5 Most Common Online Gaming Legal Issues

The first online casinos opened in the late 90s and yet 30 years later we are still struggling to understand what is legal and what is not if we are committing a crime while playing or not if we should pay tax after winnings or not, and much more.

Some countries outright ban all gambling, while others don't have any sort of casino law in place. If we wanted to cover everything on gambling law around the world we could write an encyclopedia.

Instead, in this piece, we will concentrate on the 5 most common online gambling legal issues. A Canadian iGaming expert, Michelle Thomas helped us tackle this task.

No uniform legislation

Usually, gambling laws are quite obvious and enforceable in small countries with not too large a population. However, when it comes to large countries such as the USA, Canada, or India things look very confusing.

The USA has different states, Canada has different provinces and India has different regions that regulate gambling without uniformity. The European Union is another big blur. In some countries, gambling is the monopoly of the state while others allow all foreign operators as long as they have a valid license.

In Canada, no law forbids Canadian residents to play at online casinos including mobile casino, however, it is illegal for online casinos to operate from Canada. But again, depending on the province, laws are somewhat unclear.

Protection of minors

One thing is for sure. Underage gambling is not allowed anywhere in the world. The legal age to gamble is usually 18 or 21. Again, in Canada, things are a bit more complicated as in certain provinces the age limit is 18 while in others it is 19.

The bartender can look at your face and check your ID in a bar when you order an alcoholic drink, but things are more difficult in online casinos. Sure, players have to send in a photo of their ID card but with a bit of Photoshop skills fake IDs can be produced.

Money laundering

Land-based casinos have been used for money laundering for decades and now online casinos can be used for the same purpose. This is what people do with money of dodgy origin: they deposit it on a casino account and place even-money bets.

For example, they bet nearly half of the money on black, nearly half on red, and a little bit on zero. This way they only lose the house edge, which is only a few percent. Then they request a withdrawal along with a document stating that the money was won legitimately. Online casinos operate teams that are there to pick up on suspicious betting patterns and therefore stop these types of money laundering schemes.

Taxation

When a casino is licensed they will pay taxes to the jurisdiction they are licensed in. The tax rates can be very high in certain countries, and this is the main reason why there are so many offshore registered casinos.

In some countries, players are supposed to pay taxes on the winnings as well. In Canada, punters do not have to pay taxes on their winnings. However, for example in Sweden, players have to pay gambling tax if they win at a casino that is not licensed in the European Union.

Licensing

Licensing is one of the most common gambling legal issues. For an online casino to be fully legal, they have to hold a license from a regulatory body. Reputable casino regulators are scattered around the world.

Some of the best gambling authorities are the Malta Gaming Authority, the UK Gambling Commission, and the Gibraltar Gambling Commission. Apart from these, there are other authorities in offshore jurisdictions such as Costa Rica, Curacao, and, in fact, in Canada - the Kahnawake Gaming Commission.

Apart from legal issues, there are many other things to consider when choosing an online casino. We have collected 7 tips for beginners that you'll surely find useful.

Conclusion

There are quite a few legal issues about online gambling. Mainly they derive from different legislations around the world, but money laundering and underage gambling are also serious issues.

(Devdiscourse's journalists were not involved in the production of this article. The facts and opinions appearing in the article do not reflect the views of Devdiscourse and Devdiscourse does not claim any responsibility for the same.)