Informally known as Czechia, the Czech Republic is a landlocked European country encompassing the historical regions of Moravia, Bohemia, and Czech Silesia. The country was part of the Eastern Bloc under the influence of the Soviet Union until 1989, when it transitioned to a liberal democratic regime. Today, the Czech Republic boasts membership in the EU and a thriving economy whose performance is driven mainly by the manufacturing, services, and agriculture sectors.
The country had several forms of legal gambling during its communist period, including government-controlled horse and sports wagering, lotteries, and scratch cards. Slot machines and casino gambling became legal in the Czech Republic toward the end of the communist era. Remote lotteries and online sports wagering became legal in 2012, but it was not until 2016 that the country legalized other forms of online gaming.
Gambling is a popular recreational activity among Czech residents, which is unsurprising considering the country had 299 brick-and-mortar casinos as of 2017. Estimates also suggest Czechia ranks second worldwide in terms of the number of slot machines per capita. This is hardly surprising, as the country is one of the largest slot machine manufacturers in Europe.
The local gambling industry has experienced consistent growth over the past decade, with casino gaming revenue increasing from €136 million in 2010 to €240 million in 2017. Czech players can legally enjoy various forms of casino gambling, including slots, roulette, baccarat, and blackjack. Poker is also hugely popular in the Czech Republic, so much so that the capital, Prague was chosen as a stop on the PokerStars EPT tournament series.
Czech gambling regulators have introduced various changes over the last few years, including a registry of excluded persons and higher tax rates. Stick with us as we explore Czech gambling legislation in more detail.
Laws That Govern the Czech Gambling Industry
During Czechia’s communist period, the only legal forms of gambling were state-owned lotteries, scratchcards, and the totalizator. The landscape changed following the passage of Act № 202/1990 Coll. on Lotteries and Other Similar Games, which legalized brick-and-mortar casino gambling in the country. More than two decades later, in 2012, lawmakers amended the legislation to permit remote sports wagering and online lotteries.
The Czech Gambling Act of 2016
Licensing Requirements
The Czech Gambling Act of 2016
However, other forms of online gambling did not become legal in the Czech Republic until 2016. The main piece of legislation that currently governs land-based and remote gambling in the country is Act № 186/2016 Coll., also known as the Czech Gambling Act. The law provides a legal definition of gambling, describing it as any game, betting activity, or lottery in which participants must stake money and the outcome is fully or partly based on chance.
Players’ winnings are generally monetary, with only a few exceptions. Examples include the so-called supplemental and immediate (instant-win) lotteries, where winners can receive non-monetary prizes. Act № 186/2016 governs the following types of gaming and betting activities: bingo, raffles, lotteries, tote wagering, smaller tournaments, casino games, and slot machines. Social games and loot boxes remain unregulated in the country.
Licensing Requirements
All legal forms of gaming are available in both terrestrial and online formats. Online operators require licenses from the Czech Ministry of Finance, which regulates remote gambling businesses. Land-based firms must obtain authorization from the Ministry, the Customs Office, and the authorities of the municipalities in which they intend to operate. The municipalities must then issue additional premises location licenses to such applicants.
The basic online license covers all permitted forms of gambling except smaller tournaments and raffles. Each interested company must pay a Kč5,000 fee when submitting its application. The Czech Republic does not implement a single-license regime, as is the case in Colombia, for example. Instead, each permitted gambling activity requires an individual permit.
For instance, if a company seeks to provide fixed-odds betting, video gaming terminals, and live games, it must apply for three separate basic licenses. Raffles and small tournaments are the only exceptions because they require only formal notifications to the municipal authorities where they take place.
License applicants must provide proof to the Ministry of Finance that they have no criminal record or outstanding debts. Online operators must also present documents verifying the location of their servers. Another condition applicants must meet is to have registered offices in the country or in another member state of the European Union (EU).
The minimum equity requirement they must meet is €2 million, and the origin of the funds must be fully transparent. Some requirements concern personnel: the applying company should employ at least five staff members with three or more years of industry experience.
In the context of land-based gambling, this means a person should have been a professional dealer for at least three years to operate table games like roulette or blackjack. Applicants must deposit a financial surety in a bank account designated by the Ministry of Finance. The amount varies depending on the type of gambling activity.
For example, the guarantee for horse and greyhound race betting is Kč5 million, while that for land-based lotteries is Kč50 million. The minimum surety requirements for each land-based card room and casino are Kč1 million and Kč10 million, respectively. Applicants who have declared insolvency within the last three years cannot obtain operating permits.
Basic gambling licenses have a maximum validity of six years. In the event of an acquisition, the successor company must obtain approval from the Ministry of Finance beforehand. If licensees violate any licensing conditions, the Czech gambling regulator may suspend or revoke their permits.
Social Responsibility Policies in the Czech Republic
The Czech gambling watchdog is strict about compliance with its social responsibility requirements. Under local regulations, gambling operators may offer their products only to customers aged 18 or older, as this is the age of majority in the country.
For online gambling, all players must register accounts and provide licensees with identification documents that confirm they are legally old enough to gamble. Part IV, Title I, Article 77 of Act № 186/2016 stipulates that all online players must set self-restrictive measures when they register.
