Gaming Law 2024

Last Updated November 01, 2024

Vanuatu

Law and Practice

Authors



MannBenham Advocates Limited has more than 25 years of industry expertise and acts as a trusted partner in unlocking the lucrative potential of Vanuatu’s online gambling market. The firm’s comprehensive services, from securing Vanuatu gaming licences to ensuring full legal and regulatory compliance, guarantee a seamless set-up for any business. The team handles everything ‒ application preparation, liaising with authorities, corporate governance, and ongoing compliance ‒ so clients can focus on growing their business. With a low-tax regime, efficient licensing processes, and MannBenham’s expert guidance, there is no better time to take advantage of Vanuatu’s attractive gaming environment.

Vanuatu has long been a pioneer in the interactive gaming (“iGaming”) sector, owing to the Vanuatu government’s innovative approach that led Vanatu to become the first jurisdiction to issue online gaming licences in 1999. This resulted in the passing of the Vanuatu Interactive Gaming Act in March 2000, which was later updated on 17 March 2003, enabling the government to introduce the idea of offering online gaming licences to sportsbooks and betting exchanges.

In recent years, Vanuatu has focused on improving the regulatory environment in order to attract more international operators. The introduction of tax reforms and reduced application fees, alongside a streamlined online application process, has made the jurisdiction more attractive for gaming operators seeking to expand into new markets. The Vanuatu Gaming Authority (VGA), which operates under the Department of Customs and Inland Revenue (DCIR), plays a pivotal role in administering licences both for online and land-based gambling.

Emerging Trends

The following trends have had an impact on the market in Vanuatu recently.

Cryptocurrency and blockchain

The global rise of blockchain technology and cryptocurrencies has influenced Vanuatu’s gaming industry. Although no significant cryptocurrency-based casinos operate from Vanuatu, the country has taken steps to create a regulatory environment that supports blockchain technology and digital assets.

A forthcoming Virtual Asset Service Provider (VASP) bill is expected to attract operators interested in offering blockchain-based gambling services. This new legislation would bring Vanuatu’s gaming regulations into alignment with Financial Action Task Force (FATF) guidelines, ensuring compliance with international standards for cryptocurrency operations.

Increased enforcement and AML/CFT

Vanuatu has focused on strengthening its AML/CFT framework. The Consolidated Anti-Money Laundering and Counter-Terrorism Financing Act No 13 of 2014 (the “AML/CTF Act 2014”) mandates reporting entities, including gaming operators, to implement robust compliance mechanisms. The recent trend towards more stringent enforcement has also emphasised the need for KYC processes, ensuring that gaming platforms verify the identity of players. For more on the AML/CFT Act 2014, please see 8.1 AML Legislation.

Consumer protection and responsible gaming

As part of a broader international movement towards safeguarding players, Vanuatu has introduced policies to promote responsible gaming. These measures include the mandatory display of responsible gambling messages in all advertisements, the availability of self-exclusion options for problem gamblers, and public awareness campaigns to promote responsible gambling behaviour. The government is also enforcing stricter regulations around the protection of minors by mandating age verification mechanisms for online operators.

Regulatory shift

In 2024, Vanuatu revamped its online gaming regulatory framework, making it more favourable for operators. The VGA offers interactive gaming licences for a 1% tax on wagering activity, making the jurisdiction more competitive internationally. The launch of an entirely online licensing process has also streamlined operations for businesses looking to establish themselves within the country, cutting down processing times and reducing fees.

Key Challenges and Opportunities

The gambling sector in Vanuatu is currently facing the following challenges and opportunities.

  • Technological advances – the introduction of new technologies, such as blockchain, offers opportunities for operators to innovate. Vanuatu’s forthcoming cryptocurrency legislation could position the country as a hub for crypto-based casinos.
  • International competition – despite the above-mentioned technological advancements, Vanuatu still faces significant competition from more established online gaming jurisdictions such as Curacao, the Isle of Man, and Gibraltar. The challenge will be whether Vanuatu can capitalise on its recent regulatory reforms to become a major player in the iGaming space.
  • Tourism and land-based gambling – Vanuatu’s physical casinos, particularly in Port Vila, contribute significantly to the nation’s tourism industry. As Vanuatu continues to enhance its regulatory framework, the government is expected to invest in further developing land-based gambling venues, especially as part of the broader initiative to boost tourism.

