New ‘technical measures and reforms’ specific to how sports betting businesses can operate will be introduced to Hungary’s Gambling Act (1991).
The amendments have been drafted by SZTFH, the Supervisory of Regulatory Affairs which oversees policy development for gaming, tobacco, cyber-security and insolvency practices.
SZTFH reforms are required due to Hungary adopting new legislation in 2022 to liberalise the country’s sportsbook marketplace – in which it chose to end its existing monopoly regime operated by state-run gambling operator Szerencsejáték Zrt.
Since 2017, the European Court of Justice (CJEU) has urged that Hungary change its sports betting laws, in which it determined that Hungary had sanctioned unfair conditions on foreign businesses in favour of its national monopoly.
At the start of the year, Hungary’s Parliament approved for the state-monopoly system to be replaced by a ‘competitive licensing process’, to allow for new operators to compete in the market.
Presenting its initial market reforms, SZTFH has outlined that operators must have a minimum of five years of experience in offering licensed online gaming in a European Economic Area (EEA).
The agency stated that any business that has been involved in providing unlicensed gambling services to Hungarian consumers within a ‘five year period of its application date’ will be disqualified from the market.
Applicants must prove to SZTFH that they have a capital reserve minimum of HUF1bn (€2.8m), as the agency will charge a licence fee of HUF600m (€1.6m)
SZTFH has recommended for sports betting to be taxed at 15% gross gambling revenue (GGR), with a further 2.5% net charge won’t be applied as a ‘supervision fee’ capped at HUF10m (€29,000).
The regulator’s decree puts the amended Gaming Act into effect at the state agency level, introducing a new safer gambling feature for early cash outs in Hungary.
According to SZTFH, licensed incumbents must explicitly inform players about the increased risk of excessive gambling and addiction associated with the use of the early cash-out function. This information must be prominently displayed in promotional texts and on the gambling website.
As of 29 March, the SZTFH has not approved any foreign operators to launch in Hungary, only granting a license to the state-owned former monopoly Szerencsejáték Zrt, which operates the Tippmixpro brand.
Three Hungarian land-based casinos also received approval to offer online casino services through tethered licenses.
Preparing for the market’s overhaul, Szerencsejáték Zrt announced that it would re-launch its Tippmix brand in partnership with EveryMatrix as its new lead technology supplier.