Officials Take Steps to Legalize Internet Gambling in Portugal

A bill to legalize online gambling in Portugal has been forwarded to the Parliament and could be approved by the end of the year.

Portugal’s Council of Ministers has recently taken a step forward to regulate online gambling sites in the country. If everything goes according to plan, all details regarding tax rates and the procedure for obtaining licenses should be approved by the Parliament and officially introduced this year.

Prime Minister Pedro Passos Coelho’s cabinet tried to get the Parliament’s approval on the issue last year, but things just didn’t work out that way. After that failed attempt, the Secretary of State for Tourism, Adolfo Mesquita Nunes, recently announced that the government was going to take another shot at it.

Nunes told reporters that the bill “still requires authorization from the parliament”, but was confident that it would come into force “later this year”. If it does, Portuguese players will have access to a wide range of new online services, including gambling on online slots, casino games, sports wagering, virtual poker rooms and betting on horse races.

Liberalizing the market

Online casinos that accept payments from Portugal:

• bgo Casino
• ComeOn! Casino
• Bet365
• Casino Mate
• Casino Sieger

Portuguese gamblers have little to complain about, as every form of gambling is legal in the European country. The industry is regulated by the Santa Casa da Misericordia de Lisboa (SCML), a company that has monopoly on lotteries and sports betting.

There are more than 5,000 shops offering these types of services across the country and players have a wide variety of choices. The SCML also regulates the land-based casino industry; there are currently 9 gambling venues on mainland Portugal and one more on Madeira, all of them licensed by the government.

Until 2013, Portuguese gambling laws encouraged the same monopoly across online platforms, with SCML controlling virtual sports betting and lottery games while foreign internet casinos were actively blocked.

But now all this is about to change, after the government announced last Autumn that the online gambling market would be liberalized. Portuguese authorities are aware that this business is very profitable and have thought it would be better to open the market to foreign investors and tax them instead.

The new face of online gambling in Portugal

While the government hasn’t set any tax rates yet, any extra income to the state’s budget will be appreciated. The new bill proposes a 15 to 30% tax on gross gaming revenue for online companies, and a turnover tax of 8 to 16% for online sportsbooks in Portugal.

In order to “be held accountable legally and fiscally”, companies providing such services will need to have representation in Portugal, use a .pt domain and use a local bank account for their financial transactions. However, these requirements were not included in the bill.

Nunes also added that SCML will get to keep its exclusive rights to control the existing lottery games and land-based sports betting operations. However, the good part is that foreign companies can now follow a procedure to obtain a license to operate in the country.

With the money accumulated from taxes, the government plans to strengthen sanctions against illegal gambling, and to create new “social policies” for the distribution of revenues. At the same time, authorities will have the right to block online websites that are operating without a license.

Implementation due by the end of 2015

The government argued that such policies are needed to reduce illegal gambling as much as possible, adding that “special perspicacity of the Portuguese regulation is required”. If the Parliament approves the new law, the government will have 180 days to implement it.

“Considering the extent that this activity is almost entirely out of the current regulatory framework, it is necessary to promote its regulation in order to legalize operators and players that are now moving in the illegal market with a high degree of risk and with disastrous consequences to the state and to the public order,” the government said.

Local casinos asked the government to give them exclusive licenses to offer online gambling services, but officials ignored these requests.

“It’s good that online gambling will be regulated and that it becomes a legal game. How it will be done can be more or less pleasant,” said Jorge Armindo, president of the Portuguese Casino Association.

The online casino industry will be supervised by a newly-formed regulating body called Gaming General Inspection, under the umbrella of Turismo de Portugal.