Cyprus, officially known as the Republic of Cyprus, is an island country situated in the Mediterranean Sea. It is a member of the EU and, as such, abides by the directives imposed by the Union. Most forms of gambling were not legalized until 2012. With the implementation of the Betting Law of 2012, land-based gambling became regulated in Cyprus, and this piece of legislation still governs gambling on the island.
To be able to conduct gambling activities in Cyprus, operators are required to apply for a license from the National Betting Authority. The gambling law of Cyprus has changed several times over the years, but online gambling remains largely unregulated. Because local authorities are not taking serious measures to prevent gambling on unlicensed websites, Cypriot players often resort to gambling with unregulated online operators.
Currently, the licensing body in Cyprus can issue two different types of gambling licenses to operators. The first authorizes land-based gambling activities, while the second covers the few legal forms of online gambling. Due to the ambiguous gambling definitions in Cypriot law, however, many unlicensed gaming and betting sites welcome players and punters from the country.
History of Gambling in Cyprus
Before most forms of gambling became legal in Cyprus, only a few activities were available to residents of the island country. In 1973, horse racing betting was legalized with the enactment of Law No. 48. Over the years, that law was amended several times, providing better regulation for horse racing betting in Cyprus.
Lotteries were also legalized on the island thanks to the Lotteries Law, enacted in 1983. It established the legal framework for the National Lottery and also banned private lotteries, with very few exceptions to the ban.
In 2004, Cyprus joined the EU, and because gambling was not regulated in the country at that time, online gambling operators licensed in other member states were often open to Cypriots as well. Such operations were possible on Cypriot territory thanks to the EU principle of the free movement of services.
At that time, Cyprus had not implemented any laws regulating the market, so officials regarded online gambling in the country as legal, and operations in Cyprus were the norm. In 2012, Cyprus implemented the Betting Law, which began regulating the gambling industry on the island.
Gambling is partially owned by the state, with private companies allowed to apply for licenses that permit certain forms of land-based gambling. The law also provided definitions that offered clearer differentiation between legal and illegal activities. The Betting Law also introduced the National Betting Authority, the body that regulates the gambling industry and issues licenses to operators in Cyprus.
An amendment to the Betting Law of 2015 legalized land-based casinos and gaming halls. At the beginning of casino licensing in Cyprus, the plan was to issue licenses only to a limited number of casino operators. It was also in 2015 that the Operation and Control of Casino Law was enacted, allowing any licensed casino operator to run up to four satellite casinos outside the casino resort owned by the licensee.
Gambling Regulations in Cyprus
As mentioned above, most forms of gambling in Cyprus were illegal until the enactment of the Betting Law in 2012. Today, this law remains the main piece of legislation governing the gambling industry in Cyprus. However, it has been amended several times to legalize additional forms of gambling and establish a clear regulatory framework.
Under the Betting Law, operators must obtain a license from the National Betting Authority, which was also created with the implementation of the law. While land-based gambling is legal in Cyprus, online gambling is largely prohibited, with only a few exceptions.
Because Cyprus is part of the EU, it must comply with Article 56 TFEU (the EU gambling directives). These directives state that operators from other EU countries should be able to apply for online gambling licenses and accept players from all member states. If a country does not issue such licenses, foreign operators should still be allowed to serve customers from that country without holding a local license.
At present, the law permits only sports betting licenses for online operations. This restriction conflicts with EU directives, prompting many international gambling companies to pressure Cyprus to amend its legislation.
Although the Betting Law was enacted in 2012, a 2015 amendment paved the way for legal brick-and-mortar casinos and gaming halls in Cyprus. The minimum legal gambling age is 18, yet many casinos allow entry only to guests who are 21 or older.
Land-Based Casinos and Slot Halls in Cyprus
Other Forms of Gambling Legal in CyprusOnline Gambling in Cyprus
While the island country has legalized various forms of gambling, online gambling is still not properly regulated by law. Currently, operators cannot apply for an online casino license or offer casino games to Cypriot players. The only exception to the ban on online gambling licenses applies to sports betting. Betting operators are allowed to apply for online sports betting licenses and legally operate virtual sportsbooks in Cyprus.
