Online gambling has experienced considerable growth over the last decade, both in terms of participation and the range of available options. While many countries have passed legislation to regulate online casinos, some players still choose to take their play to offshore gambling businesses. The practice is also common among people who want to gamble remotely but live in jurisdictions that heavily restrict or outright prohibit online gambling.
The term ‘offshore casino’ refers to a gambling website that operates from a jurisdiction outside your own, often in contravention of local laws and regulations. Such businesses hold licenses issued in foreign jurisdictions with lenient regulations and lower levels of consumer protection compared with domestically licensed operators.
Offshore-licensed gambling companies do not participate in the economies of the countries where they operate. They do not pay taxes on the revenue they generate from local players because they effectively serve them without authorization from domestic regulators.
While not all offshore operators are fraudulent, there are still some risks you should be aware of before you start gambling on such websites. First, let’s examine the most common licensing jurisdictions for offshore casinos.
Licensing Jurisdictions for Offshore Online Casinos
One widespread misconception about offshore casinos is that they operate without any licenses at all. While this is true for some websites, most offshore gambling businesses obtain licenses from the authorities in the countries where they base their operations.
If they set up shop in a given jurisdiction without authorization, they risk being prosecuted. The issue is that most offshore casinos obtain licenses from countries with low tax rates and more lenient regulatory oversight, such as Costa Rica and Panama. These jurisdictions generally have no problem with their licensees serving customers from gray markets.
Costa Rica
Antigua and Barbuda
Curacao
Panama
Costa Rica
Why do operators choose this jurisdiction?
- Nearly non-existent regulations
- Low tax rates and absence of annual license fees
- No requirements for software audits
- Quick and hassle-free start of operations
Located in Central America, Costa Rica has licensed more than 400 online casinos and sportsbooks to date. However, it lacks specific legislation governing remote gambling. Operators that want to set up shop in the country must obtain licenses for data processing rather than actual online gambling permits.
The only conditions these companies must meet are that they have physical offices registered in the country and do not offer their services to Costa Rican residents. Local laws allow this arrangement because the wagering activities are considered to occur outside Costa Rica even though the casinos’ servers are physically located there.
No annual licensing fees or taxes are imposed on revenue generated outside Costa Rica. Operators can register and launch their websites in roughly three weeks. In the absence of regulatory oversight, Costa Rican operators are not even required to test their gaming software for fairness.
Antigua and Barbuda
Why do operators choose this jurisdiction?
- A respected licensing jurisdiction in the Caribbean region
- A single interactive gaming license covers a broad range of gambling products
- Low fees for interactive gaming licensees
Located in the West Indies, this island country has issued remote gambling permits since 1994. It has established itself as one of the most popular licensing jurisdictions in the Caribbean. Wagering activities are regulated by the Directorate of Offshore Gambling, which operates under the local Financial Services Regulatory Commission (FSRC).
The Directorate grants two types of permits. The first is an interactive wagering license issued to remote sportsbooks. The second is an interactive gaming license that covers a wide range of products, including online casino games, slots, poker, and lotteries.
Regulatory oversight here is stricter because Antigua and Barbuda is part of the British Commonwealth of Nations. The jurisdiction attracts offshore operators with its low tax rates. Annual fees for interactive gaming licensees stand at $100,000 and do not fluctuate based on yearly revenue.
Curacao
Why do operators choose this jurisdiction?
- License requirements are friendly to small startup companies
- Interactive operators can quickly obtain licenses (within 2 to 4 weeks)
- Master licensees can distribute white-label sub-licenses to other companies
- Some of the lowest tax rates in the world
- Licenses are all-inclusive and cover multiple gambling products
Located in the southern Caribbean, Curacao was part of the Netherlands Antilles until the latter dissolved in 2010. The jurisdiction has been issuing remote gaming licenses since the early 2000s and has become a recognized name worldwide.
To obtain a license, applicants must register their companies in the country, provide ownership information, and work with a local representative. At least one server of the online gambling business must be physically located in Curacao.
Companies holding master licenses can lease them to other operators as white-label permits. Additionally, Curacao offers some of the lowest gambling taxes in the world. Licensed companies are taxed at only 2% of their net profits.
Panama
Why do operators choose this jurisdiction?
- Low initial licensing and renewal fees
- Online operators are exempt from taxation
- Limited liability and lenient regulation
Panama began licensing online gambling in the early 2000s. Offshore operators seeking a Panamanian license must file their applications with the Gaming Control Board, part of the local Ministry of Economy and Finance.
Licensees must meet only a handful of requirements. Remote operators enjoy full tax exemption provided that they do not accept wagers from Panamanian players. Applicants must have a locally registered company and demonstrate sufficient financial capacity.
