How to get a gambling license in Alderney in 2022

icon-author Petr Stehlik 📅 Updated 2 June, 2021 🕐 12min. 👁 7547
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The Alderney Gambling Control Commission’s high standards, low costs, and simple licensing structure have made it one of the world’s most respected licensing authorities. Read on to learn how the AGCC license can take your iGaming business to the next level. 

Online gambling licensing and regulation in Alderney 

The Alderney Gambling Control Commission is one of the iGaming industry’s leading regulatory bodies and licensors. Since its foundation in May 2000, the AGCC has consistently ensured that the island’s gambling regulations keep up with the rapidly changing industry. 

The Channel Island of Alderney is a British Crown dependency with its own political and legislative systems. Though the island is a possession of the Crown, the AGCC is entirely independent from the United Kingdom Gambling Commission. Alderney is a part of the Bailiwick of Guernsey, which is responsible for the island’s tax and financial framework, and enjoys the same modern telecommunication networks and hosting facilities as Guernsey.

With extensive regulations, reasonable licensing fees, and no gaming duties, corporate taxes, or VAT, authorities have created a pro-business, gambling-friendly environment for iGaming operators. 
How to get a gambling license in Alderney in 2022 0

What kind of licenses does Alderney offer?

The AGCC offers Category 1 and Category 2 Licenses and Associate Certificates, as well as a temporary license. 

Licenses are issued to companies based in Alderney, whereas Associate Certificates are issued to foreign-based companies. Both Licenses and Associate Certificates afford the holder equal abilities, the only difference is that Certificates are granted to companies registered abroad, and Licenses are for those incorporated in Alderney

The Category 1 (B2C) License or Associate Certificate enables the holder to organize all types of gambling activities and conduct all other aspects of player management, such as ID verification and the management of player funds. The Category 1 license is primarily sought by operators.

The Category 2 (B2B) License or Associate Certificate covers all aspects of gambling transactions, such as providing games and betting activities. The Category 2 license is primarily sought by software providers. 

The AGCC also offers a Temporary license for operators licensed in another jurisdiction, allowing them to organize gambling activities for a limited period of time.A Temporary eGambling license has the same obligations and privileges as a full eGambling license, except as detailed by law or regulation or as specifically exempted by the Commission.

Temporary licenses are valid for 29 continuous days or for a total of 59 days within any six-month period. On the 30th day of continuous use or the 60th day of aggregated use within any six-month period, the Commission will require the licensee to apply for a full eGambling license within 42 days.

What are the benefits of an Alderney eGambling license?

There are a range of advantages to the Alderney eGambling license:

  • Player trust: The AGCC license gives users a reason to have confidence in your platform.
  • International recognition: Software developers, payment providers, and other B2B companies will be more inclined to cooperate with your business if you hold an Alderney license.
  • Cost-effective: The government levies no VAT or any other taxes. 
  • Risk-based regulation: Companies only need to comply with regulations that are pertinent to their operations.
  • Simple licensing structure: One license covers all types of gambling activities.

How to apply for an Alderney gambling license

The application process moves through several stages and lasts for a minimum of four weeks. Applicants often engage professional assistance to avoid mistakes that could result in the rejection of an application. 

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If an application is successful, a license will be issued. However, before the casino starts operation, the AGCC needs to approve the internal control system, gambling equipment, and capitalization status of the prospective business. 

The stages of the application process will look like this:

Stage 1 - Application form and documentation are submitted and the investigation deposit of £10,000 is paid (if applying for a Category 1 or 2 License, the applicant will also register a company in Alderney).

Stage 2 - The AGCC commences their investigation. Applicant suitability testing is undertaken (character, business reputation, financial position, ownership and corporate structure, reputation of business associates, and source of funding checks).

Stage 3 - A meeting is arranged with the Director of Regulatory Operations wherein the applicant will provide information regarding: 

  • Their business plan and proposed egambling operations.
  • Their potential business and executive associates, such as external software providers.
  • Any corporate entities who may be involved in the operation.
  • Persons who may need to apply for key individual certificates.

Stage 4 - The license is granted by AGCC upon payment of the full license fee (however, no operations may commence until Stage 5 is completed).

Stage 5 - Testing of gaming equipment, including approval of ICS (Internal Controls Systems).

Stage 6 - Once your application is completely approved, business operations may commence.

The application process for a Temporary License is similar: 

Stage 1 - The applicant submits a fully completed and signed copy of the application form to the AGCC and pays an initial investigation deposit of £5,000.

Stage 2 - Following receipt of the application, the applicant company will meet with the Executive Director to present:

  • The business plan, including the potential use of the temporary license.
  • Potential involved parties, including external software providers.
  • The corporate entities which are involved in the application.

Stage 3 - The AGCC assesses the application.

Stage 4 - The commission decides if the application is accepted or rejected.

Stage 5 - If the application is successful, the Temporary license is issued upon final payment of the required fee.