Responsible Gambling Measures
The Excluded Persons Register
Policies for Landbased Operators
Responsible Gambling Measures
The self-restrictive measures in question include daily and monthly limits on deposits, net losses, and wagers. Czech players can also set a limit on the number of times they log in to their accounts each calendar month. Customers may increase their limits, but any increase will take effect no sooner than one week after the request.
If a player wishes to decrease a limit, the change is applied either instantly or within 24 hours of the request. Czech players can also restrict the amount of time they spend logged into their accounts. Locals who play in brick-and-mortar casinos can limit the number of visits they make to the respective gambling premises each month.
The Excluded Persons Register
The Czech Ministry of Finance maintains a register of persons excluded from gambling participation, which is available to both operators and the public. The Ministry piloted the exclusion registry in September 2020 after an amendment to Act № 186/2016. The regulator gave licensed operators until December of the same year to ensure that all listed individuals had no access to wagering.
Self-exclusion aside, the Ministry itself has the authority to add individuals to the registry. People who receive destitution or welfare benefits from the government generally cannot participate in gambling activities, for obvious reasons. The only exception is for those who require extraordinary and immediate financial assistance. Gambling is also off-limits to residents who have declared bankruptcy.
In line with Act № 40/2009, residents who are undergoing gambling addiction treatment are also placed on the registry even if they have not requested exclusion themselves. Naturally, people who feel their betting has become problematic can always request an entry even if they are not undergoing addiction treatment.
Policies for Landbased Operators
Czech law expressly prohibits gambling in schools, churches, leisure centers intended for minors, and health-care facilities for both outpatients and inpatients. Licensed brick-and-mortar operators are not allowed to provide any benefits to their patrons in connection with gambling. In many countries, casinos treat customers to free drinks.
But Czech gambling establishments are an exception because local regulations prohibit them from offering food, beverages, or tobacco products to their patrons. Some time ago, there was speculation that Czech authorities were considering prohibiting locally licensed gambling sites from offering promotions to Czech players.
The main argument was that such incentives could cause gambling-related harm by encouraging players to gamble more. It appears regulators have since abandoned this idea. After checking several Czech-licensed websites such as Sazka, Fortuna, and Synot Tip, we found that all of them offer bonuses to local players, with detailed terms and conditions in the Czech language.
Gambling Advertising Requirements in the Czech Republic
The marketing of gambling activities falls under the scope of Act № 40/1995 on the Regulation of Advertising. Its provisions prohibit the advertising of unauthorized gambling products that lack operating permits granted by the Ministry of Finance. Licensed operators can market their services, but with some restrictions. Ads must not leave people with the impression they can use betting as a source of income, for example.
Accordingly, marketing materials should not target or appeal to underage individuals and must make it clear that minors cannot take part in such activities. Each ad must contain a warning stating that frequent and irresponsible betting may lead to gambling addiction. Similar restrictions are in place for land-based gambling operators.
The Advertising Act disallows promotional messages and materials on the exterior of brick-and-mortar gaming venues. Meanwhile, the interior of the betting premises should not be visible to passersby from the outside. All casinos, card rooms, and betting shops should be clearly designated as such.
Sanctions for Violating Act № 186/2016
Some offshore operators serve Czech players without licenses issued by the Ministry of Finance. The regulatory watchdog works to impede such businesses by maintaining a blacklist of unauthorized gambling sites. Czech internet service providers (ISPs) have been instructed to restrict access to unlicensed operators.
ISPs that fail to comply also risk sanctions from the local authorities. The same applies to local payment service providers, who must block financial transactions to and from blacklisted gambling sites. Local companies that contravene the provisions of Act № 186/2016 risk various penalties, including license suspension or revocation, gambling equipment confiscation, and administrative fines of up to Kč50 million.
The heaviest sanction violators face is imprisonment for a maximum of ten years, depending on the severity of their contravention. Such criminal sanctions are enforced under the provisions of the Czech Criminal Code (Article 252) and Act № 418/2011 on the Criminal Liability of Legal Entities and the Proceedings Against Them. Last but not least, players should be aware that gambling debts are enforceable under Czech law, but only if the debt is owed to an authorized gambling business.
Conclusion
As you can see, the Czech Republic is very strict when it comes to enforcing gambling regulations. The tougher regulatory climate and the relatively high taxes on certain betting activities have caused large gambling operators like William Hill to exit the Czech market.
Despite these strict rules, gambling remains a widespread form of entertainment in the country. Because of the limited number of locally licensed online operators, many Czechs turn to offshore betting sites and are generally not prosecuted for doing so.
Responsible Gambling Measures
The self-restrictive measures in question include daily and monthly limits on deposits, net losses, and wagers. Czech players can also set a limit on the number of times they log in to their accounts each calendar month. Customers may increase their limits, but any increase will take effect no sooner than one week after the request.
If a player wishes to decrease a limit, the change is applied either instantly or within 24 hours of the request. Czech players can also restrict the amount of time they spend logged into their accounts. Locals who play in brick-and-mortar casinos can limit the number of visits they make to the respective gambling premises each month.