When asked to write about the Curaçao Gaming Industry, honestly, we had to think twice. On one hand, it is an outstanding opportunity to address an important topic, while on the other hand, it could be risky, given the negative association many people have with the industry. Should that risk be a reason to pass? No, it should not. In most industries, there are many people with good and bad intentions, and companies with good and bad performance. Gaming entrepreneurs and companies, including games of skill and games of chance, are virtually as old as mankind with many sides to the story so we decided to embrace this opportunity and highlight some history, changes and developments in this elusive industry.

We at PYGG, a capital structuring group also offering corporate services to a select group of clients, in order to be able to offer clients an integrated service, acquired a trust service provider which already accommodated a limited number of ‘eGambling’ companies. As we venture into this industry, we were curious… Curious to find if and how the gaming industry contributes to the economy of Curaçao in a positive manner. And how Curaçao could better use best practices from other comparable jurisdictions, like Malta.

The ingredients are here:

  • The global market size is expected to reach almost USD 60 billion in 2020, with a compound annual growth rate (CAGR) of 8.77% from 2019 – 2024 according to market research (Mordor Intelligence).
  • Curaçao has a competitive recognized Sub IP Licensing infrastructure.
  • Curaçao has state-of-the-art telecommunication infrastructure with 6+ sub-sea fiber cables and high tier datacenters.
  • Curaçao is rated largely compliant by the Organization for Economic Cooperation and Development (OECD), and offers a friendly financial climate for enterprises that focus on exports or doing business abroad.
  • Curaçao has experienced trust and corporate service providers capable of managing or representing the Curaçao based eGambling companies, known as the IP Operators.
  • There exists a regulatory framework to protect the interest of the public, integrity, and stability of the Curaçao gaming industry.

With the publication of the National Decrees dated January 28, 2019, LB numbers 19/0282 and 19/0283, the Gaming Control Board has officially been tasked with the Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) supervision of the gaming sector in and from Curaçao. By ensuring as much as possible that all gaming is conducted honestly, responsibly, competitively, and free from criminal and corruptive elements, the Curaçao gaming industry can be elevated and contribute further to the economy of Curaçao.

The gaming industry operating in and from Curaçao is held to compliance with the National Ordinance on identification when rendering services (Landsverordening identificatie bij dienstverlening (LID), PB 2017, no. 92), and the National Ordinance on the reporting of unusual transactions (Landsverordening melding ongebruikelijke transacties (LMOT), PB 2017, no. 99). IP Operators are required to be registered with the FIU (Financial Intelligence Unit Curaçao) and report any suspected conflicts with regulations and compliance.

IP Operators are legally required to make sure that their terms of service remain compliant with the OECD’s 5th Anti-Money Laundering Directive. Visible sufficient steps need to be taken to prevent manipulation of Know-Your-Customer (KYC) information in relation to accounts of players. Corporate service providers are expected to assist their IP Operator clients taking notice of regulator warnings worldwide regarding transfer schemes, such as Pump-and-Dump, and Pyramid schemes that may potentially harm their end users. Last but not least, IP Operators are required to have and live up to a clearly visible responsible gaming policy, including a self-exclusion clause. The service providers, including trust and corporate service providers, active in the field are aware of that. Together with the IP Operators, they verify and assure that the required checks and balances are in place, monitored and effective.

The global online gambling market can be segmented: (1) by gaming type into betting, bingo, lottery, and casino; (2) by device type as desktop and mobile; and (3) by geography. The geographical segmentation is as follows:

The global online gambling market is projected to grow at a CAGR of 8.77%, during the forecast period from 2019 to 2024. Online betting is the fastest growing segment during the forecast period. Artificial intelligence and machine learning have taken over the market. North America remains the fastest growing region in the market. In 2018, the U.S. Supreme Court ruled in favor of New Jersey in the PASPA (Professional and Amateur Sports Protection Act) case and struck down the federal ban on legal sports betting. Basically, this meant that New Jersey and other states could decide independently whether to allow their residents to bet on sports. Nearly two years later, 75% of U.S. states have either legalized sports wagering or introduced legislation to do so. Canada is largely an unregulated country in terms of online gaming, however there is the possibility of changing legislation by the end of the year. Additionally, Mexico is reviewing its gambling laws, with the aim to regulate the online gambling sector to bring it in line with the rest of the global gambling industry.

Now let us get back to the question, can Curaçao elevate its profile, position, and benefit from the online gambling market’s growth potential. As indicated earlier, it looks as if the ingredients are there: tested licensing structure, state of the art telecommunication infrastructure, largely compliant OECD status, improving regulatory framework and awareness. In addition, the island is close to one of the fast-growing markets, and as part of the Kingdom of the Netherlands, loosely affiliated with the largest and most mature market, Europe. While it is still illegal to offer online gambling in the Netherlands, this is slated to change soon. With a new law estimated in effect as of January 1, 2021, the Netherlands Gambling Authority, the Kansspelautoriteit (KSA), has announced that the Netherlands’ regulated online gambling market will open six months after as of July 1, 2021.

However even with many of the necessary ingredients, there is an important piece lacking which used to exist: a sound international payment processing infrastructure. That deficiency is among the root cause why many operational activities and payment flows have left the island. The ‘once upon a time’ good connection between our region and the global banks (payment platform) eroded because of ‘de-risking’.

De-risking refers to the restriction of correspondent banking relationships or business services from major global banks to certain jurisdictions due to concerns over money laundering or potential involvement in the financing of terrorist activities. For Caribbean countries including Curaçao, de-risking has been a major economic problem. A survey in 2017 by the Caribbean Association of Banks found that 21 of the 23 banks in 12 Caribbean countries lost at least one correspondent banking relationship.

In many parts of the Caribbean, the majority of banks are now reduced to having only one correspondent bank and at an extremely high cost. This ‘new normal’ is defined by restricted services, higher fees, and limited access to wholesale finance. This development has caused economic and reputational damage throughout much of the region, as well as being a point of friction between regional governments and the advanced economies in North America and Europe. According to Toussant Boyce, Head of the Office of Integrity, Compliance and Accountability at the Caribbean Development Bank, there is a ‘new normal’ in terms of Caribbean finance. But it is questionable whether the new normal is sustainable, and if not, it could represent further economic challenges in the region especially when it comes to access to international finance.

AML/CFT rules and regulations are now widely implemented with most governments active in the development of a regional body, such as the Caribbean Financial Action Task Force (CFATF), as well as active participants in cross-border investigations. Although the days of free-wheeling financial fraud are (generally) over, the pressure de-risking has caused clearly is not.

As we move forward, Caribbean countries should consider greater use of fintech (financial technology) in the region to offset some of the downside risk from de-risking. Fintech generally refers to a business that uses technology to enhance user experience with their financial transactions. What is the upside to using fintech? According to a 2019 IMF working paper, fintech can: (1) reduce transaction and service costs as well as foster financial inclusion and development; (2) enhance financial sector competition and improve intermediation; and (3) support growth and reduce poverty in the region by strengthening financial inclusion, development, and intermediation.

PYGG is a merchant banking ‘boutique’ based in Curaçao where corporate finance, securities intermediary and fiduciary services are combined to work seamlessly together under one roof. PYGG professionals provide customized and integrated financing solutions and represent clients in complex and valuable transactions. For additional information on this topic or other financial advice, please visit our website at or contact PYGG at or +5999 843 7236.

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