The KSA has underpinned its aim to clamp down on unlicensed operators, issuing two significant sanctions to operators targeting the market without the correct license.
Allegations from the KSA state that Fortaprime SRL and Novatech have enabled Dutch players to use their platform, utilising crypto payments and not being hindered by age verification requirements.
Whilst challenges remain around the enforcement of the fines, Fortaprime was issued a bill for €1.8m (£1.6m), while Novatech was hit with the largest penalty ever given by the KSA to an offshore operator – a total of €24.9m.
Michel Groothuizen, KSA Chairman, said: “We determine the amount of the fine based on the (estimated) turnover that the illegal provider has achieved from players from the Netherlands.
“In doing so, we are limited by the law that says the fine may be a maximum of 10% of global turnover. Novatech earned hundreds of millions from its illegal offer, and did so mainly from Dutch players.
“A fine of €24m sounds impressive, but without the maximum of 10% the fine would have come to more than €100m; an amount that would be better suited to this violation.”
In addition to offering games illegally, the KSA also stated that Fortaprime’s offer has been advertised by Dutch influencers, a practice completely prohibited in the Netherlands.
It comes as European operators warn of the significant threat of the black market heading towards the World Cup in the Summer.
Speaking on a recent SBC Digital Day event, Aviv Sher, Chief Executive Officer of Codere Online, revealed his belief that ‘most customers are not really aware of the difference between regulated and unregulated brands’.
He continued: “Regulators are very effective at imposing rules, taxes and restrictions on licensed operators to keep play safe — but in many markets we rarely see the same effort directed at chasing black market operators.
“A few governments take it seriously, but in most places the action is limited. Meanwhile, those operators have far fewer restrictions, and major events like the World Cup are a huge opportunity for them to recruit players.
“One of the clearest examples is when you look at search results in the UK for things like ‘how to overcome betting limits’ or ‘how to gamble if I’m self-excluded’. You’ll often see unauthorised sites offering exactly that. They target players who are restricted from regulated operators.”
Whilst the action will be welcomed by Dutch operators, there have been widespread calls for a more complementary taxation regime in order to enable the regulated market to grow.
Trade associations Vergunde Nederlandse Online Kansspelaanbieders (VNLOK) and VAN Kansspelen, as well as operators Nederlandse Loterij and Holland Casino, this week looked to elevate awareness of the consequences of the current taxation rate to the House of Representatives.
An action plan has been issued by the trade bodies and operators to tackle the decline in tax revenue, including timely evaluations, results incorporation and future policy consideration.
Björn Fuchs, Chair of VNLOK, warned: “The government is trying to generate additional revenue with this measure, but is achieving the opposite. We are seeing lower tax revenues, more illegal offerings, and less money for sports and charities.
“This is not only financially unwise, it also undermines the policy of protecting players. The player is the victim of this policy.”