Future Outlook

The future of gambling in Vanuatu is strong and promising, owing to the government’s proactive stance on regulatory reforms, especially with the introduction of modern technology regulations and responsible gambling measures. Vanuatu is positioning itself to attract more international operators while ensuring compliance with global standards on AML and player protection.

In Vanuatu, the Interactive Gaming Act 2000 serves as the primary legislation governing online gambling. The following sectors are permitted, prohibited or restricted as follows.

  • Betting – online betting is permitted, subject to licensing requirements. Operators offering sports betting must comply with financial and regulatory obligations.
  • Bingo – online bingo is permitted under the same framework as other online gaming, albeit not as widely adopted as casino and betting services.
  • Casino – online casino services are fully permitted, with online operators required to obtain a licence from the VGA. Operators may offer a range of online casino games such as slots, poker, and table games.
  • Lotteries – online lotteries are permitted, even though no significant national online lottery presence exists. Online lottery operators must adhere to the Lotteries Act 1989.
  • Fantasy sports – there is no specific regulation for fantasy sports, but operators could theoretically offer such services under the general gaming licences. These would need to comply with the standard laws applicable to gambling.
  • Social gaming – this is typically exempt from gambling regulations if no real money is involved. However, should real-money transactions occur, licensing and regulatory measures would apply.
  • Poker – online poker is permitted under the Interactive Gaming Act 2000 and operators can offer poker alongside other casino games on their platforms.

Other relevant sectors include esports betting, which is growing in popularity and would fall under the same legal umbrella as traditional sports betting.

Vanuatu’s legal framework also governs traditional, land-based gambling operations, including the following sectors:

  • betting – permitted, with sports betting available at some physical locations;
  • poker – permitted in licensed casinos, with popular games including Texas Hold’Em and other variants;
  • bingo – permitted in licensed halls, albeit less common than other forms of gambling;
  • casino – Vanuatu hosts several licensed casinos, primarily located in Port Vila, which offer a full range of table games, poker, and slot machines;
  • gaming machines – permitted and regulated under the Casino Control Act 1993, with many casinos and resorts offering slot machines as part of their gaming activities; and
  • lotteries – permitted, with both local lotteries and private events subject to the Lotteries Act 1989 (as noted in 2.1 Online, there is currently no substantial online presence for lottery games).

The physical gambling venues in Vanuatu, especially in Port Vila, have established themselves as significant attractions for tourists. Casinos such as the Grand Hotel and Casino provide various gaming opportunities, from baccarat to slots.

The primary pieces of legislation governing the gambling sector in Vanuatu include:

  • the Interactive Gaming Act 2000 (Cap 261) – governs online gambling activities and provides the framework for the regulation and licensing of online gaming operators (see 2.1 Online);
  • the Casino Control Act 1993 – regulates land-based casinos, detailing the licensing process and operational requirements for physical gambling venues (see 2.2 Land-Based);
  • the Lotteries Act 1989 – governs the operation of lotteries within Vanuatu (see 2. Jurisdictional Overview);
  • the AML/CTF Act 2014 – enforces AML/CFT protocols for all gambling operators (see 1.1 Current Outlook and Recent Changes (Increased enforcement and AML/CFT) and 8.1 AML Legislation); and
  • the Gaming (Control) Act 2018 (Cap 172) – regulates the gaming and gambling industry within Vanuatu, ensuring the protection of public interest and integrity, as well as compliance with money-laundering standards.

In Vanuatu, gambling is defined broadly to include activities where players stake money or valuable items on the outcome of games of chance or skill. This covers a wide range of gambling activities such as betting, lotteries, and casino games (online and land-based alike).

Land-based gambling refers to any form of gambling conducted in physical establishments, such as casinos, bingo halls, and betting shops. In Vanuatu, these establishments are regulated under the Casino Control Act 1993 (see 2.2 Land-Based and 3.1 Key Legislation) and related legislation. They are required to be licensed and comply with strict rules on player protection and responsible gaming.

