ROMANIAN REGULATION
as to whether or not gambling operators that configure sweepstakes as marketing tactics should be subject to the requirements applicable for advertising lotteries (where the advance notarization requirement of the campaign rules tends to be difficult to observe). Raffles: defined in law, absent in practice While the application of the legal regime for advertising lotteries to gambling operators licensed in Romania remains debatable, a different story unfolds when we analyze raffles/ tombola. Raffles are expressly included in the catalogue of games of chance regulated under GEO 77/2009, being defined as “the activity of extracting numbers, letters or other symbols, regardless of the characteristics of the mechanical, electronic, digital or video devices used to generate them or to carry out the draws – cups, urns, wheels and other such means, where the prizes awarded are fixed and do not depend on the number and price of tickets sold, coupons, tokens and other means attesting participation in the raffle. The winners – a predetermined number of participants – will be determined by random drawing in accordance with a regulation published in advance and approved by the ONJN Supervisory Committee. The raffle can be organized as a remote game of chance or as a land-based game of chance with the possibility of the physical presence of the players, and the prizes can only be in kind, their value cannot be less than 50% of the total value of the tickets issued for the purpose of carrying out the game.” Based on the above definition, it is clear that raffles represent a game of chance and the core feature of this product under Romanian law is that prizes may only be awarded in kind – they cannot consist of cash or cash equivalents. Moreover, the gambling legislation requires that the total value of prizes awarded must represent at least 50 percent of the total value of tickets issued (although not necessarily also sold) for the draw. Therefore, by comparison to sweepstakes where no participation fee is involved by design and the fundamental purpose of the activity is to boost the sales of the core business,
raffles represent a regulated game of chance (so a gambling business in itself), involving, by definition, an entry fee and where prizes can be awarded in kind only (this limitation does not exist in Romania when it comes to sweepstakes). In Romania, raffles can be organized either as traditional (land-based) games or as a remote (online) activity. However, since raffles represent a regulated gambling activity, these are subject to the licensing and authorization regime imposed by GEO 77/2009. Therefore, to offer a raffle on the Romanian market, the operator must obtain: • A Class I license (granted for 10 years) which is subject to an annual license fee of €20,000 (for land-based activity) or €300,000 (for online activity); • An authorization to operate (valid for one year and which must be renewed on an annual basis), subject to an annual fee of €85,000/location plus five percent from the nominal values of the tickets (for land-based activity) or 21 percent of the GGR, but no less than €400,000/ year (for online activity); The above license and authorization fees are not negligible, especially in case of online raffles. Unfortunately, there are other fees and financial obligations that make the operation even more prohibitive. Thus, any gambling operator who wishes to obtain a license and authorization in Romania must setup a guarantee meant to secure against the risk of non- payment of tax duties. In the case of land-based raffles, this guarantee is set at €1,000,000, while for online-raffles the amount is €2,000,000. On top of this, an operator offering online raffles is also required to pay a responsible gambling contribution of €500,000 which is due every year. It is odd that the legislator seems to have missed the amount of contribution due for land-based raffles. The above financial obligations are supplemented by numerous other operational and technical requirements (including other administrative fees, minimum share capital requirements etc.) which must all be observed in order to acquire the license and authorization from ONJN. For an activity that is constrained by law to award only physical prizes and operate within a low-margin structure, this financial burden seems disproportionate.
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IMGL MAGAZINE | JUNE 2025
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