ESTABLISHING YOUR ONLINE GAMBLING BUSINESS IN THE ISLE OF MAN
A top-tier gambling jurisdiction with favorable tax conditions
WHY THE
ISLE OF MAN
- Respected, long-established jurisdiction with robust regulations
- A prestigious banking sector, including physical banks
- Favourable tax environment:
-
- 0% corporate / capital gains tax
-
- Gambling duty 0.1-1.5% based on gross gaming yield
HOW WE CAN
HELP
- Assistance with full set-up, from incorporation to licensing, and ongoing regulatory and financial/legal compliance.
- Provision of local expertise, infrastructure, and support services.
DOING
BUSINESS IN
ISLE OF MAN
INFORMATION ABOUT
THE JURISDICTION
The Isle of Man is a small island and self-governing crown dependency in the British Isles, located between Great Britain and Ireland. Over the last decade it has become recognised as one of the most reputable jurisdictions within the igaming industry, proposing gambling operators with a tier-one license and gold standard regulatory framework. As a leading offshore financial centre, operators also benefit from a range of ancillary services and favourable tax conditions.
GAMING INDUSTRY IN THE ISLE OF MAN
The Isle of Man regulator, the Gambling Supervision Commission (GSC), is known for its strict but fair regulatory standards. As part of the licence application, operators must provide a comprehensive business plan to demonstrate their business structure, financial stability and integrity. Operators must also present robust player protection measures to align with the Isle of Man’s 100% player protection model.
Due to the robust regulation, an Isle of Man license is very respected in the industry, giving credibility and confidence for operators and to their third-party service providers, such as banking institutions, payment processing providers and other ancillary service providers.
More particularly, from a gambling license standpoint, the Isle of Man has positioned itself as an innovative and open-minded with a regulator that is forward-looking and open to new technologies. Some of the main key points to this effect are:
- All gaming verticals are covered by the current license.
- Any games on the registry can be used by Isle of Man licensees without the GSC requesting an additional testing certificate.
- Cryptocurrency, skins and digital assets are viable as stakes / deposits / withdrawals across all licences offered in Isle of Man. One should note that there is a requirement for the player to withdraw the same as they deposit (i.e., you can’t deposit BTC and withdraw USD for example).
- The Isle of Man Gambling Supervision Commission became the first jurisdiction in the world to issue a Blockchain gambling business with a gambling licence and the first jurisdiction to regulate token-based software suppliers.
- Advanced telecoms infrastructure which been used as a test bed for emerging technologies.
- The Isle of Man have implemented regulation for virtual assets, the Designated Business Act.
WHY ISLE OF MAN?
The Isle of Man is a renowned jurisdiction in terms of licensing an online gambling businesses,but it also has a leading reputation in private wealth. The jurisdiction boasts economic, political and legal stability and has the oldest parliament in the world. The gambling legislation is one of the oldest in that geographical area, with the Online Gambling Regulation Act (OGRA) being in force since 2001. The Gambling Supervision Commission (GSC) is tasked with supervising all applications and licensed operators in Isle of Man.
Some of the main advantages in setting up in Isle of Man are:
- A highly esteemed and long-established regulatory framework
- A stable offshore financial centre
- A prestigious banking sector, including physical banks with 200+ employees
- A network of professional firms providing extensive support
- Presence of top-tier infrastructure locally, especially in IT and hosting
- Government grant funding for relocation, hardware, software and marketing
Moreover, businesses located on the Island benefit from:
- Corporation and capital gains Tax of 0%
- Gambling Duty between 0.1% to 1.5%, based on gross gaming yield/profit (not turnover):
- if FFY is <£20m, 1.5%
- if GGY is >£20m-<£40m, 0.5%
- if GGY is >£40m, 0.1%
BENEFITS OF HAVING A PHYSICAL COMPANY
WITH STAFF IN ISLE OF MAN
- Isle of Man residents enjoy some of the lowest tax rates in Europe with a simple and efficient calculation system. The Isle of Man operates a simple taxation regime with two tax rates for individual personal income. The standard rate (or lower) rate is 10% and the upper rate is 20%.
- The tax cap is £200,000 for an individual and £400,000 for a jointly assessed couple.
- Under the tax cap system, an individual must elect for the tax cap to be applied and, if the election is approved, it will apply to the individual for a period of five consecutive tax years.
- Worldwide income (i.e. income not generated in the IOM) can be tax free for 3 years under the Key Employee Incentive Scheme.
THE ISLE OF MAN GAMING LICENSE
A FAST APPLICATION
The process takes 12 weeks from submission of the application, if there are no unexpected issues. This period officially begins when the GSC issues a letter stating that your application has been accepted and the process is underway.
Once the gambling license is issued, it is valid for 5 years.
TYPES OF LICENSES
All gaming verticals fit under one gambling license with straightforward pricing structure, which can be found here. There are different types of licenses according to the requirements of the company to be licensed.