Online gambling encompasses all forms of gambling conducted over the internet, including betting, casino games, and lotteries. In Vanuatu, the Interactive Gaming Act 2000 defines and regulates online gambling, requiring operators to obtain a licence from the VGA to provide such services (see 1.1 Current Outlook and Recent Changes and 2.1 Online).

Key offences under Vanuatu’s gambling laws include:

  • operating a gambling business without a licence;
  • offering gambling services to minors;
  • failure to comply with AML/CFT regulations; and
  • engaging in fraudulent activities related to gambling.

Penalties for violating gambling laws in Vanuatu can include substantial fines, imprisonment, and revocation of operating licences. Specific penalties depend on the severity of the violation, but authorities take strict action to ensure compliance with regulations.

Recent legislative changes in Vanuatu’s gambling sector include updates to the Interactive Gaming Act 2000 to streamline the licensing process. A VASP bill is forthcoming, which will regulate the use of blockchain and cryptocurrency in gambling operations.

As mentioned in 1.1 Current Outlook and Recent Changes, the key regulatory authority for gambling in Vanuatu is the VGA, operating under the DCIR. The VGA is responsible for administering both online and land-based gambling licenses and ensuring compliance with local gambling laws.

Vanuatu takes a risk-based approach to gambling regulation, with a focus on transparency, consumer protection, and AML requirements. The regulatory framework is designed to be business-friendly, while still ensuring that operators comply with strict rules on player protection and financial transparency. The emphasis on risk-based systems allows operators to implement measures based on the specific risks they face, such as their customer base or the jurisdictions in which they operate.

Recent changes include the launch of a streamlined online licensing system in July 2024, reducing the administrative burden on applicants. The forthcoming VASP legislation – expected to be enacted in 2025 – will introduce regulations for the use of cryptocurrency and blockchain technology in gambling operations, aligning Vanuatu with international standards such as those set by the FATF.

Vanuatu offers several types of gambling licenses, including:

  • interactive gaming licences – for online casinos, betting platforms, and other forms of iGaming;
  • land-based casino licences – for physical casinos operating within Vanuatu;
  • lottery licences – for lottery operators, both online and land-based; and
  • sports betting licences – for operators offering fixed-odds sports betting.

Licences are readily available to qualified applicants. The application process is streamlined, particularly for online operators, with minimal travel required as applications can now be submitted entirely online. Applicants must meet the necessary financial, technical and compliance requirements.

Licences are typically valid for a period of 15 years, with annual renewal requirements depending on the type of licence and compliance with the ongoing regulatory framework.

Key application requirements for operators include:

  • proof of company registration in Vanuatu;
  • detailed business and financial plans, demonstrating financial stability and the ability to meet player liabilities;
  • a robust AML and CFT policy in line with Vanuatu’s regulations; and
  • a complete description of the technical infrastructure used for online operations, including data security measures.

For online operators, the application process differs slightly from land-based operators, owing to the additional technical requirements (eg, IT security, payment processing systems, and data protection mechanisms).

The timing for licence applications has been streamlined with the new online application portal, allowing for quicker processing. The typical timeframe for receiving approval is within 60 days – although it may vary, depending on the complexity of the application and whether additional information is required by the authorities.

Application fees vary depending on the type of licence. By way of example, the Interactive Gaming Licence currently has an application fee of EUR5,000, with an additional EUR10,000 annual fee. Additional costs may include fees for background checks and compliance audits.

Annual fees vary depending on the specific licence but generally include a fixed component (such as the EUR10,000 fee for interactive gaming licences) and a variable component based on gross gaming revenue or wagering activity. By way of example, online operators are subject to a 1% tax on wagering activity, replacing previous models based on gross turnover.

As previously mentioned in 2.2 Land Based, land-based gambling in Vanuatu is governed by the Casino Control Act 1993, which outlines the requirements for establishing and operating physical casinos and gaming venues. Operators seeking to open a land-based gambling establishment must obtain a casino licence from the VGA. The application process includes the submission of a business plan, proof of financial stability, and compliance with local AML and responsible gaming regulations.

Premises must meet specific criteria, such as maintaining adequate security measures and ensuring that gaming activities are conducted fairly and transparently. Additionally, licences for land-based venues may have certain restrictions, including limits on gaming hours and entry requirements for patrons.

