Isle of Man Online Gaming Licensing Procedures

General Requirements

The applicants are to meet the following requirements to start an e-gambling business in the Isles of Man:

• to establish a Manx company,
• to have at least 2 local directors-individuals,
• to appoint at least one resident Designated Official (DO), or an Operations Manager (OM) if Designated Official cannot reside in the Isle of Man,
• to register servers and e players in the Isle of Man,
• to have gambling and trading accounts in a bank in the Isle of Man.

The OGRA license is required for sportsbooks, betting exchanges, online casino games, mobile phone betting, live dealing, network gaming and some other activities. But it is not needed in case of the UK or Isle of Man National lottery, gambling covered by a Betting Office license or by a Casino license, spread betting, activities defined by the Insurance Act 1986 and some others. The OGRA license runs 5 years and permits its holders to offer technology (games, software, etc) to sub-licensees under the reduced-fee sub-license scheme, but not to a parent or holding or sister company.

Application Process

Initially, an application form should be completed and with the £1,000 processing fee should be proposed to the Inspectorate. The required application forms to start an online sportsbook in the Isles of Man could be found at Application Forms.

When sending an application to the Commission, it should contain the following items:

• The application form,
• The £1,000 fee,
• Police Vetting Unit “excepted positions” declarations (‘pink forms’) for all key officials (directors, shareholders of more than 5%, Designated Officials, Operations Managers),
• A personal declaration form (PDF) for any of the following appointments. If an individual fulfils more than one role, only one PDF is required:
  • All shareholders of the applicant company with holdings above 5% and any shareholders of the ultimate parent company and any companies in between with holdings above 5%
    (Note that the due diligence required for publically listed companies varies slightly: in these instances, we seek to scrutinize all shareholders with 20% or more stock),
  • All directors of the applicant company if it is a privately owned entity,
  • The Designated Officials,
  • The Operations Manager (if appointed),
• A list of key officials in the group where the application is from a publically listed company.
• References for the above – please note that a given referee may only be used once per application. This means for example that an application with three PDFs would require a total of six different referees
• A business plan including the following chapters (which are defined in detail in section 3.5):
  • financial accounts
  • ownership
  • terms and conditions
  • game rules
  • player protection
  • internal control systems
  • technical checks on games offered
  • the  business model
  • payment schematic
  • the proposed banking arrangements
  • customer due diligence
  • website look and feel
  • infrastructure checks
  • player registration checks
  • treasury services
  • transaction recording for games and lotteries
  • transaction recording for sportsbook betting

Two hard copies of the entire application bundle should be supplied to the Commission, together with one electronic copy which has all individual documents saved as separate files.

In case of a satisfactory result the applicant receives a corresponding notification within 10-12 weeks.

The directors on the board of the Manx company, Designated Officials and the Operations Manager are invited to the so-called formal hearing where all licensing conditions are discussed and approved.

If the license is approved, the applicant receives a notification from the Director of the GSC after that hearing. If it is not approved, the notification will comprise the reasons accompanying the negative response.

Fees and Taxation Required

To obtain a full OGRA licence an applicant is subject to the following charges:

• £1,000 processing fee for the application process;
• £35,000 annual fee for an OGRA license;
• £5,000 sub-license annual fee;
• currently there is a levy charged for funding education, research and support for problem gambling.

Duty

In addition, online gaming involves gambling duty on a sliding scale from 0.1% to 1,5%, except a so called pool betting, in case of which the duty is equal to the UK duty rate. 

• 1.5% for gross gaming yield not exceeding £20 million per annum;
• 0.5% for gross gaming yield more than £20 million, but not exceeding £40 million per annum;
• 0.1% for gross gaming yield exceeding £40 million per annum;
• 15% for gross gaming yield from Pool Betting.

For professional counseling on the issue of online gambling, please refer to the following:

The Gambling Supervision Commission

Telephone: +44 (0)1624 694331
Email: gaming@gov.im
4th Floor, St Andrews House, Finch Road, Douglas. Isle of Man. IM1 2PX.

The Department of Trade & Industry

Garth Kimber - Head of e-Gaming Development
Telephone: +44 (0)1624 682307
Mobile: +44 (0)7624 464473
Email: garth.kimber@gov.im

Lisa Underwood - e-Gaming Development Manager

Telephone: +44 (0)1624 682365
Mobile: +44 (0)7624 422900
Email: lisa.underwood@gov.im

Trusted Partners
SMP Partners Ltd

PO Box 227, Clinch's House, Lord Street,
Douglas, Isle of Man IM99 1RZ
Tel +44 (0) 1624 682241 Fax +44 (0) 1624 691717
Mob +44 (0) 7624 486035
david.hudson@smppartners.com
www.smppartners.com