The Lack of Internet Gambling Regulations in Costa Rica

There are hundreds of internet gambling operators located in Costa Rica and the industry provides thousands of jobs in the country. Located in Central American Costa Rica is also a popular tourist destination with beaches and wildlife galore. Internet gambling knows no borders and many online gambling operators have located in Costa Rica because of its lax gambling regulations. Unlike many licensing jurisdictions gaming operators do not have to undergo background checks and unfortunately this has led to criminal organizations running online gambling operations in Costa Rica. Gambling operators are lured by lax regulations and an inexpensive labor force that is bi lingual. By 2000 the internet gambling industry had provided 5,000 jobs with good wages and benefits.

In Costa Rica the government has no clear laws regarding online gambling. Gaming operators are forbidden to take wagers from residents of Costa Rica. Because of the lack of regulations and gaming legislation internet gambling companies are self regulating. Internet gaming companies are not subject to the strict regulations of other jurisdictions such as Gibraltar and Malta. The lack of regulation has had mixed results and there have been numerous complaints about online casinos licensed in Costa Rica. Another disadvantage is that internet bingo sites licensed in Costa Rica are not allowed to advertise in the UK which is the world’s largest online bingo market. In 2008 Costa Rica reached an agreement with the United States regarding US restrictions that hurt gaming interests in Costa Rica.

Internet gambling operators in Costa Rica do not receive gaming licenses. Because gambling is illegal within Costa Rica gaming operators are issued data processing licenses and are not subject to betting or gambling taxes. In Costa Rica any business with income from foreign sources is exempt from taxes although this may change soon. The licenses are not mandatory but most internet gambling operators obtain the licenses to appear reputable to players. In 2003 the country required internet gambling firms to register with the economy ministry and pay taxes of 26,000 to $63,000 depending on the number of people employed.

Internet gaming licenses are a recent development. A Costa Rica corporation license costs about $15,000 and $1,500 must be paid every three months to keep the license active. As has been mentioned most internet gaming companies are licensed as call centers, software companies, or data processing firms. One major disadvantage for players is that there are no measures in place for dispute resolution. Players involved in disputes must deal directly with the companies involved. Players are advised to be cautious when dealing with any internet gaming operator based in Costa Rica.