on the type of game and the volume of turnover.

Player protection and advertising: Italy has strict advertising rules; gambling advertising is limited to certain times and channels and is tightly regulated. The operator must have certified gaming systems, AML/KYC procedures, and must submit to strict monitoring by the ADM.

United Kingdom: A long-established regulatory regime

The United Kingdom (after Brexit no longer part of the EU, but one of the most important markets for European operators) has one of the most developed regulatory structures.

Licensing system: The UK Gambling Commission issues three main types of licences—an operating licence, a software licence, and personal licences for key personnel (personal management licence). An operator therefore typically needs all three to operate legally.

Financial requirements: The UK does not have a statutory minimum capitalisation, but when assessing an application the Gambling Commission requires evidence of solvency and a robust financial plan to ensure that the applicant is able to finance its operations and pay out winnings.

Tax burden: The UK imposes “Remote Gaming Duty” at 21% on gross gambling revenue (GGR) for online gambling games. This is a relatively high rate across Europe.

Advantages: The UK has a stable legal environment, long-established case law, and a low risk of ad hoc regulatory changes. This attracts operators who value legal certainty.

Malta: A more flexible approach and a hub for European operators

Malta has become one of the most important centres for online gambling in Europe. The Malta Gaming Authority (MGA) is known for a relatively accommodating approach to regulation combined with professional supervision.

Licensing system: The MGA issues licences for various types of gambling and operations (B2C operators, B2B providers, etc.). Malta also offers the concept of a “Corporate Group Licence”, which allows a large group to hold a centralised licence with harmonised requirements, simplifying administration for complex structures.

Financial requirements: The MGA introduced a new capital framework effective from July 2025. Minimum own funds range from EUR 40,000 (for certain B2B services) up to EUR 240,000 for operators running multiple types of games. The operator must maintain positive equity throughout the term of the licence.

Tax burden: Malta charges gambling operators different rates depending on the type of game and profit—typically from 10% for certain types of games up to higher rates for casino games and sports betting.

Attractiveness: Many operators have chosen Malta as their “primary” licence from which they then operate in multiple markets. This is partly due to relative flexibility, and partly because the MGA engages in the so-called “host regulator” approach—i.e., it is willing to liaise with regulators in other countries and conduct supervision in cooperation.

Practical risks and the most common mistakes

Many new operators think that AML/KYC is just “some regulatory checkbox”—that it is enough to link to some clickable tool on the website that takes a photo of an ID card and that’s it. That is a fundamental mistake.

Underestimating the complexity of AML/KYC

Regulators have recently been significantly tightening AML/KYC obligations. The new EU AML package (adopted in 2024, with full effect from 2027) means that, upon request, the operator will have to provide the regulator—within hours or minutes—with complete data on every player transaction. If the operator fails to detect suspicious activity (e.g., a player with a “high-risk” IP address makes a deposit, withdraws winnings and disappears), it faces high fines and potentially even criminal prosecution for facilitating money laundering.

ARROWS, a Prague-based law firm, can help you structure your AML/KYC procedures so that they comply with the latest regulation and have a chance of being approved by the regulator.

Insufficient sensitivity to local regulatory nuances

Each country has its specific “pain point”—certain areas where the regulator will not compromise. In Germany, for example, it is player age and slot restrictions; in Italy, it is advertising and operations without an Italian concession; in the Czech Republic, it may be specific requirements for hardware audits or software certifications.

If you have a licence in Malta and think you can use the same software, the same marketing materials, and the same player limits in five different countries, you are out of touch with reality. Each country requires adjustments.

Those adjustments can be “cheap” (only the texts are changed) or “expensive” (the software must be reprogrammed, the game mechanics are changed).

This is a classic case where a lack of knowledge of local specifics leads to fines or a last-minute licence refusal—when you have already invested tens of thousands in preparation.

Ignoring tax and financial obligations

Online gambling is a highly taxable sector. In some countries, gross gaming revenue (GGR) is taxed; in others, net profit; in some, progressive rates may apply depending on volume. In addition, there are various fees—regulatory fees, monitoring fees, contributions to problem gambling, etc.

