Playing the lottery at international lottery sites, the site’s gambling license or lack thereof may not ever affect your gambling experience. However, it could also hugely impact it. In this article, we will tell you everything you need to know about licensing from an Indian lottery player’s perspective.
- A gambling license verifies that a lottery site is regulated and adheres to a country's legal and ethical standards.
- A license can ensure legal operation, fair play, prevention of financial crimes, protection of personal information, and responsible gaming.
- Licensing requirements depend on the lottery site's location and target audience, with many countries having their own licensing body.
- Where India lacks a centralized gambling regulator, international lottery sites can provide their services to Indian residents with licenses from other jurisdictions or without a license.
- Most Indian online lottery sites are licensed in the jurisdictions of Malta and Curacao.
- A Maltese license is highly reputable, requiring thorough vetting and documentation, and ensures player protection and dispute resolution.
- A Curacao license has a lower acquisition cost, is easier to get, and offers less oversight and player protection compared to a Maltese license.
- When possible, choose to play at MGA-licensed lottery sites, but reputable Curacao-licensed sites can also be safe options.
What Is a Gambling License and What Is the Purpose of It?
A gambling license is a form of verification that a lottery site is regulated by a certain organization, which in turn is governed by a country’s laws. The license and its regulatory body serve many purposes such as:
- Allowing the lottery site to legally offer its games.
- Ensuring that games and the gambling experience are fair.
- Preventing money laundering and other financial crimes.
- Preventing gambling from people who are underaged.
- Protecting a player’s personal and financial information.
- Making sure responsible gaming tools are available.
- Setting up a framework for dispute resolution.
- Ensuring that the lottery site pays its taxes.
- Creating frameworks for ethical marketing practices.
In a nutshell, being licensed means that a lottery site is paying a licensing fee and has agreed to follow a long list of rules that are rooted in a country’s laws. The license-issuing organization is then regularly auditing the lottery site to make sure that all rules are upheld.
However, there are many different licensing organizations, and among these, the rules that lottery sites must follow and the auditing that the licensing bodies do vary widely. We will elaborate on this shortly.
Who Needs to Have a License?
The requirement for a gambling license depends on where the lottery site is located and which geographic it is targeting. For instance, the UK has its own regulatory body known as the UK Gambling Commission which every lottery site that accepts UK players must be licensed by. If they are not, legal actions are taken, including fees and jail time.
However, the UK can only control lottery sites that are located within the country. Therefore, there are many lottery sites that operate in other jurisdictions. Here, they are licensed by that particular country, or, in some cases, aren’t licensed at all because the operational country’s laws don’t require it.
Sweden is another prime example of this. All gambling within the country is regulated by the Swedish Spelinspektionen. Despite this, you will find platforms such as Passagen and Online MGA Casino which are recommending Swedish gambling sites that are MGA-licensed instead of being licensed by Sweden’s regulatory body.
In India, it's a similar story. However, the country doesn’t have a centralized regulator or licensing agency for its paper lotteries run in 13 different states. Instead, the central government has given each state the freedom to establish a Directorate of Lotteries and formulate its own laws regarding the games.
Nevertheless, the Directorates aren’t the licensing bodies, but mere overseers. No entity is technically ‘licensed’ to offer lottery services in the country as the respective state governments take up the responsibility.
But just like the UK and Swedish licensing bodies, the power of every Directorate of Lotteries is confined to overseeing their own state-run paper lotteries. International lotteries that aren’t conducted in India are not subject to these regulations – not at the state level and not even at the federal level.
Therefore, they can offer their lottery services in India with a license from another jurisdiction or even without a license at all.
Common Licensing Bodies
What used to be confined to a few global licensing bodies has in recent years extended to a long list. Simply because more and more countries want to regulate the lottery and other gambling-related activities within their country by having their own licensing body. For instance, the UKGC in Great Britain and the Swedish Spelinspektionen in Sweden.
However, when it comes to India and the country’s lack of a true regulatory body, there are mainly two jurisdictions that you will find online lottery sites licensed by; Malta or Curacao.
The Maltese license is issued by the Malta Gaming Authority (MGA) and is considered highly reputable. The license is not only expensive for lottery operators to acquire and maintain but the application process is also lengthy and thorough. It includes over 30 documents that the applicant must provide about their business, such as:
- Business plan
- Bank declaration
- KYC procedures
- Accounting procedures
- Payout procedures
- RNG certificate (to prove the fairness of games)
It’s all very thorough, which is why an MGA license is often considered proof that a lottery site is legit.