Vanuatu’s land-based gambling sector has seen modest growth, especially within the tourism industry, which has brought international visitors to venues such as the Grand Hotel and Casino in Port Vila (see 2.2 Land-Based). The government has emphasised the development of integrated resort casinos to boost the local economy.

While there have been no significant changes to the legal framework governing land-based casinos, operators are expected to comply with evolving AML regulations and ensure that their operations adhere to stricter standards for customer due diligence. Additionally, there is increasing focus on responsible gaming measures, particularly in terms of player protection and support for individuals at risk of gambling-related harm.

A B2C licence in Vanuatu allows operators to offer online gambling services directly to players. These licences cover a wide range of services, including casino games, sports betting, bingo, and poker. Operators must comply with Vanuatu’s regulatory requirements, which include player protection measures, responsible gaming policies, and adherence to AML regulations. The Interactive Gaming Act 2000 provides the legal framework for issuing these licences.

B2B licences are granted to entities that provide software, platforms and services to other gambling operators. B2B providers must ensure that their systems comply with the security and data protection requirements set by the VGA. B2B services include payment processing, game development, and data management solutions for licensed B2C operators.

Affiliates play a significant role in marketing and player acquisition for online gaming operators. Vanuatu does not have a dedicated regulatory framework for affiliate marketing, but operators are expected to ensure that affiliates comply with advertising standards, including those that promote responsible gaming and protect vulnerable individuals.

White-label providers in Vanuatu must adhere to the same regulatory requirements as standard operators. White-label licences allow third-party companies to operate under the branding of a licensed operator, using the licensed operator’s platform and gaming infrastructure. These arrangements must meet all licensing and compliance standards, including AML and responsible gaming measures.

Vanuatu mandates that online operators implement technical measures to protect consumers from unlicensed operators and ensure the security of payments. This includes using IP blocking to restrict access to unlicensed sites and encryption technologies to secure player data. Operators must also comply with data protection regulations and ensure that their systems are safeguarded against hacking or fraudulent activities.

The online gambling sector in Vanuatu has seen significant regulatory improvements, including the streamlining of the application process and updates to licensing fees. In addition, the forthcoming cryptocurrency regulations will enable operators to incorporate blockchain technology and cryptocurrency into their platforms, offering new opportunities for innovation and growth.

Vanuatu has implemented a comprehensive set of responsible gambling requirements to ensure that operators protect vulnerable players and promote safe gambling environments. These requirements include:

  • mandatory display of responsible gambling messages, such as “Gamble Responsibly”, on all marketing materials;
  • self-exclusion options for players who wish to limit or suspend their gambling activity; and
  • clear communication of terms and conditions related to gambling products, particularly around bonuses and promotions.

Operators are expected to provide players with easy access to information about gambling risks, as well as resources to assist with problem gambling ‒ for example, referral services to gambling support organisations.

Key gambling management tools in Vanuatu include:

  • deposit limits – players can set daily, weekly or monthly deposit limits to manage their gambling expenses;
  • time limits ‒ players may also impose time limits to control how long they spend on gambling activities; and
  • self-exclusion ‒ operators are required to offer players the option to self-exclude from gambling for a specified period or permanently, as this is an essential tool for those experiencing gambling-related harm.

In response to global trends, Vanuatu is gradually introducing more stringent responsible gambling measures. These include expanded public awareness campaigns, partnerships with support organisations, and increased regulatory oversight to ensure that operators comply with their obligations. Additionally, the government has committed to reviewing and updating its responsible gambling policies regularly to align with international best practices.

As mentioned in 1.1 Current Outlook and Recent Changes (Increased enforcement and AML/CFT), Vanuatu’s AML framework is governed by the AML/CTF Act 2014. This legislation requires all gambling operators to implement robust AML and CFT policies. The key AML legislation includes strict requirements for customer due diligence (CDD), record-keeping, disclosing information and reporting suspicious transaction reporting.

Operators in Vanuatu are obligated to:

  • perform CDD, including verifying the identity of players before allowing them to gamble;
  • report suspicious activities to the Financial Intelligence Unit (FIU) and disclose confidential information where relevant;
  • maintain adequate records of all transactions for at least five years to ensure they can be reconstructed if necessary;
  • appoint an AML Compliance Officer to oversee all AML/CFT activities within the organisation;
  • conduct regular risk assessments to identify potential money-laundering risks and mitigate them effectively; and
  • submit an annual report to the Minister of the FIU, detailing compliance with gaming regulations, operational activities and financial performance.