The application fee is just $1,000. Successful applicants must then pay an initial licensing fee of $40,000. Interactive gaming permits are valid for seven years, and operators can renew them for $20,000 at the end of this period.
Difference #1: Bonus Size
Difference #2: Serviced Markets
Difference #3: Range of Software Suppliers
Difference #4: Country Restrictions
Difference #5: T&C Language
Difference #6: Payment Methods Range
Difference #1: Bonus Size
Although there are exceptions, most offshore casinos bombard players with a barrage of promo codes the moment they access the site. These operators tend to offer massive bonuses, sometimes worth several thousand dollars.
However, the offers often come with wagering requirements that are nearly impossible to meet and multiple restrictions that keep players from realizing their full value. By contrast, domestically regulated operators offer fewer promotions but with player-friendly conditions, lower playthrough requirements, and fewer game-related restrictions.
Difference #2: Serviced Markets
In some countries, legislation lacks specific provisions on online gambling, neither outlawing nor permitting such activities. Offshore operators often exploit these legal loopholes and accept real-money play from gray markets, arguing that they are not technically violating the law. Some even allow registrations from black markets whose laws expressly prohibit online gambling.
Conversely, highly regulated gambling businesses offer their services only in the countries where they hold licenses. Such companies usually obtain separate permits for every jurisdiction they serve. For example, they accept EU players with MGA licenses, British players with UKGC licenses, and New Jersey customers with DGE permits.
Difference #3: Range of Software Suppliers
Many offshore operators work with only a handful of suppliers because more gaming software companies are transitioning to regulated markets. This results in a significantly smaller library of casino games from fewer providers, usually RealTime Gaming (RTG), Betsoft, Rival, and WGS Technology.
By comparison, strictly regulated casinos typically offer thousands of games from dozens of software studios, including renowned brands that hold licenses in multiple markets. Examples include NetEnt, Evolution, Microgaming, Quickspin, and Playtech, among many others.
Difference #4: Country Restrictions
Most offshore casinos operate globally, listing only a few prohibited countries in their terms and conditions. Access is usually restricted solely from jurisdictions with zero or little tolerance for offshore gambling businesses that lack domestic licenses. Common examples include France, Great Britain, the Netherlands, and the United States.
Some offshore casinos accept real-money bets from US customers, restricting only players from states with stringent regulations such as New Jersey, Nevada, New York, and Maryland.
By contrast, domestically regulated operators generally impose multiple country restrictions because they accept action only from jurisdictions that have granted them authorization.
Difference #5: T&C Language
Although exceptions exist, some offshore casinos use ambiguous, unclear, and misleading language intended to confuse customers.
This practice often causes players to violate the terms of use or bonus rules, leading to terminated accounts, withheld funds, denied payouts, and other nuisances.
By contrast, domestic regulators such as the UKGC and the DGE require licensees to use clear and direct language when outlining their terms of use and bonus conditions to prevent misunderstandings.
Difference #6: Payment Methods Range
Players at offshore casinos often face a limited range of deposit and withdrawal options because many jurisdictions, including the United States, prohibit local banks from processing payments to unauthorized gambling businesses.
As a result, US players frequently have their card payments declined and cannot use e-wallets such as PayPal at offshore casinos. The available alternatives are generally limited to solutions like bank wire transfers, checks, gift vouchers, and decentralized cryptocurrencies like Bitcoin.
Common Risks Associated with Offshore Casinos
We would like to emphasize that not all offshore-licensed online gambling businesses are fraudulent. On the contrary, some have operated successfully for many years, boast thousands of satisfied customers, and have received very few consumer complaints.
With that in mind, we regret to say that there are indeed some bad seeds out there. Some offshore casinos exploit the lenient regulations of the jurisdictions that license them, which can result in various issues for players, including those described below.
Separating the Wheat from the Chaff
We mentioned this earlier, but it is worth reiterating: An offshore license does not necessarily indicate a rogue operation. Many gambling businesses licensed in the above-mentioned jurisdictions care about their reputation and protect it through transparency and fair treatment.
Nonetheless, there are some rotten apples in the barrel, and you should learn how to spot them if you plan on playing at offshore casinos. Spare yourself the trouble and review the checklist below. If your chosen offshore casino (or any casino, for that matter) checks off most of these boxes, you should play elsewhere for your own sake.
- Excessively generous bonus offers with impossible-to-meet terms and conditions
- Obscure or deliberately confusing language in the general terms of use
- Impolite, unprofessional, or consistently inefficient customer support representatives
- Complete absence of any licensing or regulatory information
- Very high withdrawal limits paired with multiple restrictions on payouts
- A consistent record of slow or denied withdrawals
- Poor feedback and multiple complaints from fellow players
- Generally unresponsive to complaints
- Absence of a dispute resolution service that players can use to settle issues
- Blacklisted by multiple online casino review portals
