- Portugal issues seventh online casino license despite tax heavy regulations as operators believe they can still turn a profit
- License brings the total of online sports betting sites up to three
The Portuguese regulatory body SRIJ (the Serviço Regulação e Inspeção de Jogos do Turismo de Portugal) has issued its seventh online casino license to Sociedade Figueira Praia, who will offer online sports betting under the Casino Portugal brand Casinoportugal.pt.
Despite a strict tax regime, the move brings the country’s online sports betting sites up to a total of three since Portugal’s introduction of its regulated online gambling market in May 2016 (Betclic Everest Group and Bet Entertainment Technologies (BET) are the other two online sites).
In total, the SRIJ had previously issued three casino licenses and one poker license but with the addition of Sociedade Figueira Praia to the fore, the total number of companies operating in the sector is now up to five.
Portuguese Government Earning their Share Despite Criticism
After initially struggling to attract operators after issuing its first online gambling license to French operator Betclic Everest in May 2016, the SRIJ are certainly making sure they get a healthy slice of the cake.
The SRIJ released its first report at the beginning of June and the figures revealed showed that sports betting accounted for 70% of the revenue with Football accounting for nearly 75% of all sports wagers, with most of the rest claimed by tennis (15.2%) and basketball (7%).
Portugal’s regulated online market took some flak from the get go after the country’s insistence on sticking with a tax regime that many operators deemed unworkable.
Sports betting in particular appears to bear the brunt of this with a variable tax on betting turn over with operators forced to pay an 8% rate on their first €30m in betting handle, while wagers exceeding that total are subject to rising rates that reach out up to 16%.
The 16% may not appear to be too bad compared to other countries, such as Kenya, but it is still a big enough percentage to put potential operators off the Portuguese market.
This has been reflected in performance in sports betting with revenue falling to €17.4m in quarter one of this year compared to the €22.2m peak the industry saw in the third quarter of 2016.
Positive Signs for the Online Casino Market
Where the sports betting market in Portugal seems to be having a tough time, online casino company Estoril Sol (who were handed the first online casino license by the SRIJ in July 2016) have reported a 50% increase in revenue from Q1 in 2017 compared to Q4 in 2016.
It is hoped that the new license being issued to Sociedade Figueira Praia will help increase the sports betting revenue and generate more interest in the market.
If Sociedade Figueira Praia can make it work, then the SRIJ’s strict tax rules are justifiable in the sports betting sector.
If not, then the risk is that Betclic Everest Group and Bet Entertainment Technologies may end up throwing in the towel forcing the SRIJ’s hands into lower tax rates.
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