Regulation and Licensing of Online Casinos
Online casinos are regulated and licensed by the different gambling control boards depending on which jurisdiction they are operating under. Here is a guide explaining which organisations regulate and license casinos and what the different jurisdictions have the power to do.
For an online casino to operate, it must apply for a license with a jurisdiction that offers licenses for a territory that the casino wishes to operate within as part of the casino licensing act. For example, if a casino is launched and wants to offer games to players within the UK then it must have a license with a jurisdiction such as the The Gambling Commission or The Alderney Gambling Control.
These jurisdictions have the power to award and revoke gambling licenses for different territories across the world and they keep a keen eye on those casinos that possess a license with them to maintain a regulated market.
Licensing jurisdictions usually employ third party organisations to help them regulate the casinos that are operating under their casino licensing requirements. An example of this is that the UK's Gambling Commission uses the Remote Gambling Association. Other regulatory organisations include eCOGRA (eCommerce and Online Gaming Regulation and Assurance), EGBA (European Gaming and Betting Association), IBAS (Independent Betting Adjudication Service), and G4 (Global Gambling Guidance Group).
The aim of these regulatory bodies is to monitor casinos and poker rooms that have been awarded a license to operate under a territory that the jurisdiction awards licenses for. The regulators can help to settle any disputes or complaints that might arise between players and the casinos to guarantee absolute fair practice at the casinos involved.
Jurisdictions – The Good, the Bad, and the Ugly
The jurisdiction that a casino opts for depends on the market they wish to offer their product to. A recent law, The Gambling (Licensing and Advertising) Act 2014, passed by the UK government meant that casino operators had to be located within UK shores if they wished to avoid a heavy taxation aimed at offshore-based operators. This meant casinos that had a license with jurisdictions such as Kahnawake, Gibraltar, or Malta had to re-evaluate their approach to the UK market. So a large number of operators were forced to apply for a license with the UK Gambling Commission in order to offer their casinos to the UK market.
There are also jurisdictions that are considered to be stricter with their guidelines and regulations than others. The Dutch market has seen a number of developers including Sheriff Gaming and Betsoft Gaming investigated for alleged fraudulent activity due to the Dutch market's zero tolerance approach to certain aspects of its laws and this can have a big impact on the games a casino can offer.
Another deciding factor for a casino when choosing which jurisdiction to apply for a license with is its tax treaties with other countries, specifically those countries that have a gambling market that the casino operator intends on targeting.
Then there are the more disputable jurisdictions where the laws and guidelines are not so black and white. An example of this would be the Russian market where there laws are currently in a state of flux due to imminent law changes with gambling only legal in certain regions for the time being although this is expected to change in the near future.
What to Look Out For?
The main thing for you to look out for is to make sure that the casino you visit has an operating license awarded by a jurisdiction that works with the country you are playing in. Gambling laws change on a frequent basis and, as part of these changes, these casinos can often be forced to alter their guidelines such as which jurisdiction they have a license with or which nationality of players they can allow to play at their casino.
It is also important to check that the casino you use is independently audited and that it is approved by a regulatory organisation. Any casinos that lack these are operating below the level of acceptability and should be avoided at all costs for your own safety and security. Casino licensing and regulation was introduced for a reason and has remained in place for the benefit of the players that visit the casinos.