Your Business Plan
Remote gambling and wagering is a trade which requires a continuous effort. The first step to design effectively your operations is to build your business plan, which is a fundamental step for setting up your business relations with financial institutions and payment service providers, especially if you decide to incorporate your company offshore. In addition to that, a business plan allows you to understand the start up and ongoing expenses for running your gaming undertaking, that, in turn, largely depend on the country of residence of your punters. Marketing, technology and compliance with national regulations represent the core ordinary costs of any iGaming company and they are generally intertwined with each other, as any technological advance usually drives legislative responses and vice versa. Never forget that gambling constitutes a criminal offence in many jurisdictions, so, for instance, the use of internet tools for the geolocation of customers and the implementation of geographical restrictions represent a compulsory cost for your business, irrespective of the market you are actually targeting.
Developments in the US Market
Gaming and betting in the United States is regarded by a complex regulation, since each State has the power to establish its own legal regime. As a result, it is possible to divide the overall scenario in two different approaches, with some States banning any form of gambling at all (with some exceptions extended to not-for-profit entities); and others taking a more liberal stance, putting in place a stringent regulatory framework requiring gaming operators to get a specific licence for carrying out that economic activity and to subject themselves to the oversight of a public authority .
As far as remote gambling is concerned, it is also important to consider the role of Federal Law, because it deals with side-matters which are fundamental for the functioning of the iGaming industry, like the exploitation of interstate telecommunication facilities for gambling purposes. In particular, the Wire Act states that "a person engaged in the business of betting or wagering who knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers on any sporting event or contest, or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both". Although the Law only deals (in quite a plain wording) with "betting" on sporting events or contests and although the US Department of Justice (DoJ) had already excluded "gaming" from the scope of the Wire Act in 2011, nonetheless it appears that American justice authorities are reversing their opinion on online gaming. In January 2019 the DoJ published the report "Reconsidering whether the Wire Act Applies to Non-Sports Gambling" through which it broadened the scope of the prohibitions included in par. 1084(a) of the US Penal Code in order to encompass any kind of gambling activity running over interstate communication media, thus endangering the economic prospects of those US gaming operators which relied upon the 2011 report in order to develop their business at a national and international scale. In consideration of the relevance of the interests at stake, the Department of Justice has already made clear that the actual enforcement of the new opinion is still under implementation and some US States have already threatened to start legal actions against the DoJ in order to quash that reversal and protect their own online gambling regulations.
Considering the huge uncertainties affecting the US online gaming market, we strongly dissuade our clients from offering their services to American players and from holding in the USA any kind of equipment, which can be used for the daily running of their international iGaming undertaking, as this might constitue a federal crime under the most recent interpretation of the Wire Act by the US Department of Justice. Indeed, we are happy to advise our valued American customers who wish to bring overseas their online gambling operations and to employ the unrivalled expertise gained in the USA in emerging and growing economies abroad.
Luxembourg in International Tax
The Grand Duchy of Luxembourg is a small country nestled in the heart of Europe, between France, Germany and Belgium. It is among the most popular financial hubs in the world and the place where most of multinational enterprises choose to manage their investments and conduct financial transactions. It has a stable social and political system and a first-class international banking sector. The average actual rate of corporate income taxes is 24,94%, but it can be easily lowered to nil thanks to transparent and effective tax planning techniques, which are readily available to cross-border entrepreneurs.
There are plenty of tax reasons that lead foreign investors to incorporate a Luxembourgish Holding Company, as a conduit through which to manage their business:
Dividends received and capital gains arising from the disposal of shares held in any form of company are exempt from income taxes (Participation Exemption regime).
No withholding tax is levied on interest payments made in favour of a related lender (but transfer price rules remain applicable).
Vast network of sound double tax agreements, which include, in many cases, provisions that allow to eliminate the problem of economic double taxation (so called tax sparing treaty provision).
Vast network of bilateral investment treaties including anti-expropriation clauses.
Possibility to establish different types of companies and partnerships with flexible rules of corporate governance and different tax regimes (tax opaque or transparent).
After many years of in loco professional experience, we are able to set up a Luxembourgish corporate structure that goes hand in hand with your corporate, tax and personal needs.
Crypto Gambling Solutions
Since the enactment of UIGEA "Unlawful Internet Gambling Enforcement Act of 2006" in the United States, a significant number of countries (e.g., Italy) introduced in their national gambling regulations some clauses to prohibit payment service providers (notably VISA and Mastercard) from executing wagering-related transactions with operators unlicensed within their jurisdiction.
Within that context, crypto coins (e.g., Bitcoin, Ethereum) are game-changers for the offshore gaming and sports-betting industry.
If you are an online casino or sportsbook, we warmly suggest to have a look at the merchant solutions offered by CoinPayments Inc.. With an high level of integration, secure platform, and hundreds of coins accepted, CoinPayments Inc. is our trusted payment processor for crypto-transactions.
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Bellerophon Overseas Ltd.
International Business Company
ANGUILLA (Registered Office)
Albert Lake Drive, 2640, The Valley
Company Number: 2497018
UNITED STATES (Mailing Address)
205 North Michigan Avenue, Suite 810
Chicago, IL 60601