There has been an increased focus on enhancing the AML/CFT regulations in Vanuatu, particularly with the forthcoming introduction of the VASP bill. As mentioned in 4.3 Recent or Forthcoming Changes, this legislation will regulate the use of cryptocurrencies in the gambling sector, aligning Vanuatu with international standards like those set by the FATF.

The VGA, in conjunction with the DCIR, oversees the regulation of gambling-related advertising in Vanuatu. Their role includes enforcing standards to ensure advertisements comply with responsible gambling requirements and protect vulnerable groups.

In Vanuatu, advertising is broadly defined as any form of promotional communication regarding gambling services, whether through digital platforms, print media, social media, or traditional broadcast channels.

Gambling operators in Vanuatu must ensure their advertisements:

  • comply with local laws, such as the Interactive Gaming Act 2000;
  • include responsible gambling messages such as “Gamble Responsibly”;
  • are not misleading and clearly state terms and conditions related to bonuses or promotions; and
  • do not target vulnerable groups, including minors (see 9.4 Restrictions on Gambling) and problem gamblers.

Specific restrictions apply to gambling advertising in Vanuatu, as follows.

  • Advertisements must not be directed at minors or suggest that gambling is a solution to personal or financial problems.
  • Marketing materials cannot use themes, imagery or language likely to appeal to minors.
  • Sponsorships and endorsements must comply with advertising standards, ensuring that gambling is not promoted during events primarily attended by minors.

Operators who breach advertising regulations may face penalties such as:

  • fines (see 11.3 Financial Penalties);
  • suspension or revocation of licences; and
  • removal or modification of non-compliant advertisements.

Recent changes to the advertising framework emphasise responsible gambling and protecting vulnerable groups. Operators are expected to demonstrate compliance with advertising restrictions and increased scrutiny from the VGA is anticipated to ensure responsible advertising practices.

When there is an acquisition or change of control in a gaming company in Vanuatu, the primary requirement is full disclosure of the ultimate beneficial owners (UBOs). This includes submitting information such as ownership structure, financial stability, and background checks to the VGA. The process ensures transparency and compliance with AML laws.

A change of control is triggered when a significant percentage of ownership (typically 25% or more) changes hands or when a new board member or director assumes a controlling role in the company. This requires the VGA’s approval and additional documentation regarding the new controlling party.

For passive investors, there are fewer stringent requirements than there are for direct owners. However, passive investors must still disclose their shareholding percentage and comply with KYC procedures. Passive investors are not involved in the day-to-day management of the company but must ensure transparency regarding their investment.

There have been no significant recent changes to the rules governing acquisitions and changes of control in Vanuatu’s gaming sector. However, with the introduction of cryptocurrency regulations and the VASP bill, there may be more stringent requirements on the disclosure and handling of digital assets in acquisitions.

The VGA and the DCIR have broad enforcement powers to regulate both online and land-based gambling operations. These authorities can conduct investigations, issue fines, revoke licences, and suspend operations of non-compliant operators. The VGA is responsible for ensuring that all licensees adhere to the gaming laws and that their operations are free of illegal activities, including fraud and money laundering.

Sanctions in Vanuatu’s gaming industry include financial penalties, suspension, and revocation of licences. The VGA and the DCIR work to ensure that operators comply with local regulations. Repeat or severe violations may lead to permanent bans from operating within the jurisdiction.

Financial penalties in Vanuatu are generally imposed in cases of non-compliance with gambling regulations, AML/CF requirements, or advertising rules. The amount of the fine is typically determined based on the severity of the violation and may increase for repeated offences. Financial penalties aim to ensure compliance and deter future breaches.

With Vanuatu updating its AML/CFT laws and adopting new cryptocurrency regulations, enforcement efforts have been heightened. There is a greater focus on AML compliance, particularly in the growing cryptocurrency space, as the upcoming VASP bill is expected to increase the regulatory oversight for operators using digital assets.

