Portugal, officially known as the Portuguese Republic, is a southwestern European country with a long gambling history. One of the oldest and largest casinos in Europe is Casino Estoril in Portugal. It was founded in 1931 by Portuguese businessman Teodoro dos Santos.
Another famous casino in Portugal is Casino Póvoa de Varzim, which was opened in 1934. Along with Casino Estoril, it is one of Portugal’s greatest architectural treasures and is still operating today. Both casinos are part of the prestigious casino group Estoril Sol. Currently, the country hosts 11 casinos where both locals and tourists can enjoy a wonderful gaming experience.
Tourism and the gambling industry in Portugal go hand in hand, generating a large portion of the country’s revenue every year. While gambling has been legal in the country for many years, Portugal has introduced several amendments to its gambling laws to adapt to the current gambling environment, which requires updated regulatory measures.
One of the latest changes to Portuguese gambling laws introduced the regulation of online gambling. This amendment fully legalized virtual casinos and sportsbooks, which are overseen by the Regulatory and Inspection Services of Games and Tourism of Portugal. As the two sectors are often interdependent, it is no surprise that the same regulatory body controls both tourism and gambling activities in Portugal.
Gambling Regulations
Portuguese residents are able to legally enjoy various forms of gambling. Currently, they may participate in fixed-odds sports betting, horse race betting, and a range of games of chance. Regulated games of chance include baccarat, French Banque, blackjack, bingo, slot machines, poker tournaments, non-banked poker variations, Caribbean Stud poker, American roulette, and French roulette.
Several laws govern gambling in Portugal. Until the 20th century, almost all types of gambling were illegal in Portugal. Games of chance were first legalized in 1927, and the first law regulating land-based casinos dates back to 1989.
Although the law sets no stake, jackpot, or rollover limits, it requires operators to impose certain restrictions to encourage responsible gambling. The legal gambling age in Portugal is 18. Gambling-related advertising is permitted provided it protects minors and vulnerable groups. False claims about easy monetary winnings, guaranteed success, higher social status, or special skills related to gambling are prohibited. Advertisements that focus on entertainment and do not encourage excessive play are considered legal under the Gambling Law of Portugal.
Providing gambling services to minors, as well as promoting gambling activities in schools or other facilities that serve minors, is strictly prohibited. Using underage individuals in gambling advertising is also illegal.
Land-Based Gambling in Portugal
Online Gambling in PortugalGambling Regulators in Portugal
The Gambling Regulation and Inspection Service (SRIJ) is one of the regulatory bodies that oversee gambling activities in Portugal. The responsibilities of the SRIJ include overseeing, inspecting, and regulating land-based gambling activities, including casinos and bingo halls. The SRIJ also regulates online gambling activities in Portugal.
The SRIJ works with police authorities to prevent illegal gambling practices involving land-based casino games, poker, and bingo. The regulator also collaborates with other authorities to prevent and penalize any illegal online gambling activities.
The other regulator in Portugal is the Lisbon Holy House of Mercy (SCML), which is a state-funded public entity. It is responsible for the regulation of state-run games such as the National Lottery, offline fixed-odds sports betting, and offline mutual horse race betting. State-run land-based games are strictly operated by SCML representatives, but they may also be offered by other venues, provided that they have obtained a valid license.
Gambling Licenses
To be able to obtain a land-based casino or bingo license, operators have to go through a public tender procedure. There are no limitations on the number of licenses that operators can be granted. However, the concessions issued depend on the public tenders launched by the local authorities.
There is no set time frame for the licensing process as every public tender has its specific time limit. A member of the tourism sector within the current government approves the public tender, identifies the license applicants, grants the licenses, and approves any additional drafts of the gaming license agreement.
The duration of the land-based gaming license is determined during the public tender process. Typically, this type of license is valid for 10 to 20 years, depending on whether the operator applies for a casino or bingo license. The cost of land-based gaming licenses is also determined by every public tender and may differ according to the type of license.
As mentioned earlier, operators can receive casino/bingo licenses only for certain areas in Portugal. This being said, it is possible to receive a special license allowing some games of chance to be offered on ships, aircraft, or other locations that are visited by a high number of tourists.
To receive a land-based gaming license, operators must be registered as a limited liability company or an equivalent form recognized in the European Union (EU) or the European Economic Area (EEA). Companies that are not registered in Portugal must at least have a branch located in the country. Operators that receive a license have to comply with the minimum asset cover ratio that is specified in the Gambling Law. At any time, the licensor must be able to identify 60% of the company’s shareholders.