Before a licensee can begin accepting players, the AGCC will conduct the same inspection of the internal control system, gambling equipment, and licensee’s capitalization status as with other license applications. 

For all eGambling Licenses and Associate Certificates, the licensee must maintain proper capitalization status at all times during its operations. Capitalization status is assessed via three criteria:

  • Whether cash exceeds player balances.
  • Whether current assets exceed current liabilities.
  • Whether total assets exceed total liabilities by 25%.
How to get a gambling license in Alderney in 2022 1

How much does a gambling license from Alderney cost?

Unfortunately, like when applying for most other gaming licenses, there is no straightforward final figure. The total cost will depend on a number of factors and vary from case to case.

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The table below outlines all of the associated costs for both licenses, including renewal costs and various other price tiers depending on your business’ performance.

Alderney Licenses and/or Associate Certificate

Category 1 License/AC:

Category 2 License/AC:

Temporary

License:

New application fee:

  1. No license in Alderney: £17,500
  2. Another license in Alderney: £35,000
  1. No license in Alderney: £17,500
  2. Another license in Alderney: £35,000

£10,000

 

(£5,000 initial deposit required before approval)

Annual renewal cost of licenses:

 

(Known as “Bands A - G” by the AGCC for Category 1 Licenses)

 

(NGY = Net Gaming Yield)

  1. NGY < £500,000: £35,000
  2. NGY £500,000 - £1 mln: £60,000
  3. NGY £1 mln - £5 mln: £80,000
  4. NGY £5 mln - £7.5 mln: £130,000
  5. NGY £7.5 mln - £20 mln: £200,000
  6. NGY £20 mln - £30 mln: £290,000
  7. NGY exceeds £30 mln: £400,000

For the renewal of any Category 2 License by a licensee: £35,000

£10,000

Annual gambling business association fee:

£3,000 per gambling business associate.

£3,000. per gambling business associate.

If a Category 2 license holder is also in possession of a Category 1 license, fee calculation excludes any associate already counted under the Category 1 License fee. 

£3,000 

Other licensing fees, such those for Key Individual Certificates, Modification Fees, and Core Services Associate Certificates, may apply. Other potential costs include application modification fees, hosting fees, gambling equipment inspections, or penalty fees.

It is important to remember that Category 1 & 2 Licenses are issued for 1 year. 

The corporate tax rate for Alderney is 0% and there is no additional gaming tax.

Applicants for the Associate Certificate are not required to have a physical presence in the Bailiwick. However, a resident agent and registered office is a requirement for Alderney companies and a resident representative is a requirement for the Category 1 Associate Certificate.

Why do you need a license?

Some operators decide that the costs of licensing and taxes are too high and try to save money by skipping the license. However, while this may present short-term gains, the potential costs are far greater than any fees or taxes could ever be. Consequences such as fines, criminal charges, or even prison time will easily outweigh licensing fees. 

How do the Alderney and Isle of Man licenses compare?

The Isle of Man, another Crown dependency, also has a licensing scheme for online gambling. Here is a comparison table of the two licensors’ conditions:

Comparing licenses:

Isle of Man

Alderney:

Types of license:

By business model:

 
  • Full License 
  • Sub-License 
  • Network License 
  • Supplier License

Three types, covering all activities:

 
  • Category 1 (B2C license)
  • Category 2 (B2B license)
  • Temporary license

 

Products covered:

One license covers all

One license covers all

Markets covered:

All those not regulated by local authorities

All those not regulated by local authorities

Application fee:

All licenses: £5000

Category 1 and 2: £10,000 investigation deposit

 

Temporary: £5000 investigation deposit

License fee:

Fixed for each type:

 
  • Full License: £35,000
  • Sub-License: £5,000
  • Network License: £50,000
  • Supplier License for standard platform providers: £35,000
  • Supplier License for blockchain enabled platform providers: £50,000

Starting at £17,500.

 

See table above for a breakdown of costs.

Application processing time:

10-12 weeks 

Minimum of four weeks

Tax rate:

0.1%-1.5% on GGY

0%

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Are there any disadvantages of an Alderney gaming license?

Initial licensing costs can seem high to some. There is also the application processing time of four weeks, which — while not at all a long wait — could be longer than in some other jurisdictions. However, the fees and processing time are lower and shorter in Alderney than in some other jurisdictions, and many operators consider the Alderney license well worth the time and money. 

Alderney gambling license FAQs

Do I need a gambling License?

Yes. An eGambling license from the AGCC can be used by a licensee to operate in any country where it is legal to do so. In some countries, such as the UK, a licensee will also be required to obtain a local license issued by that country if accessing that market.

What’s the advantage of choosing an Alderney eGambling License?

Choosing Alderney as your licensing jurisdiction offers a host of advantages. The island’s transparent, competitive tax regime and fee structure are aimed at helping eGambling businesses operate as smoothly as possible. Furthermore, the AGCC’s risk-based approach to regulation ensures operators only need to comply with pertinent regulations.