Vanuatu’s tax structure for gambling operators is favourable compared to other jurisdictions. For online gambling, there is a 1% tax on wagering activity. This tax replaces earlier tax structures based on gross gaming revenue or turnover. Land-based casinos are also subject to tax – although specific rates can vary depending on the size and scope of the operations.

There have been no significant changes to the gambling tax rates recently. However, as part of Vanuatu’s ongoing regulatory evolution, there could be adjustments – particularly in relation to online gaming and the impending introduction of cryptocurrency-based gambling.

In Vanuatu, personal authorisations and licences are required for individuals who hold significant roles in gambling operations ‒ for example, directors, managers, or shareholders with a substantial ownership interest (typically 25% or more). Licences are available both for online and land-based gambling operations. Personal approvals are required to ensure that key individuals meet regulatory and ethical standards.

The application process requires background checks on all key individuals, including criminal history, financial stability, and a detailed review of their professional experience. Applicants must submit proof of identity, financial records, and a detailed KYC review to ensure compliance with AML/CFT regulations. For shareholders, there may be additional disclosure requirements based on the level of ownership interest. Applications are generally processed within 60 to 90 days.

Annual fees for personal licences are generally tied to the operational scale of the business. Individuals must pay these fees annually to retain their authorisations and failure to comply can result in penalties or revocation of the licence.

Once approved, individuals must comply with AML/CFT regulations, participate in regular audits, and ensure continued adherence to gaming laws. They are also responsible for maintaining ethical standards and ensuring that the company’s operations align with the responsible gambling principles.

Regulatory bodies have the authority to impose sanctions, including fines, suspension, or revocation of personal licences, if individuals are found to violate gambling laws or regulatory requirements. Non-compliance with AML/CFT requirements, fraud, or unethical practices are grounds for penalties.

With the increasing focus on blockchain and cryptocurrency integration in the gaming industry, personal approval requirements may evolve to account for the specific expertise required in handling virtual assets. This is particularly relevant with regard to the forthcoming VASP regulations, which are expected to introduce new compliance standards for individuals involved in cryptocurrency-based gaming.

MannBenham Advocates Limited

49 Victoria Street
Douglas
Isle of Man

+44 (0)1624 639350

enquiries@mannbenham.com www.mannbenham.com
Author Business Card

Trends and Developments


Authors



MannBenham Advocates Limited has more than 25 years of industry expertise and acts as a trusted partner in unlocking the lucrative potential of Vanuatu’s online gambling market. The firm’s comprehensive services, from securing Vanuatu gaming licences to ensuring full legal and regulatory compliance, guarantee a seamless set-up for any business. The team handles everything ‒ application preparation, liaising with authorities, corporate governance, and ongoing compliance ‒ so clients can focus on growing their business. With a low-tax regime, efficient licensing processes, and MannBenham’s expert guidance, there is no better time to take advantage of Vanuatu’s attractive gaming environment.

Exploring the Evolution of Gaming in Vanuatu: A Growing Industry on the Rise

In recent years, Vanuatu has emerged as a notable player in the global gaming industry, driven by its favourable regulations, strategic location, and a robust commitment to compliance through the Consolidated Anti-Money Laundering and Counter-Terrorism Financing Act No 13 of 2014 (the “AML/CTF Act 2014”). While gaming continues to be a highly dynamic and evolving sector, Vanuatu’s approach reflects a balance between embracing modern trends and developments and maintaining strict compliance with international standards. This article delves into Vanuatu’s gaming trends, explores its regulatory landscape, and highlights how the nation is positioning itself as a competitive and responsible player in the gaming industry.

Vanuatu’s growing gaming sector

Vanuatu has seen substantial growth in its gaming sector, particularly in the online and interactive gaming space. The jurisdiction has attracted numerous international operators, thanks to its relatively low operational costs, favourable tax regime, and the presence of a well-structured legal framework. The Vanuatu Interactive Gaming Act 2000, in particular, has paved the way for a wide range of gaming businesses ‒ from online casinos to sports betting platforms ‒ allowing them to establish themselves and thrive in a regulated environment.

The government’s approach, which encourages both domestic and international investment, positions Vanuatu as a gateway to the Asia-Pacific gaming market. By leveraging the growing demand for online gaming and implementing measures to enhance its technological infrastructure, Vanuatu has become an attractive destination for operators looking to capitalise on the surge in mobile and digital gaming.