The company OPAP, which has monopolized the lottery industry in the country, has also been allowed to operate an online sportsbook. That being said, Cypriots often prefer to place their wagers with private betting companies that have also been licensed by the National Betting Authority. These companies typically offer a wider selection of sports and more competitive odds.
While online gambling with unlicensed operators is not legal under the current version of the Betting Law, many Cypriots still place bets on foreign gaming and betting sites. Since Cyprus is a member of the EU, it is required to comply with the gambling directives of the EU. Therefore, foreign operators based in other EU countries can accept customers from Cyprus without facing any legal consequences.
The Cypriot government is also not taking any serious measures to restrict the traffic to unlicensed gaming and betting sites. Although technically illegal, online gambling is becoming more popular in Cyprus, with recent studies showing that 22% of Cypriot youth are gambling online. These numbers surpass the average percentage of gambling participation among pupils in Europe (16%).
Gambling Regulator and Licensing in Cyprus
Whether they intend to offer online or offline gambling, operators requesting a permit to conduct a gambling business in Cyprus must apply for a license from the National Betting Authority.
As already mentioned, the Cypriot gambling authority issues two types of gambling licenses. The first, known as Class A, covers licenses issued to companies that operate land-based betting services, except for horse racing betting. This license is issued to brick-and-mortar casinos, slot halls, and land-based betting shops.
Because online sports betting is legal under the Cypriot Betting Law, the National Betting Authority can also issue a Class B license. This authorization enables operators to offer online sports betting services, with horse racing betting once again excluded.
The application fee for a license depends on its duration. For instance, if an operator applies for a Class A or Class B bookmaker license, the fee is €30,000 for one year or €45,000 for two years. The fee for a Class A license for an authorized agent is €2,000 for one year, €3,000 for two years, or €170 per month if the license is valid for less than a year. Lastly, the fee for a gambling premises license that permits operations in two or more venues is €2,000 for one year, €3,000 for two years, or €170 per month if the license is valid for less than one year.
Gambling Taxes in Cyprus
Both players and gambling operators in Cyprus are required to pay gambling-related taxes. The tax rates for the gambling industry are determined by the Law on the Taxation of Horse Racing Betting and Lotteries as well as the Betting Law. Winnings that players accumulate through gambling in Cyprus are considered taxable income, with the standard tax rate applied.
Licensed gambling operators must pay a general gambling tax of 13% on their gross gambling revenue. This 13% is broken down into a 10% tax plus a 3% mandatory contribution to charity. Two-thirds of the charitable contribution supports nonprofit and charitable organizations, while the remaining amount funds consumer protection programs and gambling addiction recovery.
There is also a 20% tax on winnings from betting and lotteries conducted by OPAP when winnings exceed €5,000. This tax is paid by the operator organizing the games or betting activities, not by the players. Meanwhile, casino operators must pay a 15% tax on gross gambling revenue.
Gambling businesses are also required to pay other types of taxes, such as a 25% corporate tax and VAT of 18%, levied on gambling, betting, and other types of wagering activities.
Closing Thoughts
Most gambling activities in Cyprus were not legalized until 2012. Thanks to the implementation of the Betting Law of 2012, however, the process of gambling legalization began, allowing operators to apply for licenses from the National Betting Authority. Even though the new law allowed some gambling operations, land-based casinos and slot halls were not legalized until 2015.
Thanks to an amendment in 2015, operators were allowed to apply for casino and slot hall licenses. Initially, the number of licensed casinos was very limited, but wealthy and influential individuals managed to obtain licenses for most major hotel resorts in the country. With permission to operate the so-called satellite casinos, the number of land-based gambling facilities in Cyprus rapidly increased.
While most forms of land-based gambling have been legalized in Cyprus, the country still does not allow operators to apply for online gambling licenses. Sports betting, however, is an exception, allowing betting companies to obtain an online betting license from the National Betting Authority. Cyprus’s refusal to legalize online gambling contradicts EU gambling directives. This results in an unclear legal status for online gambling and rising numbers of Cypriots playing on unlicensed offshore casino sites.