Costa Rica is a presidential republic situated in Latin America and neighbors Nicaragua to the north and Panama to the south. Thus, the article continues the exploration of the country’s bookmaker legislation, the history of its development, the main authorities in the sphere, types of forbidden and allowed bets, licenses, fees, taxes, and, of course, sports betting. In this article, the author aims to assist the potential investors and enthusiasts to comprehend the existing situation with Costa Rica bookmakers and Costa Rica sports betting.
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Table of Contents
Summary of Key Events
History of Costa Rica Bookmaker Gambling Laws
History of gambling legislation in Costa Rica is rather detailed, and the situation has always been rather ambiguous. While gambling remained a ban in Costa Rica since 1886, it could be stated that the country is one of the first to formally prohibit private gambling. The main pieces of gambling legislation are:The main pieces of gambling legislation are:
- 2008: Regulate of Casino Games Establishments (Costa Rican Gambling Law).
- 2012: Law of Casino and Interconnected Calls Betting Companies Taxation (Costa Rica Casino Law)
- 2010: Act on the Organisation of Betting, Casinos and Lotteries and Games of Chance (Gesetzgestell Zweckbetreuung Glücksspiele und Wettbewerbe Nr. 17,551)
These laws have defined the legal framework for gambling in the country; however, there are still many loopholes and unsolved issues.
Regulatory Agencies and Licensing
Since online gambling is not regulated in Costa Rica there is no special authority for the granting of online gambling licenses. However, the Ministry of Public Security is responsible for issuing licenses for gaming machines and tables in land based casinos and the Ministry of Economy, Industry and Commerce deals with the commercial licenses. Moreover, there is a situation when private online gambling is banned but practically possible; that is, businesses may be based in Costa Rica, but they cannot admit Costa Rican players.
Types of Licenses
To operate an online gambling business in Costa Rica, companies typically obtain a Data Processing License, which requires:
- The incorporation as a Corporation in Costa Rica
- Enrollment to the local tax service
- Some procedures that may be followed when obtaining a business license from local government authorities.
However, it needs to be pointed out that this license does not directly cover gambling operations. Nevertheless, it allows processing of data about gambling activities, which are conducted in the territory of Costa Rica.
Licensing Fees
- Permanent license fee: Five thousand US dollars.
- License renewal fee: The prize amount is USD 5000.
- Legal costs: USD 500
These costs make Costa Rica a favorable jurisdiction for startups and small businesses that want to try and tweak new business models and test them at a lower cost in a relatively open environment.
Prohibited and Allowed Bets
Even though private gambling is forbidden, the state gambling is allowed. The Junta de Protección Social (JPS), the state lotteries company has the exclusive right to provide all forms of betting and gambling other than casinos. According to Law No. 8718, the JPS has exclusive rights to:
- Organization, management, selling and promotion of all lotteries including the pre-printed lottery tickets and the electronic ones.
- Sports betting
- Video-lotteries
- Other gambling activities within the nation’s jurisdiction.
The online gambling companies that are based in Costa Rica, remain prohibited from providing their services to the local players. Rather they aim at cornering the international market.
Taxes and Fees of Costa Rica Bookmakers
Online Gambling Tax
Foreign incomes of corporations in Costa Rica are exempted from tax. Since the operators of online gambling can only accept players from other countries they do not have to pay gambling or corporate taxes.
Gambling Taxation on Physical Outlet Shops.
According to the 2012 Tax Law on Casinos and Companies linking calls to electronic bets:
- net income of natural or legal persons derived from the activity of legally permitted casinos is 10%.
- The percentage of 60% of the base salary for each of the gaming tables approved by the Ministry of Public Security.
- The amount equal to ten percent (10%) of the base salary for each slot machine located in the casinos approved by the Ministry of Public Security.
Player Taxes
For the players there are no taxes on gambling winnings in Costa Rica. An attempt to introduce a new 25 percent tax on large lottery winnings was refused in the year 2020.
Sports Betting of Costa Rica Bookmakers
Sports betting also forms an important part of the economic activities and many international companies have their base in Costa Rica. Unfortunately, such companies are not allowed to accept bets from the citizens of Costa Rica because of the legislation restrictions. Nevertheless, soccer is developed in Costa Rica, and the country has a strong culture for sports, especially soccer, which contributes to sports betting.
Sporting Event Glory Milestones
Costa Rica has achieved significant milestones in sports:
- FIFA World Cup Appearances: The national soccer team of Brazil has competed in the FIFA World Cup four times; the best finish was in 2014 where they got to the quarter finals.
- CONCACAF Gold Cup: Second place in the year 2002.
- Olympic Games: Competed in Summer and Winter Olympics and got 4 medals in swimming events.
Conclusion
Overall, it can be stated that Costa Rica is a special and somewhat shady country for bookmakers and the sports betting business. Despite the absence of specific legislation concerning online gambling, the country’s quite liberal approach to business and low taxes can be considered as advantages for new and small companies. Thus, the industry is constantly growing and developing, and Costa Rica is still considered as a reliable jurisdiction that offers numerous prospects for investors and operators in the global gambling sphere.
FAQ of Costa Rica Bookmakers
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