Current trends in Vanuatu’s gaming industry

Rise of mobile gaming

With mobile penetration at an all-time high globally, Vanuatu’s gaming market is no exception to this trend. Mobile gaming, in particular, has taken off ‒ with many operators focusing on mobile-friendly platforms to cater to a growing audience of gamers who prefer the convenience of gaming on the go. According to recent reports, mobile gaming accounts for a significant portion of global gaming revenue, and Vanuatu’s operators are investing in mobile optimisation to remain competitive in the market.

Embracing cryptocurrency and blockchain technology

As cryptocurrency continues to gain acceptance worldwide, it has become an increasingly popular payment method within Vanuatu’s gaming industry. The adoption of cryptocurrencies such as Bitcoin and Ethereum offers players anonymity, fast transaction speeds, and lower fees ‒ all of which align with the needs of a digital-savvy audience. Furthermore, some operators in Vanuatu are experimenting with blockchain technology in order to enhance transparency, improve security, and offer new forms of gaming, such as blockchain-based betting platforms.

Focus on compliance and responsible gaming

Vanuatu has maintained a strong focus on compliance and responsible gaming, driven largely by the AML/CTF Act 2014, which mandates that reporting entities (including gaming operators) implement rigorous measures to prevent money laundering and the financing of terrorism. This focus on compliance not only protects players but also reinforces the integrity of Vanuatu’s gaming industry. Vanuatu’s gaming operators are required to implement strict KYC policies, continuous monitoring of transactions, and regular audits to ensure compliance with the AML/CTF Act 2014.

Impact of AML/CTF Act 2014 on Vanuatu’s gaming sector

The AML/CTF Act 2014, enacted to align Vanuatu with global AML/CFT standards, has had a profound impact on the gaming sector. The AML/CTF Act 2014 mandates that all reporting entities (including gaming operators) adhere to stringent registration, monitoring and reporting requirements. What follows is a closer look at how the AML/CTF Act 2014 is shaping the industry.

Establishment of Financial Intelligence Unit (FIU)

The FIU plays a crucial role in overseeing compliance within the gaming sector. It is responsible for maintaining a registry of all reporting entities, including gaming operators, and ensures that these entities meet their AML obligations. By monitoring and analysing suspicious transaction reports, the FIU helps to identify and mitigate potential risks related to money laundering and terrorism financing.

Obligations for reporting entities

Under the AML/CTF Act 2014, reporting entities in Vanuatu’s gaming industry must implement comprehensive compliance programmes. These programmes include the appointment of an AML/CFT Compliance Officer, establishing and maintaining procedure manuals, conducting regular risk assessments, and adhering to record-keeping requirements. Operators are also required to report any suspicious activities and transactions to the FIU within two working days. Non-compliance with these regulations can result in significant penalties, including fines and imprisonment.

Customer due diligence and enhanced due diligence

Customer due diligence is a cornerstone of the AML/CTF Act 2014. Gaming operators in Vanuatu must verify the identity of their customers, understand the nature of the customer’s activities, and monitor transactions to detect suspicious behaviour. For high-risk customers, such as those from jurisdictions with weak AML frameworks, operators must apply enhanced due diligence measures. These measures include obtaining additional information about the customer and conducting more frequent transaction monitoring.

Challenges and opportunities for gaming operators in Vanuatu

Although the AML/CTF Act 2014 provides a robust framework for compliance, it also poses challenges for operators, who must balance these requirements with the need to innovate. Gaming companies in Vanuatu are investing in advanced technologies (such as AI and machine learning) to streamline compliance processes, reduce operational costs, and improve the customer experience. These technologies allow operators to automate transaction monitoring, identify suspicious activities and enhance data security, ultimately creating a safer and more efficient gaming environment.

Navigating the complexities of cross-border gaming

Vanuatu’s gaming operators often engage in cross-border activities, offering their services to international players. However, operating in multiple jurisdictions adds layers of complexity to compliance efforts. In addition to adhering to the AML/CTF Act 2014, operators must also navigate the regulatory landscapes of the countries in which their players reside. This can be particularly challenging given the variations in AML requirements and the need to establish correspondent banking relationships. The FIU’s guidance and support are crucial for operators seeking to manage these challenges while remaining compliant with Vanuatu’s AML obligations.