ON THE OPERATOR’S SIDE
- Full License: allows an operator to offer all types of gambling (sportsbook, poker, bingo, casino, slots, binary options, etc) and enables the use of both fiat monies and cryptocurrency (or any other type of digital asset) as a deposit/stake and for withdrawal.
- Sub-license – allows businesses or individuals operating under an existing IOM gambling license to extend their operations to cover additional gambling activities or services.
- Network License: same privileges as the Full Licence but holders may also use the Network Licence to accept players from global operators (Network Partners) on to their gameplay and back-office servers without re-registering the players.
ON THE SOFTWARE & GAMES SIDE
The Software Supplier’s License is for traditional software supplies such as slots / casinos / platforms as well as resellers of these products. This licence is quite flexible and can also cover live dealer studios, back-office platforms and re-sellers, allowing operators and software providers to be assured their partners are operating to high standards of corporate governance.
There is also the option to have a token-based software licence for blockchain / token-based software.
HOW TO SET-UP AND GET A GAMING LICENSE
IN THE ISLE OF MAN
REQUIREMENTS
In order to obtain a gaming license in IOM, a few things need to be considered in terms of the initial and ongoing requirements, as follows:
- An Isle of Man company must be incorporated.
- There is the need of a minimum of two resident company directors: these can be the company's own local staff or directors supplied by EM Group’s local partners, if required.
- One resident Designated Official (DO) must be appointed; or where that Designated Official cannot reside in the Isle of Man, an Operations Manager (OM) should be appointed (the OM can be supplied by EM Group’s partners).
- The company must comply with ongoing regulatory reporting requirements on a monthly / quarterly and yearly basis, which EM Group can assist with.
- All games, RNGs and gambling systems must be certified by an approved test house (certificate of compliance to be received before license is granted)
- Local banking is required – but there are many options available. On occasion, the GSC will accept trading accounts elsewhere.
- There are a few technical requirements, such as (but not limited to):
- The servers, where the bets are struck, are hosted in the Isle of Man (unless a waiver is agreed or operating under a Software Supplier's Licence);
- Players are registered on servers located on the Isle of Man (unless a waiver is agreed or operating under a Network Services Licence or Software Supplier Licence).
PROCESS
The initial phase of the licensing process consists of providing sufficient due diligence on the ultimate beneficial owners, directors and all other key personnel. The preparation of the licence application will include drafting a business plan, completing the financial projections and sensitivity analysis, preparation of the policies and procedures, supporting due diligence on the key officials and key staff.
The big lines of the process are as follows:
The process should take about 12 weeks from the submission of the application (step 2 above), should no issues or queries be raised by the GSC.
FAQ
ABOUT SETTING UP AN ONLINE GAMING COMPANY IN ISLE OF MAN
The benefits of an Isle of Man gaming license are numerous. This license allows operators to target players internationally, provided no local license is required in the targeted country of the players. The Isle of Man is a well-known and respected jurisdiction for online gambling licensing, offering favorable tax conditions for operators since 2001. With a corporate tax rate of 0%, capital gains tax of 0%, and a gambling duty based on profit ranging from 0.1% to 1.5%, the Isle of Man provides a competitive and attractive environment for gaming companies. Additionally, the island boasts top-tier infrastructure in terms of IT, hosting, and banking, making it an ideal location for setting up online gambling operations. Obtaining an Isle of Man gaming license not only ensures compliance with regulations but also opens up opportunities for growth and expansion in the global gaming market.
Moreover, should the business decide to employ people locally or relocate staff, there are many very interesting perks, both from the business side with numerous grants, but also from the employee side with lowered and capped tax rates on salaries.
To understand the type of license applicable to your business, we recommend contacting EM Group directly or by visiting the GSC page. The cost of an Isle of Man gaming license can vary depending on the specific needs and requirements of each business. Our team of experts will be happy to provide you with personalized guidance and assistance on the fees associated with obtaining an Isle of Man gaming license.
Moreover, for accurate and up-to-date information on EM Group’s fees for assistance with obtaining the Isle of Man gaming license, please contact us here.
To obtain an online gambling license in the Isle of Man, an online gambling company must meet the following requirements:
- The company must be incorporated in the Isle of Man.
- The company must have two resident directors
- A Designated Official or an Operations Manager, either the same person as one of the Directors or a person sourced locally from a service provider, must be a resident of the Isle of Man.
- B2C licensees must register players on servers located on the Isle of Man.
- An application fee of £5,250 must be paid and all relevant application forms must be completed.
- B2C licensees must protect player funds at all times.
- All games, RNGs, and gambling systems must be certified by an approved testing house.
- Directors, Designated Officials, Money Laundering Reporting Officers, and beneficial owners controlling 5% or more of the company will be subject to Due Diligence obligations.
