Bulgaria as an online gambling services location

Bulgaria's online gambling industry

With over 15 years of history, Bulgaria is established in support services relating to online gambling, including software development at various levels of the value chain; technical and customer support and back office functions.

A range of mainly British, Gibraltarian and Israeli players run substantial Bulgarian operations (e.g., Ladbrokes, Playtech, Bwin.party, William Hill, SB Tech).

A strong outsourcing industry more generally provides the backdrop to online gambling support.

Bulgarian developers and support agents are generally seen as capable of high-quality output and possessing excellent intercultural skills.  The timezone (UTC +2), places Bulgaria close in its working day to several large global markets.

Bulgaria generally ranks in the top tier for Internet speed and accessibility. The average connection speed in Bulgaria is 15,815 kbps, with average peak connection speeds of 59,048 kbps according to data from Akamai’s State of the Internet report. 4 Mbps broadband penetration reaches 96.8% and 15 Mbps broadband penetration at 40.2%. The advantageous Internet infrastructure makes it ideal to base servers or staff that remotely support the online gambling operators.

On the risks side, due to the smaller labour market, it might be harder to scale beyond a certain size particularly over a short period of time.

Bulgaria as an online gaming licensing base

The Bulgarian Gambling Act (most recently updated in 2014) allows the licensing of online gaming operators.

Substantial policy efforts have been invested in modernising legislation. The government has focused on adopting best practices and sought to lower the barriers to licences and create a balanced regulatory environment in a favourable tax regime.

For example, exchange betting specialist Betfair was granted two online gambling licenses by Bulgaria‘s State Gambling Commission (SGC) in 2014. Betfair is authorized to offer sports betting (including exchange wagering) as well as wagers on horse and dog racing. Betfair was also separately licensed for online casinos and poker.

Operators are charged a one-off licensing fee of approximately US$ 56,000 plus 20% on the difference between the value of the bets received and the winnings paid out, except that games which involve the collection (by the operator) of a commission or a fee for participation are instead charged a fee of 20% on the value of such commissions or fees collected.

An online gaming licensee may be a corporation established elsewhere in the EU (e.g., Malta). Once licensed, it may operate anywhere in the world subject to local laws and
regulations.

In conclusion, Bulgaria may be an appropriate destination for online gambling operators. 

Bulgaria’s gambling taxation regime together with the balanced regulations currently in place, makes the country attractive for local licensing and gambling operations based upon a low corporate tax and comparatively highly-qualified and low-priced technical specialists.



Recent work:

An ~€1M claim on behalf of real estate consultants

NBLO’s dispute resolution lawyers represented UK-based real estate consultants who had structured a € 40-million-worth commercial property project on the Bulgarian Black Sea coast.  In breach of an applicable contractual obligation, the consultants had not been paid the agreed success fees for their services. The then director of the defaulting party had been tragically shot dead in the meantime.

Following a hotly contested first instance, with below-the-belt attempts by the other side (the least untypical perhaps being the claim that the contract had been a forgery and a trial-within-a-trial on the issue), our team succeeded in obtaining a judgment at first instance.  The parties were then able to achieve a significant settlement.

The key skills we were able to bring to bear in providing a solution included searching for solutions across the problem domain; appropriately involving representatives of Bulgaria’s EU partner member-states to buttress judicial independence; and resourcefully dealing with heterodox approaches by our judicial opponents.

© New Balkans Law Office 2018