Which type of license do I need?

Your business model will determine the type of license required. A single AGCC license enables the holder to organize any type of gambling activity.

The AGCC offers two main categories of license:
Category 1 (B2C) License.
Category 2 (B2B) License.

As an online casino operator, you will need to apply for the Category 1 License. The Category 2 License is primarily for software providers. You could also apply for a temporary license. However, these licenses are subject to other conditions which are outlined above.

How long does it take to get a gambling license?

An application for an eGambling license from the AGCC can be approved fairly quickly. The time it takes for the license to be issued depends on the application’s level of completion. Applicants can increase their chances of receiving approval in as short a time frame as possible by submitting all relevant documentation and responding quickly to due diligence information requests during the investigation process.

If all the required documentation is provided at the time of application and no complications arise, a license can be issued in as little as four weeks. Other jurisdictions often take much longer; in the Isle of Man, for example, the process can take up to 16 weeks or more to approve a license.

Do I need to be an Alderney-registered company?

While only Alderney-based businesses are eligible for the AGCC eGambling License, foreign-based companies can apply for the Associate Certificate. However, for a Category 1 (B2C) Associate Certificate, applicants must have a resident representative in the Bailiwick of Guernsey.

How much does a license cost?

The minimum cost for a new Category 1 or 2 License application is £17,500. The cost of a new license is subject to certain conditions. For license renewal costs and other fees from the AGCC, see the table above.

What are the applicable tax rates?

Unlike in some other jurisdictions, there are no gaming duties or VAT in Alderney. Businesses can enjoy zero tax on corporate profits with no capital gains taxes applied for Alderney-registered companies.

What are the gambling license requirements?

In order to apply for an Alderney eGambling license, operators must deliver a completed application form and pay a deposit that will cover the costs of the investigation.

Only companies registered in Alderney can apply for Category 1 and 2 Licenses. However, the company registration and license application processes can run concurrently.

Do my servers have to be based in Alderney?

No, you can have your servers based in an approved data center outside of the Bailiwick with a Category or 2 Associate Certificate.

If you apply for a License and not an Associate Certificate, then certain essential functions relating to gambling transactions need to be conducted on servers located in the Bailiwick.

Do licensees have to open a bank account in the Bailiwick?

Operators are not required to open an account with a financial institution in the Bailiwick. The AGCC’s global reputation can assist licensees in opening an account in a number of jurisdictions.

What’s the renewal process?

The license renewal is annual, at which time the appropriate annual license fee is due. The table of fees is available above.

What does the UK’s decision to leave the EU mean for Alderney?

As Alderney is independent from the EEA and the EU, the UK’s decision to leave the EU has no direct impact on Alderney’s eGambling regime, and Alderney licensees remain unaffected.

What else do you need to operate an iGaming business?

A license is just the beginning of a successful iGaming business.

For a fully-functional online casino and sports betting platform, you’ll need: 

  • Platform software
  • Game content
  • Sports data feeds
  • Payment service providers
  • Player retention software
  • Marketing strategies

Running an online casino business can be complicated. Cooperating with the right software providers is an essential part of getting the business started. Find out more about establishing an online casino here

How can Slotegrator help?

Applying for a gaming license in any jurisdiction is a complicated and time-consuming process, especially for first-time applicants. Much like any legal process, the best way to avoid wasting time, money, or both is to employ the help of experts to assist you with the application. 

Our jurisdictional advisory services can help you choose the right jurisdiction for your business and assist in every step of the way throughout the application process. Get in touch to find out how our legal team can help you get your iGaming business started.

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Petr Stehlik
Petr Stehlik
Lawyer
In 2016, I graduated from the Law Faculty of Charles University in Prague. The main area of law on which I focused both during and after my university studies is software law (and intellectual property in general). After graduating from the university, I briefly worked at a medium-sized law firm in Prague, but in 2018 I joined Slotegrator, where I have been working ever since and where I handle the company’s day-to-day legal matters.
Сomments
  • C
    Chase Song
    14 April, 2022
    I am a lawyer from China. Our client would like to start an online gambling business in Alderney and would like to ask you the following questions. 1. Does our client need to register a company before starting an online gambling business in Alderney? If our client needs to register a company, how much does it cost to do so? 2. If we engage you as our agent consultant, how much is the brokerage fee for registering a Category 1 licence (B2C)? I am very much looking forward to your reply, thank you!
    • Slotegrator Team
      14 April, 2022
      hello! First, Alderney offers an array of different licenses and certificates. Operators who aren’t based in Alderney can apply for a Category 1 (B2C) associate certificate (the equivalent of a license)— so, no, your client doesn’t necessarily need to register a company in Alderney. Regarding fees, a member of our sales team will reach out to you ASAP!
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