These requirements are designed to ensure that the licensee complies with the policies and regulations set by the Gambling Supervision Commission, protecting player funds and adhering to anti-money laundering policies Failure to comply with these requirements may result in the revocation of the license during its five-year validity period. Please note that this list is non-exhaustive and specific requirements can be confirmed with the EM Group team.
An Isle of Man gambling license offers a range of key features that make it a highly desirable option for online gaming operators. This license covers a wide array of gambling activities, from P2P games like poker and bingo to casino games such as slots and live dealer games. Operators can choose from different license types, including a full license (main OGRA License) for B2C operations, a sub-license for operators without their own gambling products yet, and a network services license that allows agreements with other operators. The license is granted for 5 years and can be revoked if terms are violated. Additionally, the Isle of Man's regulatory framework ensures high standards of player protection, anti-money laundering measures, and responsible gambling guidelines. Holding an Isle of Man gambling license provides international recognition, access to payment processing services, intellectual property protection, and ongoing regulatory support, making it a reputable and advantageous choice for online gaming businesses.
The Isle of Man has demonstrated a proactive approach to embracing technological advancements within the industry. By continuously adapting regulations to accommodate emerging technologies such as cryptocurrency, digital assets, and blockchain-based models, the jurisdiction remains at the forefront of innovation. This commitment to staying ahead of the curve fosters an environment conducive to growth and attracts tech-savvy operators looking to leverage cutting-edge solutions in their gaming platforms.
The Isle of Man's ecosystem is characterized by collaboration and synergy among various stakeholders, including government entities, regulatory bodies, industry associations, and service providers. Through initiatives such as industry forums, networking events, and educational programs, the jurisdiction encourages knowledge sharing, partnership building, and mutual support. This collaborative environment not only enhances the overall competitiveness of the Isle of Man as a gaming hub but also fosters innovation, creativity, and sustainable growth for online gambling businesses operating within its jurisdiction.
The Isle of Man Gambling Supervision Commission (GSC) plays a vital role in regulating most forms of gambling within the territory, including land-based and online gambling services. Established in 1962, the GSC ensures that gambling activities remain fair and free from crime, safeguarding the interests of gamblers on the island. The Commission is responsible for licensing and regulating gaming operators, protecting player funds, testing games for fairness, monitoring operators' activities for compliance with the law, and investigating complaints on behalf of players. For further details on the GSC's functions and regulations, it is recommended to contact them directly for more information.
The Isle of Man Gambling Supervision Commission (GSC) plays a pivotal role in regulating both land-based and online gambling operations within the territory. Established in 1962, the Commission ensures that gambling activities remain fair, crime-free, and that players receive their winnings. With the advent of online gambling, the GSC became one of the first jurisdictions to regulate online gambling activities, setting stringent standards to create a secure environment for gamblers. The GSC licenses and regulates all online gaming operations on the island, regardless of where the player base is located. By upholding core principles such as keeping the industry crime-free, protecting minors and vulnerable individuals, and ensuring fair services for players, the GSC promotes a safe and responsible gaming environment in the Isle of Man. For further information on how the GSC oversees online gambling regulation in the Isle of Man, individuals can contact the Commission directly for detailed insights into their regulatory functions and guidelines.
The Online Gambling Regulation Act 2001 (OGRA) is the primary legislation governing the online gambling industry in the Isle of Man. OGRA covers all games that involve telecommunications and players, ensuring fair and responsible provision of gambling services. This Act sets out various requirements for online gambling operators, including licensing conditions, anti-money laundering provisions, advertising standards compliance, player protection measures, and financial transparency. Understanding and adhering to the regulations outlined in OGRA is essential for any online gambling platform operating in the Isle of Man to ensure compliance with the law and maintain a reputable status within the industry. For detailed information on how OGRA impacts online gambling activities in the Isle of Man, it is advisable to consult the official documentation or seek guidance from regulatory authorities like the Isle of Man Gambling Supervision Commission.
The Isle of Man's reputation as a well-established and respected jurisdiction in the global gambling industry significantly influences its position. Known for its robust regulatory framework, favorable tax conditions, and commitment to player protection, the Isle of Man has become a preferred location for businesses looking to establish a presence in the gambling industry. This positive reputation attracts operators seeking credibility and reliability, contributing to the growth and success of the gambling industry on the island. The Isle of Man's strong reputation not only enhances its competitiveness but also solidifies its status as a key player in the global gambling market, attracting both players and operators seeking a trustworthy and regulated gaming environment.
The Isle of Man’s strategic location in the Irish Sea between the United Kingdom and Ireland offers unique advantages for online gambling businesses. Its proximity to major European markets provides access to a large player base, while still maintaining a favorable regulatory environment. Additionally, being situated outside of the UK allows operators to leverage the benefits of the Isle of Man’s regulatory framework while accessing international markets.
WHERE YOU CAN FIND US
EM Group offers compliance and corporate services for companies active in the online-gaming industry in Curaçao, Malta, the Netherlands and Cyprus
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