Harnessing the potential of emerging markets

As the demand for online gaming grows across the Asia-Pacific region, Vanuatu-based operators are well positioned to expand into emerging markets. Countries with rapidly increasing internet penetration rates and growing middle-class populations present significant opportunities for gaming companies. Vanuatu’s regulatory framework, which emphasises both compliance and flexibility, allows operators to adapt their offerings to meet the needs of diverse markets. By leveraging their experience in regulated environments, Vanuatu’s gaming companies can capitalise on the growing appetite for online and mobile gaming in neighbouring regions.

Future of gaming in Vanuatu

Looking ahead, Vanuatu’s gaming industry is poised for continued growth and evolution. The country’s commitment to maintaining a balanced regulatory environment, combined with its openness to innovation, will likely attract more gaming operators seeking a reputable and supportive jurisdiction. Furthermore, as global gaming trends continue to evolve, Vanuatu is expected to remain at the forefront by leveraging its strategic location, regulatory expertise, and technological advancements to strengthen its position in the gaming world.

Expanding the scope of regulation

As gaming trends shift, the scope of regulation in Vanuatu may expand to encompass new forms of gaming, such as esports betting and virtual reality casinos. These emerging trends offer exciting opportunities but also introduce new risks, particularly in terms of player protection and data security. By proactively addressing these challenges, Vanuatu’s regulators can ensure that the country remains an attractive destination for gaming operators while safeguarding the interests of players and the broader community.

Strengthening partnerships and collaboration

To further enhance its regulatory framework, Vanuatu is likely to continue building partnerships with international organisations, such as the Financial Action Task Force (FATF) and regional gaming associations. These collaborations will enable Vanuatu to stay up-to-date with global best practices, access valuable resources, and strengthen its position as a leader in the gaming industry. By working closely with other countries, Vanuatu can also enhance its capacity to combat financial crimes and foster a more transparent and secure gaming environment.

Conclusion

The gaming industry in Vanuatu is experiencing a period of rapid transformation, driven by technological advancements, evolving consumer preferences, and a commitment to regulatory excellence. As the country continues to attract international gaming operators, its focus on compliance through the AML/CTF Act 2014 sets it apart as a responsible and forward-thinking jurisdiction. By embracing innovation, fostering collaboration, and adapting to changing trends, Vanuatu is well positioned to thrive in the global gaming landscape for years to come.

In conclusion, Vanuatu’s proactive approach to gaming regulation ‒ combined with its embrace of modern trends and technologies ‒ underscores its potential as a prominent player in the gaming world. As the industry continues to evolve, Vanuatu’s dedication to fostering a secure, transparent and compliant gaming environment will ensure its continued success and relevance in an ever-competitive market.

MannBenham Advocates Limited

49 Victoria Street
Douglas
Isle of Man

+44 (0)1624 639350

enquiries@mannbenham.com www.mannbenham.com
Author Business Card

Law and Practice

Authors



MannBenham Advocates Limited has more than 25 years of industry expertise and acts as a trusted partner in unlocking the lucrative potential of Vanuatu’s online gambling market. The firm’s comprehensive services, from securing Vanuatu gaming licences to ensuring full legal and regulatory compliance, guarantee a seamless set-up for any business. The team handles everything ‒ application preparation, liaising with authorities, corporate governance, and ongoing compliance ‒ so clients can focus on growing their business. With a low-tax regime, efficient licensing processes, and MannBenham’s expert guidance, there is no better time to take advantage of Vanuatu’s attractive gaming environment.

Trends and Developments

Authors



MannBenham Advocates Limited has more than 25 years of industry expertise and acts as a trusted partner in unlocking the lucrative potential of Vanuatu’s online gambling market. The firm’s comprehensive services, from securing Vanuatu gaming licences to ensuring full legal and regulatory compliance, guarantee a seamless set-up for any business. The team handles everything ‒ application preparation, liaising with authorities, corporate governance, and ongoing compliance ‒ so clients can focus on growing their business. With a low-tax regime, efficient licensing processes, and MannBenham’s expert guidance, there is no better time to take advantage of Vanuatu’s attractive gaming environment.

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