How to successfully scale a global eGaming operation: Advice and case study from a CSP
The online gaming sector has grown exponentially over recent years which has resulted in a consistent influx of start-ups and established operators expanding across the globe. Many jurisdictions have developed a robust regulatory framework which is a key factor behind a gaming entity establishing in a new jurisdiction.
In a competitive market, a gaming business should seek every possible advantage to aid the growth of their operations, this should involve working with experienced service providers in the sector for expert advice on how to successfully take the next step.
A Corporate Service Provider (“CSP”) ensures critical support when establishing or scaling a business. Here we analyse how the relationship between an operator and CSP can be utilised to help establish, grow and develop your business.
Expert advice from a knowledgeable partner in the industry
The gaming industry is a complex web of international regulations which vary between jurisdictions. A CSP can help navigate the complexities of running a global gaming operation, which includes assistance with licensing regimes, AML and compliance requirements and taxation to ensure the entity complies with the relevant jurisdictions laws.
An experienced CSP in the gaming sector will provide integral knowledge on the sector and the client will receive strategic input on how to meet their short and long-term goals.
A CSP’s bespoke service for gaming companies seeking to obtain a licence or expanding their licence list involves close assistance in submitting a successful licence application, which prevents costly errors or unnecessary delays.
A CSP will support the gaming business to maintain the highest of standards and a credible reputation in the industry.
Case study: partnering with a CSP to establish a new Gaming business on the Isle of Man
Altenar, a global sportsbook software provider, partnered with Affinity to expand its operations to the Isle of Man and establish a new entity in the jurisdiction.
Altenar are market leaders and specialise in developing and delivering advanced sports betting and related services. Altenar provide a complete package of services and products through their intermediaries that allow companies to launch and operate their online gaming site with minimal investment and effort. The company’s solutions help businesses in the gaming industry improve performance and grow revenue.
The company already had established in multiple jurisdictions, holding licences in Malta, United Kingdom, Romania, and more recently Ontario. By partnering with Affinity Group, they received specialised expertise to establish the business and guidance on how to meet its regulatory obligations.
Our gaming team provided Altenar with expert advice on the regulatory environment, including close assistance on navigating corporate, legal, AML and compliance requirements.
Our services to Altenar included the provision of local directors and registered office, administrative, compliance and human resource support and managing the firm’s tax and accounting affairs, seeking outside professional support where needed.
Since establishing a presence in the Isle of Man, Altenar is now one of the fastest-growing software supply businesses in the Gaming space, and recently on boarded a significant number of new staff in the Isle of Man as the firm gears up for its next growth phase.
What is a Corporate Service Provider?
A CSP provides a range of professional services such as incorporation, accounting, and legal support. For gaming businesses, CSPs can support licencing processes and entries to new markets, providing essential services for compliance and growth.
At Affinity, we provide a personal approach which involves bespoke expertise which is tailored to every business model.
Our services include:
- Anti-money laundering procedures and guidance
- Assistance with government grant applications
- Assistance with the mechanism for the protection of player funds
- Business plan preparation
- Company incorporation
- Data Protection Act registration
- Establishment of bank accounts
- Liaising with hosting providers and software suppliers
- Liaising with payment solution providers
- Liaising with regulators, lawyers and auditors
- Multi-jurisdictional licence applications
- Local employment assistance and guidance
- Provision of Company Directors and Secretary
- Provision of Key Officials including AML/CFT Officer, MLRO and Operations Manager
- VAT registration and completion of VAT returns
On-going support and services
A CSP provides a full range of services required for the ongoing administration of the gaming business which are tailored to the client’s unique business model.
Gaming start-ups or operators looking to expand may not have the resources to compete with their established, highly profitable competitors. A company utilising the expertise offered by a CSP, with personalised accounting and tax services, will be in a better position to mitigate these costs.
Many CSPs will also offer assistance with venture capital and investor relations, helping startups secure vital funding for growth. A CSP can also assist with banking contacts to help with financial planning and tax-efficient financial management. And as the industry evolves, a CSP can help businesses remain compliant with changing regulations and requirements, allowing them to stay ahead of the competition.
The Isle of Man: a Tier 1 responsible gambling jurisdiction
A globally leading jurisdiction in the gaming sector, the Isle of Man holds tier-1 regulation and reputable regulator, the Gambling Supervision Commission, which is recognised for its credibility, high standards and efficiency.
The Isle of Man is a self-governing British Crown Dependency that offers a variety of government incentives and a favourable tax environment for gaming businesses, including 0% corporation tax and 0% capital gains tax.
Banking is welcomed on the Isle of Man and has an established sector with many of the largest names.
There are many attractive characteristics that form its robust regulation, including 100% player protection.
With six world-class data centres combining gaming expertise with direct access to key European and American markets via six undersea cables – the Isle of Man offers businesses security and peace of mind with its highly resilient power, telecommunications infrastructure, and superior average bandwidth speeds over the UK.
By partnering with a CSP who provide local directors, a gaming business can establish a solid foundation in the Isle of Man and take full advantage of all the government incentives and tax benefits. And this means gaming firms can grow and scale more efficiently while minimising the risks and costs associated with operating in a new market.
The benefits of working with a CSP on the Isle of Man include:
- Compliance: CSPs can help gaming businesses navigate the complex regulations and laws in the industry, ensuring compliance with all relevant legislation and reducing the risk of penalties and fines.
- Cost savings: A CSP can help businesses save money by providing cost-effective incorporation, administration, compliance, and accounting solutions. CSPs can also provide personalised services on an as-needed basis, which can be more cost-effective than hiring full-time staff to handle these tasks.
- Flexibility: CSPs can provide flexible solutions tailored to the specific needs of a business. They can also offer scalable services as the business grows, which can support agility and responsiveness to market changes.
- Access to expertise: CSPs hold advanced expertise and the knowledge and experience needed to handle the complex tasks associated with incorporation, regulatory compliance, taxation and accounting.
- A trusted network: A CSP holds a range of intermediaries including the government, regulators, banks and lawyers who support their services.
- Time-saving: Working with a CSP can save businesses time by allowing them to focus on their core operations.
Working with Affinity Group on the Isle of Man
The Isle of Man Government welcomes new gaming entities and attracts gaming businesses to the island by providing a robust regulatory environment and various incentives.
As a CSP with many years of experience in the gaming sector, we hold a relationship with various key industry stakeholders and help gaming businesses take advantage of the benefits of the Isle of Man.
We take pride in our excellent client service standards, personalised expertise and support, offering guidance tailored to each client’s requirements.
The perfect way to scale a Gaming business
Once established, we provide on-going administration services to support the growth of the gaming entity. Our team of experts also provide clients with their expertise on the on-going regulatory environment and develop a long-term strategy if the client wishes to scale the business across jurisdictions.
A gaming business may consider moving from a CSP towards a standalone structure when the company has grown to a size where it can meet its responsibilities of operating independently.
At Affinity, our team of advisors can guide an organisation through this process, ensuring a smooth, successful, and compliant transition to a standalone ownership structure.
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