There are four types of licenses that can be obtained by operators that wish to offer online gambling services to Portuguese players. These include licenses for fixed-odds sports betting, totalisator/pari-mutuel and fixed-odds horse race betting, bingo, and games of chance.
There is no limit to the number of online gaming licenses that can be issued to operators who wish to offer online casino, bingo, sports betting, or any other type of online gambling. To be eligible to receive an online gaming license, operators must be registered as a limited liability company or any other equivalent in the EU or EEA. If a company is not registered in Portugal, it must at least have a branch in the country. Applicants must have their tax and social security affairs in order in Portugal or in the state where the operator’s headquarters are located.
Another condition that operators must meet is to prove that they have the financial capacity to operate under the Gambling Law of Portugal. Operators applying for an online gaming license must submit a plan for their gambling technical system and must state that they will provide gambling services.
To apply for a license, operators must fill out the standard application form that has been approved by SRIJ. They should also provide the required documents, proving they will comply with the aforementioned requirements. Usually, the entire licensing process takes between 6 and 18 months.
Online gaming licenses are valid for three years and operators have the opportunity to extend their licenses by another three years. The initial license approval fee is €18,000, plus an additional €2,000 for every type of betting category the operator is licensed to provide. If the operator seeks authorization for any game of chance not included in the original license, a fee of €2,000 will be charged for each additional game of chance.
Extending the validity of an online gaming license costs €12,000 for fixed-odds sports betting, totalisator/pari-mutuel and fixed-odds horse race betting, and games of chance. The renewal of an online bingo license costs €2,000.
If an operator is approved for a license, the applicant must also pay a fee of €500,000 as a guarantee of legal obligations and a special gambling tax of €100,000. Both of these deposits are paid to SRIJ.
Gambling Related Tax in Portugal
Thanks to the latest amendment of the online gambling tax regime in March 2020, the progressive rate was eliminated. Different types of gambling activities incur different taxes. Casino games offered in land-based facilities, including bingo and poker games, incur an IEJ gambling tax. It varies depending on the location where the casino games are offered and it can be anywhere between 4.5% and 40% of the casino games’ Gross Gaming Revenue (GGR). Betting in bingo halls is subject to a Stamp Duty of 25%. This tax rate applies to both traditional and electronic bingo halls.
The tax that is applied to online gambling is known as IEJO and it varies according to the form of the gambling activity. Games of chance, including bingo and poker, incur an IEJO tax of 25%. While the tax rate for games of chance is applied to the GGR, the IEJO tax for bingo and poker is levied on the fees collected by operators.
Pari-mutuel horse racing bets impose an IEJO levy of 25% on the GGR. The tax for fixed-odds sports betting is 8%, and it is levied on the revenue from placed bets. When revenue is generated solely by fees collected on fixed-odds sports betting or fixed-odds horse racing, where punters bet against each other, an IEJO tax of 35% is levied on these fees.
While prize money is not subject to any taxation, state-run games impose a Stamp Duty of 4.5% on the bet amount and 20% on the prize amount if it exceeds €5,000. The only exception is pari-mutuel horse race betting, which imposes an IEJ tax of between 15% and 30% on the GGR.
Responsible Gambling in Portugal
Operators authorized to offer gambling services in Portugal must ensure the integrity, security, and reliability of the type of gambling they provide. They are required to inform players about the risks of gambling and to provide adequate tools that support responsible and safe gambling.
Before authorized operators launch their services, they need to provide a plan that includes several key matters. An operator is required to offer general information about the company and the form of gambling activities it will provide. Another requirement is to provide players with information about responsible gambling and the risks of gambling addiction. This includes a permanent responsible gambling warning on the operator’s website.
The Portuguese law requires gambling operators to incorporate protective tools that will prevent access to minors and vulnerable players who have chosen to make use of self-exclusion features. Gambling operators should also provide players with options to set deposit and wagering limits. Self-exclusion and timeouts should also be available to players who wish to control their gambling patterns.
Closing Thoughts
Portugal has a long gambling history, with some of the oldest land-based casinos in Europe located in the country. Different forms of gambling have been legalized in Portugal, giving fans of casino games, sports betting, lottery, and bingo the chance to bet both offline and online.
The two primary pieces of legislation that regulate the gambling industry in Portugal are the Gambling Law of 1989, also known as Decree-Law No. 422, and Decree-Law No. 66 of 2015. Under these laws, both online and land-based gambling are permitted in Portugal.
There have been several amendments to the gambling law of the country, the latest being in 2020. Thanks to the recent change in the legal framework, the progressive tax rate was eliminated. However, it is expected that a new amendment may be passed within the next two years, or perhaps sooner.