Increased iGaming Revenue in Portugal Becomes Key Highlight in Second Quarter
Author:
Muhammad Gregory
The official Gambling Authority of Portugal, Servi?o de Regula??o e Inspe??o de Jogos do Turismo de Portugal (SRIJ), recently published the financial and performance results of the gambling sector in the second quarter of this year. In the regulated jurisdiction of Portugal, the gambling sector roped in gross quarterly revenue of €272.7 million in Q2 2023. The revenue was driven primarily by the online gambling and sports betting segments, which comprised more than 75 percent of the quarter’s total revenue, marking an impressive 41.8 percent year-on-year (YoY) increase.
Portugal has reported strong numbers in Q2.
?Nick Karvounis/Unsplash
Portugal is one of the European nations that opened its doors to all forms of gambling that are regulated by a single central authority within its borders. The Portuguese market is relatively new, as it only came into existence in 2015 when the Legal Framework for Online Gambling and Betting was brought into the picture. Five years later, the same framework was amended and is governed by Decree-Law No. 66/2015. In the last three years, the traditional land-based gambling segments have displayed very slow growth, but the online segment has driven revenue through the roof. The growth of the iGaming market in Portugal is attracting numerous private online gambling operators, and the regulator has been kept busy with permit applications. Apart from monitoring all gambling activity in the country, granting gambling licenses to operators is also a key role of the central regulator. It is essential for the authority to maintain the highest standards of regulation as the Portuguese market could become one of the best-performing gambling markets in Europe.
The year got off to a very positive start for the SRIJ as the revenue collected by licensed online gambling operators amounted to €159.1 million in the opening quarter of the current year. This sum was almost 25 percent higher than the revenue recorded from the same segment in the corresponding quarter last year. The growth is rampant and evident because the second quarter results look more promising than Q1 2023. The iGaming segment smashed the €200 million mark and accumulated a whopping €205.9 million in the second quarter of this year. Not only did it confirm a 29.4 percent quarter-on-quarter (QoQ) increase, but it was also 41.8 percent up YoY. The charts are expected to be green in the remaining two quarters of the year and beyond that as well because many new iGaming operators are entering the Portuguese jurisdiction. During the second quarter, the SRIJ issued gambling permits to 30 new online gambling operators, out of which 17 offered online casinos and other virtual games, while 13 are providers of online sports betting services.
The process of obtaining a permit for iGaming and online sports betting in Portugal is similar to that of many other regulated gambling jurisdictions. All European countries must follow the European gambling standards to ensure the integrity of their respective gambling markets. If the standards are not met, illegal operators can exploit the market and give rise to illicit activities like match-fixing and money laundering. A company must obtain a license from the SRIJ to operate an online casino in Portugal. The criteria for issuing an online gambling license are based on the type of company, its place of incorporation, and its financial and technical capacity. Only joint-stock companies or similar companies with headquarters in an EU or EEA Member State bound by administrative tax and anti-money laundering regulations and that are required to register a branch in Portugal can apply for a license. The main prerequisite for securing a gaming license in Portugal is to be technically and economically capable of operating the establishment.
Player Registrations and Self-Exclusions in Q2
The timing of the amendment of the legal framework for online gambling was impeccable, as it happened in the same year that the country experienced multiple lockdowns due to the COVID-19 pandemic. As gamblers were locked out of traditional land-based gambling institutions, many of them turned to online gambling for some respite. In a digitally growing world where consumers were confined to their own quarters, the online gambling segment grew quickly and has continued to thrive over the past three years.
At the end of the second quarter of this year, there were about 3.8 million individuals with an online gambling account on a licensed platform. As the player activity rises, the chances of harmful gambling also rise with it. To curb this harmful habit, regulated jurisdictions often run awareness programs and also have a voluntary self-exclusion register. Portugal also has such a register in which about 181,600 individuals have opted to sign up and keep themselves away from all legal gambling activities.
When individuals self-exclude themselves, licensed operators must keep track and not target these individuals with any of their marketing activities. In addition to that, their access to the operator’s platform must be blocked. These self-excluded players can still access illegal sites and gamble, but the SRIJ is locked in a battle with unlicensed operators and has sent out 25 closing notifications, 65 website blocking requests to Internet Service Providers (ISPs), and removed 54 gambling advertising videos in Q2 2023.
Ignoring European Trend, Betclic Became Liga Portugal Sponsor
Like many other regulated gambling jurisdictions, there are many restrictions on advertising gambling activities and services in Portugal. Encouraging player safety norms, the SRIJ has to ensure that all licensed operators comply with the gambling law of the country. Many jurisdictions in Europe have already imposed or are contemplating a blanket ban on gambling advertising and sponsorships. Amidst this situation, French iGaming operator Betclic made a bold move and became the title sponsor of Portugal’s top-tier club football league just after the end of the second quarter of the year.
The league is now called Liga Portugal Betclic and will be called the same till the end of the 2026-27 season. This is not the first time the Portuguese top division has been associated with a sports betting company. Before Betclic swooped in this year, the league was sponsored by renowned online sports betting operator Bwin. However, the move was still considered risky as several football leagues in Europe have decided to part ways with all gambling and sports betting-related companies gradually. These football leagues include the top-tier club football competitions of Belgium, the Netherlands, and the United Kingdom.
