Five things we learned from the KSA’s 2022 annual report

Earlier this week, the Netherlands Gambling Authority (KSA) released its annual report for 2022, the first full year of overseeing the country’s regulated online gambling market.

Below, iGaming NEXT breaks down the five most important takeaways from the report.

KSA working through licence application backlog

At the time of the Netherlands’ legal online gambling market launch in 2021, just 10 operators entered the market under KSA licences.

Now, the market boasts 24 licensees, but the authority confirmed it still has 13 licence applications under assessment.

The process “takes a long time and requires a lot of capacity,” according to KSA chair René Jansen.

Many applicants have struggled to get their data properly in order for submission to the regulator, and subsequently failed to meet the requirements for gaining a licence.

Major operators such as Betsson and Entain (excluding BetCity) are yet to re-enter the market on a regulated basis.

Several applications have also been withdrawn or rejected based on background checks carried out by the KSA to assess the reliability of potential licensees.

Indeed, the regulator sets a high bar for licence applicants and has only awarded licences so far to some one in three applicants.

Jansen said: “I believe that setting these high standards is an important condition for a permanently reliable and safe online gambling offer.”

Channelisation around 85%

When introducing the Netherlands’ Remote Gambling Act (KOA) into law, Jansen said its political objective was to ensure at least 80% of Dutch gamblers played exclusively with licensed operators.

After the first full year of operating the market under the Act, the KSA estimates that 85% of players gamble with licensed firms only.

A large proportion of those players had previously played online, the regulator added, but with unlicensed operators.

Self-exclusion rate at 0.2%

Some 35,750 Dutch citizens have registered with the Cruks self-exclusion register, which prevents them from partaking in gambling either online with licensed operators, or in person at Holland Casino venues.

The number of self-excluded players represents just 0.2% of the country’s 17.6 million-strong population.

The figure can also be examined as a proportion of the number of active gambling accounts registered in the Netherlands.

According to the latest report on the matter, published in September 2022, there were a total of 1.3 million player accounts registered with licensed operators.

Of those, 563,000 were active, although the figures do not necessarily relate to the number of unique players in the market, as one player may open accounts with multiple operators.

In any case, the number of self-excluded customers on the Cruks register equates to around 6.3% of the number of active player accounts in the country.

Another market report is expected from the KSA in April 2023, in which more up-to-date figures will be published.

Advertising has ruffled one too many feathers

The KSA said that “the deluge of advertising for online gambling sites in the first months after market opening has not gone unnoticed,” and “has clearly damaged social confidence in the sector.”

As has been seen in several other regulated markets, overexposure to gambling advertising can see both public and political patience with the sector wear thin.

That has played out in several ways in the Netherlands, including prompting the introduction of a proposal for an outright ban on all untargeted gambling advertising in the country.

That proposal is now set to become a reality, after a ban on the use of ‘role models’ such as sports personalities and celebrities in gambling advertising already came into effect in June 2022.

The KSA has already handed out regulatory actions to those in breach of the rules, and said it will continue to closely monitor compliance as the untargeted advertising ban comes into effect.

A further investigation by the KSA to be carried out before this summer will provide more guidance to operators on how to approach compliance regarding their duty of care to customers – covering advertising rules as well as a variety of other requirements.

The 2022 men’s FIFA World Cup saw the regulator take action on non-compliant advertising 13 times with eight operators. In all cases, the companies in question immediately put a stop to non-compliant ads, the regulator said, after it got in contact via either phone, email or letter.

Close to €30m handed out in fines

The KSA issued financial penalties totalling €29.8m in 2022, with most of those issued to unlicensed operators based outside the Netherlands.

However in as many as 40 cases, the regulator was able to change the behaviours of operators through the threat of sanctions alone, it said.

The trend shows no signs of slowing down into this year. Millions of euros in fines have already been issued in the first months of 2023, and the regulator looks set to overtake 2022’s figure before the end of the year.

Recent fines include a €400,000 penalty issued to bet365 earlier this week, for directing gambling advertising and bonuses towards young people.

Another recent fine saw JOI Gaming, the operator of the jacks.nl online casino and sports betting brand, also ordered to pay €400,000 after advertising materials were sent to young people under the age of 24.

Larger fines have been issued to operators not in possession of a Dutch gambling licence.

For example, the Malta Gaming Authority-licensed Gammix was last week ordered to pay €4.4m for non-compliance with a previous order to cease offering its services in the Netherlands.

Meanwhile, a €10m fine issued to Videoslots earlier in March generated significant controversy in the industry.

Videoslots vowed to contest the fine, the largest ever issued by the regulator, describing the regulator’s actions as “unlawful” and insisting it does not target Dutch customers.