The European Commission recently approved the latest Hungarian gambling law that had been submitted for review earlier this year. A smooth ride, however, is highly unlikely.
Despite ambitious plans by the government to supplement the country’s budget with tens of millions of dollars (or euros) from licensing/concession fees and taxes on legalized online gambling operations, the industry response has been rather lackadaisical.
Moreover, even if all necessary regulations are adopted at the earliest possible date following this go-ahead from Brussels, it could be months before any money starts rolling in. Operators would undoubtedly need some time to launch their casinos or online poker sites in Hungary, which can then generate those taxable revenues. Concession fees could start rolling in sooner, of course.
But it is precisely those concession fees that have caused potential operators to give the cold shoulder to the plans from Budapest.
The fact is that a HUF 100 million (EUR 325,000) annual concession fee for a single type license – either for casino games, poker or sports betting – may simply be too high when compared to the profits that can be made on the Hungarian market, especially for online sportsbooks.
Current regulations give state-owned Szerencsejatek a monopoly over sports betting and the company is set to remain a player in this area. They have in fact been working hard on a new site to give domestic players a better platform, through which to bet on sports in Hungary.
Newcomers would therefore have a very tough time establishing a profitable enterprise in the country, while very little to lose if they remain unlicensed in Hungary. Although such a move could lead to blacklisting and mandatory blocking by ISPs, the threat of losing the Hungarian players may still be a smaller one than the potential expenses associated with keeping them.
So, it remains to be seen whether the interest for Hungarian licenses will pick up, but no one should take those hopes to the bank just yet.