Introduction
The Isle of Man is a Crown Estate of the British Crown. This status allows the Isle of Man, on the one hand, to maintain a stable economic situation and not to be blacklisted, and on the other hand, allows the introduction of special tax regimes and create its own business-oriented legislation. An Isle of Man gambling license is more expensive than a Curaçao license, but it has a number of decisive advantages for many entrepreneurs. Firstly, a company with an Isle of Man license operates in the legal framework of the United Kingdom, and secondly, an Isle of Man company has great opportunities for capitalization and subsequent sale of shares.
Key facts:
- is on the OECD whitelist;
- Corporate tax rate is 0%;
- You do not need a payment agent, you can open a bank account and connect the processing directly to the gambling company.
Who regulates operators on the Isle of Man?
We cooperate with the Isle of Man Gambling Control Commission. The Commission was created in 1962 to protect the interests of gamblers on the island by ensuring that gambling remained fair and free of crime and that players received their winnings.
The Commission gained worldwide recognition with the emergence of online gambling in the early 21st century because of the island’s reputation as a tax-friendly jurisdiction.
The Isle of Man was one of the first jurisdictions to propose legislation to regulate gambling companies and create a safe sphere for players. One of the main documents underlying the Commission is the Online Gambling Regulation Act of 2001 (OGRA).
Types of Isle of Man gambling licenses
Unlike Curacao, the Isle of Man gambling licenses are divided into several types:
Full license (OGRA Basic License)
This is the basic standard license.
Full license holders can operate B2C, register their own players and store player information in their database. They can offer their White Label to other operators, providing them with a platform, content and other business solutions, and relieving them of the need to comply with the Isle of Man regulator themselves.
Holders of full licenses may also cooperate with other operators by offering them B2B games and software. In this case they are not responsible for the administrative and legal activities of such operators, but allow them to obtain a sublicense from the Commission. Holders of full licenses may have any number of sublicensees with an additional fee of 5000 GBP for each such partnership. A full license covers the activities of the company of the main licensee and its subsidiaries.
Sublicense
Operators who have no experience in the gambling industry, but plan to enter the market and open their own online casino, are likely to choose a sub-license.
This type of license is also a good option for a company that has a database of potential players, but does not yet have its own gambling products.
Sublicenses are granted on a reduced fee basis and bind the licensee to the holder of the full license by an exclusive agreement.
Registered sub-licensee players may have access to the software or games provided by the holder of the full license. Although a sub-licensee is bound to the holder of a full license, the sub-licensee may apply for its own full license at any time and become a fully independent licensee.
Network Services License
This license includes all the same rights and responsibilities as a full OGRA license, but owners of this type of license can host players registered in casinos licensed in other jurisdictions, skipping the re-registration process.
This way the owner of this type of license can quickly transfer player data from the source server to a server located on the Isle of Man without performing KYC or AML checks.
This type of license will be of interest to already licensed casinos, in order to quickly, seamlessly and legally migrate the player base.
B2B
A software provider license is not required to supply software to Isle of Man licensees. However, providers from around the world can benefit from the license because it gives them a prestigious reputation of an Isle of Man business network.
There are two types of software vendor licenses: one for standard fiat platform vendors and one for blockchain-based software vendors, which was added in 2019 under the Isle of Man rules for online gambling.
B2B vendor software must go through a testing process and be certified in order to be licensed. This software will be added to the GSC game registry, demonstrating to operators and players a commitment to high quality standards. This will also simplify the software integration process for Isle of Man licensees, because in this case, no additional certification is required.
License fees
| License type | One-time application fee for review | Annual license fee | ||
| Full license | 5000 GBP | 35000 GBP | ||
| Marketing | 5000 GBP | 5000 GBP | ||
| Network Services License | 5000 GBP | 50000 GBP + 5000 GBP per partner |
Types of gambling activities under the Isle of Man license
This license, like the Curacao license, covers all types of gambling activities and is issued for 5 years. The license is also suitable for projects based on blockchain and cryptocurrencies.
Isle of Man license requirements
Basic requirements for an applicant:
- The license can only be issued to a company registered on the Isle of Man;
- There is no restriction on the nationality of the ultimate beneficial owners of the company;
- It is mandatory that 2 local directors be appointed, who must be individuals, not corporate directors;
- Servers must be located on the Isle of Man or a Network Services License must be obtained;
- Corporate and PSP accounts must be opened on the Isle of Man;
- Player funds must be kept in segregated accounts.
Taxation
The corporate tax rate for companies on the Isle of Man is 0%.
Gambling activities are exempt from VAT, which means that while VAT is not charged on income, VAT is not refundable on expenses. This is worth paying attention to, as you may have to pay VAT to gambling software suppliers and other partners on the Isle of Man.
The VAT rate for the Isle of Man is 20%, but with proper structuring of VAT can be reduced (registration of another “service” company for VAT refund).
The Isle of Man gambling levy is based on profits, not turnover. The levy is paid at either “betting less winnings” or “retained earnings” depending on the type of gambling activity. With the written approval of the taxing authorities, an operator may be authorized to exclude payments to affiliates from the calculation of its fees.
Gross Game Yield (GGY)
- <£20m
- >£20м – <£40m
- >£40m
Gambling fee rate
- 1.5%
- 0.5%
- 0.1%
Project roadmap
4 weeks
- Company registration on the Isle of Man
- Appointment of two local directors
- Preparation of a business plan and package of documents for obtaining a license
- Opening a bank account for payment of state fees for the application
11-14 weeks (on average)
- Submission of the application and package of documents to the regulator for review
- Regulator review of the application
- Answers to Regulator questions
- License issuance
The basic list of documents required to obtain a license:
- Detailed business plan and description of target markets;
- Description of the games offered;
- RNG certificates for gambling software;
- Confirmation that the servers are located on the Isle of Man;
- UBO (beneficiary) no criminal record certificate;
- Copies of ID cards or UBO passports (not older than 90 days with translation into English and notarization);
- UBO bank statements (not older than 90 days, translated into English and notarized);
- UBO utility bills (not older than 90 days with English translation and notarization).
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