If an entrepreneur fails to realise that in Spain they will pay, for example, up to 30–45% of their GGR in taxes and fees (depending on the structure), and this is discovered later, it often means the business model ceases to be viable.

This is a mistake that can be avoided—provided you secure advice from a tax specialist in advance.

Underestimating compliance costs

Compliance costs money.

If you want to operate legally in Europe, you will need to employ at least:

a compliance officer or a part-time lawyer who will monitor regulatory changes and fulfil reporting obligations
a KYC/AML specialist who will configure and monitor your systems for detecting suspicious activity
an audit and certification of your software—this usually means an annual contract with a third party

Total compliance costs can be EUR 100,000–500,000 per year depending on the size of the operation. Many start-up operators do not realise this and are then surprised that their first year is in the red precisely because of compliance.

Risk and solution table

Potential issues	How ARROWS helps (office@arws.cz)
Insufficient or incorrectly structured proof of beneficial owners: the regulator refuses the licence citing insufficient transparency	Attorneys from ARROWS advokátní kancelář will prepare comprehensive ownership documentation, including confirmation of the source of funds, and structure the ownership network to meet the requirements of the specific regulator and to be as transparent as possible.
Underestimating AML/KYC obligations: the operator hires a cheap offshore compliance tool that is not compliant with EU standards; the regulator imposes a fine or refuses the licence	ARROWS advokátní kancelář will help you set up AML/KYC procedures in line with the latest EU regulations (including the new AML package, which will become fully effective from 2027) and ensure that your software and processes comply with the requirements of individual regulators.
Underestimating tax and financial impacts: the operator fails to plan properly and finds that its margins in a particular country shrink to unprofitable levels	Attorneys and tax specialists from ARROWS advokátní kancelář will carry out a comprehensive tax audit for individual countries and help you structure the operation to be tax-efficient while remaining compliant with the law.
Failure to comply with local regulatory requirements for advertising, player limits, or software certification: the regulator imposes a fine in the millions of euros or threatens to revoke the licence	ARROWS advokátní kancelář provides long-term external legal advisory services that monitor regulatory developments in individual countries and alert you to changes; in the event of an offence, we provide representation in dealings with the regulator and defence against fines.
A new competitor reports suspicious activity about you: the regulator initiates an investigation; you do not know your legal rights and obligations in the investigative process	Attorneys from ARROWS advokátní kancelář represent you in regulator investigations, assert your rights to due process, and ensure that your responses are legally correct and do not harm you in further proceedings.

Most common questions on the topic: Gambling regulation in the EU

1. Do I need a physical office in every country where I want to operate?
Not always. In some countries (e.g., Germany, Switzerland), you can have a centralised office outside the given country and appoint an “authorised representative” within the EU/EEA. In other countries (e.g., the Czech Republic for certain types of operations), a physical presence or at least the appointment of a local managing director or a registered seat of the company in the territory of the country is practically unavoidable. It is important to verify this for the specific country where you want to operate. Attorneys from ARROWS advokátní kancelář will clarify this for you and help you find the optimal structure for your specific case.

2. How long will it take to obtain all licences for five countries?
Realistically, plan for 2–3 years if you want to proceed in parallel across individual countries—especially if you run into complications in one country. Typically, one licence takes 6–18 months. If your documentation is messy, regulators ask unnecessary questions, or the regulator requires changes to your software, it takes even longer. For many operators, it pays to start with one or two markets and expand gradually; this also reduces the risk of creating problems in multiple markets at once. Attorneys at ARROWS advokátní kancelář can help with timelines and an expansion strategy.

