Obtaining a gaming license in Costa Rica in 2022

icon-author Petr Stehlik 📅 Updated 18 February, 2022 🕐 5min. 👁 906
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Albeit a major hub for the industry in Latin America, Costa Rica doesn’t actually regulate — nor license — online gambling operators. And yet, there are ways to establish a fully legal online gambling company in the country. Curious to know how? Keep reading.

Obtaining a gaming license in Costa Rica in 2022 0

Costa Rica as a gambling jurisdiction

When it comes to gambling, Costa Rica is a very peculiar jurisdiction. All games of chance were formally made illegal by the 1922 Gambling Law, however subsequent regulations and government interpretations opened the door to a legalised sector. Today, land-based casinos can operate within hotels, offering both slots, tables, and card games, whereas betting is subject to a state monopoly.

As for online gambling, the story is somewhat different. According to the current interpretation of the law, online gambling takes place where the transactions between player and operators are processed rather than where the operator is based. This means that, while it isn’t possible to obtain a gambling license, the government tolerates the operation of online gambling businesses based in the country as long as their transactions aren’t processed by local banks and they don’t offer their services to Costa Rican residents.

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The Costa Rican gambling license that isn’t a gambling license

As there is no online gambling license, most Costa Rican operators acquire a data processing license and operate under the guise of call centres.

Operators have to register with the Costa Rican Ministry of Commerce, Industry, and Economy, and apply for a data processing license in the municipality where their business is established (a physical presence is required). As these licenses are issued by municipalities — regional governments — rather than a central gambling authority, the requisites to obtain one may vary depending on the location.

Some of the most commonly required documentation for a data processing license are:

  • Certification of the legal capacities and corporate identification of the company
  • ID of natural applicants, plus certification of authorised residence from the Immigration Department if the applicants are foreigners
  • Right to use of the land (i.e. office space rental contract)
  • Certification of fulfilment of previous tax obligations
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Pros of operating an online gambling website from Costa Rica

The main advantage of running an iGaming business from Costa Rica is the lack of taxation on internet gambling revenues. However, by virtue of holding a data processing license, operators are subject to the tax rates applied to call centres.

These tax rates are a function of the company’s headcount:

Number of employees

Tax rate

Approximate tax burden in USD (2022)

Up to 50

57 base salaries

$41,500

51-99

87 base salaries

$63,350

100 or more

113 base salaries

$82,280

The “base salary” is a government-defined unit that varies from year to year. In 2022, it’s set as CRC 462,200 (€645/$728 as of January 2022).

Keeping in mind the lack of taxes on gambling revenues, these numbers are comparatively low for the industry. This makes Costa Rica an advantageous location to establish an iGaming business from an economic standpoint.

Furthermore, as the country lacks both a regulatory framework and a supervising authority, operators aren’t subject to the marketing and responsible gambling restrictions in place most elsewhere. It’s important to note that anti-money laundering regulations, on the other hand, are enforced.

Obtaining a gaming license in Costa Rica in 2022 1

Cons of operating an online gambling website from Costa Rica

But, as the saying goes, all that glitters is not gold. Operating out of Costa Rica comes with some limitations that can very well end up crippling an online gambling operator.

First of all, the lack of a proper gambling license makes it nigh impossible to secure transaction services from reputable international services and networks. While the rising usage of cryptocurrencies may soothe this issue, at present the volume of players relying on fiat currencies and traditional payment methods still far outweighs that of tech-savvy crypto users. As without deposits there’s no online casino, operators must make sure to have a viable structure in place to conduct transactions with players lest their venture end before it even starts.

The other downside is the same lack of regulations we listed above as a pro. While it’s true that it allows for more carefree operations with a lighter focus on compliance, from the perspective of customers this means less protection — and thus trustworthiness. Given the option, players will generally put their money in an online casino that they know to be held accountable by a rigorous licensing authority.

Unfortunately, the reputation of Costa Rican online casinos has gradually worsened over the years due to the irresponsible behaviour of operators seeking to make a quick buck rather than to establish themselves as trustworthy iGaming platforms.

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How can Slotegrator help you?

If you’re keen to start your iGaming business, Slotegrator can help you establish a company in your jurisdiction of choice — whether Costa Rica or elsewhere — and acquire all the necessary licenses. We also offer a crypto-ready online casino platform that allows you target tech-savvy players worldwide. To get more information about our products and services, just click the button below.

Also, if you are interested in learning about Costa Rica and the other gambling jurisdictions of the region, you can download our free eBook “iGaming in Latin America”.

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
  • J
    Jacob Linden
    15 May, 2022
    I am ready to open up an online sports gambling website. I believe Costa Rica is the best option for me but I want to make sure I set up the business correctly and obtain all the licenses and follow all the regulations ,so I can avoid all legal problems.
    • Artur Movchaniuk, Sales Manager
      15 May, 2022
      hello! Of course, making sure you follow regulations is very important while starting an online gambling business. We are happy to help here! I have messaged you to discuss more details.
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