New hope for Czech gambling industry with approval of bank IDs

Added: January 25, 2021

Czech Republic gambling stakeholders have been hoping that the government will go forth with regulatory adjustments to banking and customer verification requirements that will allow for an easier market entry.

After the 2017 amendments to the ‘Czech AML Act’ in connection with the implementation of a brand new ‘Czech Gambling Act’, the Ministry of Finance administered the requirement for operators to use ‘face-to-face’ customer verifications at 7,500 authorised ‘check-point’ venues.

The strict measure, along with taxes of 23% GGR on sports betting and 35% GGR across online casinos, saw the Czech Republic witness the whole marketplace withdrawal of foreign operators.

A large portion of operators such as bet365, Entain Plc (formerly known as GVC Holdings) and William Hill withdrew from the market claiming that conditions had ‘become unworkable’, and adding that the Ministry of Finance had imposed compliance requirements that no other European market considered as being appropriate. The Czech Ministry of Finance endorsed its measure, citing that face-to-face verifications were necessary to fulfill AML duties and concerns in regards to gambling transactions.

With foreign incumbents refusing to reapply for licences, the ensuing years have seen the Czech sports betting market decrease to merely three domestic incumbents – which are Tipsport, Fortuna and Synot, with domestic stalwart SAZKA Group taking over the lottery market.

After three years in “regulatory isolation”, hope appears once again for the Czech Republic market reforms following the approval of the ‘5th Directive on AML’ which will modernize the country’s banking and customer compliance requirements.

A measure approved by the ‘5th Directive on AML’ will witness the Czech Republic take on ‘remote customer verification’ measures allocated by individual banks. More often referred to as ‘bank IDs’, the Czech stakeholders hope that the compliance measure will inevitably lead to the government loosening its unmanageable face-to-face verification requirements.

Denisa Marcekova, Head of the Czech & Slovak Internet Gambling Association, supported the measure, claiming it has been proven as an effective verification provision in Sweden.

“I strongly believe this is a significant step in the right direction,” she stated. “I hope that the recently launched governmental review of the Czech gambling regulation will result in even smoother access to the market in the near future.”

AffPapa, Czech republic, Entain, iGaming, sport, William Hill