3. What is a realistic budget for compliance and regulatory costs?
In practice: licence fees range from tens of thousands of euros to several million euros per licence (depending on the country and type); bank guarantees are another EUR 100,000–500,000. Annual compliance, audit, and tax costs are at least EUR 200,000–500,000. On top of that, there is tax on gross revenue (it is usually calculated on stakes, not only on actual profit, which means tax liabilities may arise even at low profitability). Realistically, profitability is usually achieved only in the second or third year—if everything goes smoothly. That is why it is important to have initial capital that will “keep you afloat” during this phase.

4. What happens if I breach a regulatory rule?
It depends on the severity. Minor breaches (e.g., a late report) may result in a warning or a small fine. Medium breaches (e.g., an incorrect AML procedure, where the regulator can see that you made an effort) lead to substantial fines—typically in the range of tens of thousands to single-digit millions of euros. Serious breaches (e.g., misleading players, operating without a licence, facilitating money laundering) lead to criminal prosecution, licence revocation, and a ban on activity. In some countries (e.g., Spain), fines of up to EUR 50 million may be imposed for operating without a licence. It is important to have a lawyer who guides you correctly from the outset and minimises the risk of these situations.

5. Can I buy one European licence from someone else instead of waiting for a new one?
In some cases, yes. If an operator holds a licence and wants to sell it, it may be possible to buy their licence—so-called licence transfer. However, the regulator must approve such a transfer and usually must review the new owner just as thoroughly as if you were applying for a new licence. In addition, the price of a licence on the secondary market often includes a premium—you cannot expect to “buy it cheaply”. Today, this is more of a solution for operators who already have capital and want to enter the market quickly. New operators usually face the standard route—submitting an application, waiting, and approval.

6. If I hold multiple licences in different countries, do I have to pay taxes separately to each country?
Yes. Each country will levy its own tax on your operations in that country. This is not a global tax; it is a tax specifically on the activity carried out in that country. There are certain international double taxation treaties, but in practice you should expect that if you make a profit in Germany, Germany will tax the German profit; if you make a profit in Italy, Italy will tax the Italian profit. It becomes even more complex to structure if you have a centralised parent company with branches—this is where profit centre rules and transfer pricing come into play. This is why taxation in cross-border operations is so complex; the attorneys at ARROWS, a Prague-based law firm, can help you optimise the structure from a tax perspective.

Summary

Operating gambling in the European Union is not something that can be handled without expert support. Although the market may appear attractive (especially in countries with high GDP and a strong consumer base), the legal and regulatory complexity is significant. Dozens of different regulatory regimes mean that an operator must be transparent, adequately capitalised, technically secure, and compliance-ready in each country separately.

The most common mistakes we see among operators who simply tried to “enter” without an expert are:

Underestimating AML/KYC complexity and the corresponding insufficient implementation
Ignoring tax and financial impacts in individual markets
Underestimating the time and resources required for compliance
Neglecting local regulatory nuances (what is a fine in Germany may be a criminal offence in Italy)
Failing to plan for the long term—major regulators such as the UK or Germany change rules only slowly, but when they do change, they change dramatically

If you want to minimise risk and set up your operations correctly from the outset, our attorneys in Prague can provide support in the following areas:

Strategic legal advice when selecting the right set of markets
Preparation of application documents for individual regulators
Structuring AML/KYC procedures and compliance manuals
Representation in communications with regulators
Monitoring regulatory developments and alerting you to changes
Expert opinions on cross-border and tax matters

It is not cheap, but it is safer than trying to manage it on your own. Please contact ARROWS advokátní kancelář at office@arws.cz and consult with our lawyers who have experience in the gambling market.

Notice: The information contained in this article is of a general informational nature only and is intended for basic guidance based on the legal status as of 2026. Although we take utmost care to ensure the accuracy of the content, legal regulations and their interpretation evolve over time. We are ARROWS advokátní kancelář, an entity registered with the Czech Bar Association (our supervisory authority), and for maximum client protection we are insured for professional liability with a limit of CZK 400,000,000. To verify the current wording of regulations and their application to your specific situation, it is necessary to contact ARROWS advokátní kancelář directly (office@arws.cz). We accept no liability for any damages arising from the independent use of the information in this article without prior individual legal consultation.

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