anchidim zagrean

The practice of gambling in 2024

The manner of compliance, for payment obligations or administrative procedures, in the gambling activity

Article from the series “Gambling Practice“, by Anchidim Zăgrean, FedBet Vice President and President of ROMBET

And for the year 2024, in the special regulation of gambling, a series of financial obligations or additional administrative procedures, in the activity of gambling, are stable, and for their implementation, a series of clarifications, rules or instructions are needed, on the way compliance for correct and uniform application.

We will review only a few of them, highlighting the opinions on the practical way of compliance and the way in which it must be acted, in order to achieve the goals and objectives that must be achieved, in the application of these regulations:

1. The provision from art. 1, par. 5, of GEO 77 of 2009, updated, where it is specified that, as an exception to the fact that gambling are operated directly by the license holder, the operation of gambling can be carried out, jointly, by 2 or more many organizers of gambling games, each licensed according to the law, or legal entities under joint control with organizers of gambling games licensed according to the law, between which there is a contract concluded under the terms of the law and the liability rests with the contracting parties. For the compliance and implementation of this provision, it is obviously necessary to define “legal entities under common control”. Of course, for this definition, one can start from the premise that joint control means that none of the legal entities, under joint control, has control over the other or the others, and decisions can only be taken by constituting a decision-making majority ;

2. In accordance with the provisions of art. 10, of GEO 77 of 2009, as amended and supplemented later, establish the obligation to collect contributions from licensed gambling organizers. These contributions are collected, in a proportion of 30%, in order to promote compliance with the principles and measures regarding socially responsible gambling and 70% are transferred to the state budget, within 5 working days of the month following collection. These contributions have the legal nature of a budget claim and are paid by taxpayers based on the O.N.J.N. notification, which is an enforceable title. For the implementation of this provision, the O.N.J.N., Order no. 142 of August 7, 2023 for the approval of the models of some forms issued and used in the field of the collection of the budget debt representing the annual contribution due;

3. In order to apply and put into practice the provisions of art. 13, par. 3, of GEO 77 of 2009, as amended by Law 30 of 2022, according to which: “A percentage of 98.8% of the fees charged for obtaining the license to organize gambling and the authorization to operate gambling, the access fee provided for in paragraph (4), as well as the other taxes provided for in this emergency ordinance constitute income for the state budget, and by way of derogation from the provisions of para. (2) of art. 30 of the Fiscal-Budgetary Responsibility Law no. 69/2010, republished, a percentage of 1% of these fees is constituted as income of the Romanian Olympic and Sports Committee and 0.2% as income of the National Paralympic Committee.”

For compliance and unitary application, in accordance with the provision in the primary regulation, we must note that although it is about all the fees charged, for obtaining the license and authorization, as well as the other fees provided in the ordinance, the exclusive condition, for redistribution to the three destinations, it is represented by the fact that these taxes must constitute income to the state budget budget as well as the fact that they must be expressly included in GEO 77 of 2009, as amended and supplemented up to this date. This is the reason for which results, obviously, that the distribution on the three destinations it should not include the administrative fees, which are owed directly to the ONJN and not to the state budget, and also not the fee, representing 2% of the total participation fees owed by online gambling organizers, by the fact that this obligation, against of the state budget, was established by GEO 114 of 2018 and as such is not provided for in GEO 77 of 2009. In conclusion, the administrative fees due to the ONJN, as a result of the provision of a service, as well as the 2% fee, which is not provided for in GEO 77 of 2009, must be transferred in full to the recipients established by law, respectively at ONJN and to the state budget;

4. The provision from art. 21, para. 1, lit. t of OG 51 of 1998, updated, whereby the organizers of gambling must share their income with: “The National Cultural Fund is an economic-financial instrument intended to support and realize cultural projects, whose own income comes from the following contributions:
t) a share of 0.5% of the revenues made by economic operators in the field of gambling, including for activities organized in the online environment.”

For the implementation and compliance, in accordance with the above provision, the organizers of gambling must calculate a share of 0.5% of the monthly income and the amount due is paid to the budget of the National Cultural Fund, until the 15th of of the following month, with a treasury payment order to account RO58TREZ70120E365000XXXX, opened at the Operative Treasury of Sector 1, on behalf of the National Cultural Fund Administration, with fiscal code 17966770. The monthly statement, regarding payment obligations to the National Cultural Fund, is mandatory and will submit either through the application available online at www.afcn-contributii.ro, or by e-mail, fax, post or directly at the headquarters of the Administration of the National Cultural Fund in the city of Bucharest, located in Barbu Ştefănescu Delavrancea str. no. 57, sector 1, until the 25th of the month in which the payment is made, for the previous month, cf. Order 2066 of 2011, updated with Order 2681 of 2023, of the Minister of Culture;

5. The provision from art. 110, para. 22, of the Fiscal Code, under the following wording: “The tax due in the case of income obtained as a result of participation in gambling characteristic of casinos, poker clubs, slot machines and lotteries, with a value higher than the non-taxable ceiling of 66,750 lei, is determined by applying the scale provided in paragraph (2) on each gross income received by a participant, and the amount of 11,650 lei is deducted from the obtained result.”

And in this case implementation and compliance could lead to different solutions, adopted by gambling organizers, by applying different procedures, that is why I believe that a unitary method of application needs to be established, in the sense that this provision must be applied to all these types of gambling (characteristics of casinos, poker clubs, slot machines and lotteries), regardless of the way the activity is carried out, namely games of chance organized and operated in the form of traditional games of chance or online gambling;

6. The provision from art. 47, para. 3, letter h of the Fiscal Code and according to which the Romanian legal entity, which carries out activities in the field of gambling, cannot opt for the facility regarding the application of the special regime of micro-enterprises, paying income tax, and economic operators, which carry out these activities, are obliged to pay the profit tax.

In this case, implementation and compliance obviously require the exit of economic operators carrying out economic activities in the field of gambling from this taxation system, procedure also valid for those who obtain these revenues as a result of a joint venture, with a gambling organizer, by registering the gambling revenues in their own accounting, based on the periodic statement through which the revenues and expenses are transmitted, as a result of the joint operation of this activity and based on the joint venture agreement.

The clear conclusion, derived from the above and always supported in the numerous previous articles, is that of the need for a full revision of the special rules regarding gambling activity, in full compliance with the constitutional principles regarding the quality, clarity, precision and predictability of the law.

We’ll be back with other opinions in the next issue of the magazine…

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