More than 2 years from the new regulation…

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Published in “Casino Inside”, issue 78

Authors: Ana-Maria Baciu & Cosmina Simion

The summer of 2015 was intensive for the gambling industry and brought the first interim rights to operate for the remote gambling operators. The spring of 2016 has brought, besides snowdrops, class 2 licenses for the providers of gambling content, audit and certification activities, financial services, marketing etc., and the circle was completed again during the summer with the first full licenses to operate.

One year later, a new summer meant the second year of operation for the vast majority of the operators and their suppliers, which were renewing their licenses. The Romanian market is now growing up, the operators are focusing on the quality of the products they offer, while the state authorities on their compliance with the legislation.

However, from our perspective as consultants acting in this field, we faced a lack of coherence and consistency from the state authorities, divergent interpretations of the legal texts, contradictory requirements, all leading to confusion on the market. This status quo is even today to the same extent uncertain.

In the process of reformation of the legal framework applicable for gambling which, in order to observe the requirements of the EU acquis, has allowed remote gambling operators to exploit their gambling platforms targeting Romanian players directly from foreign European jurisdictions, (without being required to establish a Romanian based entity), several institutions played an active role, such as the National Gambling Office (NGO), the National Office for Preventing and Combat Money Laundering (NOPCML) or the National Agency for Fiscal Administration (NAFA). Despite this, our experience this past year showed that these authorities have at times different interpretations and understandings of this legal framework.

Thus, in accordance with the provisions of the fiscal procedural code currently in force, any payer of taxes to the state budget is required to fiscally register by having assigned a fiscal identification code (which, in essence, is used for the correct allocation of the payments and the extinguishing of debts towards the same budget). The license fees applicable in the gambling field are not (and should not be) exempted, irrespective if the matter refers to the license and/or authorization fees incumbent upon the gambling operators or the license fee due by their providers, holders of class 2 licenses.

Nevertheless, only part of those entities holding the 297 class 2 licenses (at the date of this article) chose to proceed with the fiscal registration and assignment of the fiscal identification code, while the others opted to make payments to the state budget by using the fiscal code pertaining to the NGO.

Surprisingly, almost one year after NAFA has fiscally registered these entities, in the spring of 2017 it decided, presumably after the preliminary consultations with other state authorities that such fiscal registration is not necessary and argued that such tax payers do not fall under NAFA competence.

In view of the above, the class 2 licensed operators which were not fiscally registered at that date were to and did make payments by using the fiscal code of the NGO.

The paradox is that, only a few months later, towards the end of August, the NGO reverted and publicly informed via its official website as well as via its Facebook page and also individually each class 2 license holder that:

Information regarding the fiscal registration of non-residents economic operators

In light of the fact that the National Agency for Fiscal Administration has communicated that non-residents economic operators which perform related activities in the gambling field on the basis of class 2 licenses issued by the National Gambling Office are required to be fiscally registered in Romania, by submitting form 015 ”Declaration of fiscal registration/declaration of statements/declaration of deregistration for non-resident taxpayers which do not hold a permanent establishment in Romania”, we hereby request, until October 1st, 2017, to submit with the NGO the proof of commencing the actions for the registration with the Fiscal Administration for Non-residents Taxpayers.

Last but not least, we must emphasize that, even though the licenses are issued for a 10-years period, the validity of the class 2 licenses depends on the timely payment of the license fee, namely ”with at least 10 days in advance of the end of a one year period” (GD 111/2016, art. 147, (2), b)).  The fiscal registration procedure is thus necessary in order to allow the correct allocation and extinction of the duties towards the state budget.

The aspects described above do not represent a singular example and so, in the following edition, we shall follow-up on the anti-money laundering directive, both the third, as well as the fourth one, still awaiting to be transposed into the Romanian legislation. Of course, such story will be a gambling related story.

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