The Malta Gaming Authority also helps with disputes that a player may have with a gambling site that they weren’t able to resolve with the gambling site itself. This can result in winnings that weren’t paid out being rightfully paid as the MGA will pressure the lottery site. In a nutshell, the organization protects you.
While lottery sites that are licensed by the MGA will have their license number in the footer of their website, the license can only be truly verified by using the license register on the regulator’s website. Here, you can type in the URL of the lottery site to find out if it is licensed or not.
Despite being a small Caribbean Island with a tiny population of 150,000, there are four different licensing bodies in Curacao:
- Curacao eGaming
- Gaming Curacao
- Antillephone N.V.
- Curacao Interactive Licensing
The vast majority of international lottery sites and other gambling establishments that are targeting India are licensed by one of the three formers.
Unfortunately, each licensing body in Curacao falls short in comparison to the Malta Gaming Authority. It’s a much cheaper license to acquire and maintain, and the application process is also a lot faster and not as thorough. Where it can take anywhere from 3 – 6 months to get an MGA license, a license in Curacao could be obtained as quickly as within a week, as stated on the Curacao eGaming website.
This ease of accessibility is what makes the Curacao licenses so attractive. Any person can quickly get set up and started with their gambling business. It’s perfect for the operator, but less optimal for the actual player.
The biggest issue with the Curacao licenses is that there is no one making sure that the lottery site is treating its players fairly. While the site may go through auditing during its onboarding process, there is very little or no oversight at all after this.
This is hugely problematic because even though a Curacao license doesn’t mean that a lottery site or other gambling establishment will be dishonest, it has the ability to. It can get away with things that lottery sites licensed by the MGA never could.
In terms of dispute resolution, players can file complaints with Antillephone N.V. and Curacao eGaming (not with the other two licensing bodies). However, in difference to complaints filed to the MGA where they are taken very seriously and viewed objectively, complaints filed in Curacao often don’t lead to anything or benefit the player.
Now, there are examples where players have had their disputes resolved by filing a complaint to the Curacao licensing bodies, but the process is difficult and not as streamlined as it should be. The licensing bodies also tend to agree with their clients (the gambling establishments) much more than they should, rather than being impartial and helping players out.
In terms of verifying a Curacao gambling license, the lottery site should have a clickable seal in the footer of their website, represented by an image. Clicking this would tell you if the license is currently active or not. The exception is the Curacao Interactive Licensing body which does not provide its clients with a verification seal. Thus, such a license can only be verified via a copy of a licensing agreement that the lottery site would have to provide.
Examples of Player Mistreatment on a Curacao License
There are many unfortunate examples where the player had to suffer due to the poor oversight and lenient rules that the Curacao licensing bodies have. Not necessarily lottery-related as casino gambling is much more prevalent, but the general concern remains the same.
A common example is when a company runs multiple gambling sites. A player may then sign up to site A and self-exclude (block themselves from the site). They then sign up to site B which is run by the same company and are allowed to do so as no cross-checks are being made between site A and B.
The player is allowed to gamble as long as he or she loses. However, when he or she wins and tries to cash out, the gambling site will refuse to pay, citing their terms and conditions that state that players who are self-excluded on their network are not allowed to play.
Such dishonest practice would not be possible at an MGA-licensed site.
This is a more niche example that we only know from one instance at a casino site. This site had entered in their terms and conditions that a max bet applies on all games. So, even though the games themselves allowed for a certain range of bets to be placed, if the player surpassed the limit mentioned in the terms and conditions, it was breaching the site’s rules and could have their winnings confiscated.
This is clearly dishonest and no practice that a reputable licensing body such as MGA would allow.
Should You Play the Lottery at Curacao Licensed Sites?
When given the option, choosing a lottery site that is licensed by the Malta Gaming Authority is always the safer bet compared to choosing a Curacao-licensed one.
However, this does not mean that a Curacao-licensed lottery site will provide a less enjoyable or less secure lottery experience. There are many high-quality gambling establishments that are licensed in Curacao that have operated for years and have an outstanding reputation among players.
It is, however, important that you are more cautious when considering play at a Curacao-licensed site. Make sure that the site has been recommended and reviewed by a reputable platform, such as our own, and don’t shy away from reading through the site’s terms and conditions. That’s what we do.
Reading through the terms and conditions may be a lot of work, but this is where you find any potential dishonesty that the site may be trying to hide.