In December 2004, Hungary’s Gambling Board initiated legal proceedings against the UK’s Sportingbet Plc, which launched its Hungarian-language website in June 2004. László Oravecz, department head at the board, stated that since Sportingbet is operating without the appropriate license, according to Hungary’s criminal code, organizers of illicit gambling could be sentenced to two years in prison. Spokespeople for Sportingbet claimed that their activities were legal and that the company conformed to all applicable EU regulations.
In March 2007, the European Commission issued an opinion against Hungary’s online gaming monopoly.
In October 2008, Hungary proposed reforms to open its online gaming market allowing EU- and EEA-based online sports betting companies to apply for authorization to advertise and operate in the Hungarian market. The European Commission will review the strict tax requirements, which may cause a barrier to entering the market.
In April 2011, Szercencsejáték, Hungary’s National Lottery and largest gambling service, launched a tender for the implementation of their Internet gaming platform to provide online gambling and sports betting to go live by the end of the year.
Amendments made to the Gambling Act in September 2011 opened the market for online operators to legally offer online horse betting and cards games (poker) effective January 1, 2012. The Hungarian Tax Authority is responsible for approving all sites and licenses issued for an initial five-year period. After the five-year term, operators may apply for an additional five-year license. Net revenues are taxed at 20% and payable to the Tax Authority. Operators need to meet a minimum registered capital of HUF 200 million (approx €690,000) in a member state of the European Economic Area (EEA) or within Hungary, have relevant experience in the industry, and a certified gaming and business system. ISPs must block unlicensed sites and banking institutions must freeze the bank accounts of unlicensed operators if required by the Tax Authority. Unlicensed operators are subject to fines up to HUF 100 million (approx €345,000). Online casino games and sports betting remain a monopoly with the state-owned lottery organizer, Szercencsejáték.
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