Romania’s ONJN Updates Joint Venture Regulations

Romania’s ONJN Updates Joint Venture Regulations: Key Impacts on the Gambling Industry

Romania’s gambling market continues to evolve with the Romanian National Office for Gambling (ONJN) releasing new regulations under Order 771/2024. Effective as of August 29, this order outlines how joint ventures between B2B and B2C operators should be structured in the Romanian gambling landscape. This update is set to redefine collaboration standards, offering both opportunities and challenges for businesses. But what does this mean for operators looking to navigate one of Europe’s most promising gambling markets? Let’s dive into the specifics of this new regulation and its implications for the industry.

A New Framework for Joint Ventures in Romanian Gambling

Order 771/2024, titled the Joint Operation of Gambling Activities, is designed to provide a clearer framework for how B2B and B2C operators can legally collaborate in Romania. It mandates that companies holding a Class I and/or Class II license can jointly operate gambling activities, provided they enter into written contracts that comply with the law. This agreement must explicitly define the roles and responsibilities of each party involved, ensuring that both sides are equally accountable for the venture’s operations.

The ONJN’s order states that any prior regulations contradicting these new rules are now repealed, reflecting the regulator’s effort to streamline and modernize the legal landscape for joint ventures in Romania. Published in the Official Gazette of Romania, Part I, this order adds to the complex legal fabric of Romanian gambling, which includes Competition Law No. 21/1996, Fiscal Code Law No. 227/2015, and Civil Code Law No. 287/2009.

The Intent and Criticism of ONJN’s Joint Venture Order

While the ONJN’s intention is to provide clarity, some in the industry have noted that the order lacks detailed guidance on structuring joint ventures between B2C operators and B2B providers. The regulator’s language closely mirrors existing laws, leading to concerns that it does not adequately address specific scenarios that operators might encounter. This has sparked criticism from industry stakeholders who believe that more precise directives are needed to facilitate seamless collaborations between licensed entities.

The order is set against a backdrop of recent amendments that restrict joint ventures to B2B providers holding a Class 2 license. This contrasts with past practices where many land-based operators entered joint ventures with unlicensed partners. The current framework aims to tighten these relationships, ensuring that only regulated, licensed entities can partake in joint operations, thereby enhancing market integrity and consumer protection.

Market Impact: A Thriving Environment Despite Regulatory Hurdles

Romania’s gambling market has seen a surge in activity, driven by new entrants and increased demand for licenses. In February, the industry anticipated a wave of brands applying for Romanian licenses or partnering with local operators, a trend that has shown no signs of abating. Despite increased operational taxes introduced in October 2023, which nearly doubled for some license holders, the market’s allure remains strong, drawing interest akin to the booming gaming environment seen in Ontario.

Since June, companies like Booming Games, Oddsgate, ThrillTech, 8 Dex Global, TurboDev, and 3 Oaks Gaming have either been awarded licenses or commenced operations in Romania. Additionally, prominent players like Wazdan have expanded their footprint, partnering with established brands such as Winmasters to bolster their presence. This flurry of activity underscores the market’s stability and growth potential, making it a hotspot for both domestic and international operators.

The updated joint venture order is unlikely to deter this momentum. With 446 Class 2 licenses already issued for suppliers in the gambling sector, the order reinforces existing regulations without imposing new, restrictive barriers. It serves as a reminder of the legal expectations placed on joint ventures but stops short of being a game-changer that could slow the current market pace.

What’s Next for Operators in Romania?

The new ONJN order is part of a broader regulatory shift aimed at fostering a more transparent and controlled gambling environment in Romania. While it may not provide exhaustive guidance on joint venture structures, it solidifies the requirement for clear, lawful agreements between licensed entities. For operators, this means staying vigilant and ensuring compliance with both the letter and spirit of the law when forming partnerships.

The Romanian market continues to be an attractive proposition despite regulatory tweaks, as brands see substantial value and growth potential. The introduction of well-defined joint venture agreements could further strengthen market integrity, attract more investment, and create a robust environment where licensed operators can thrive.

The ONJN’s updated joint venture order is a significant, albeit not revolutionary, step in refining the legal landscape of Romania’s gambling industry. By tightening the rules around collaborations between B2B and B2C operators, the ONJN aims to ensure a regulated and compliant market. Although some stakeholders argue that the order lacks the specificity needed for effective implementation, the underlying message is clear: Romania’s gambling market is poised for continued growth, supported by a regulatory framework that prioritizes transparency and accountability. For operators eyeing this dynamic market, the message is simple—stay compliant, be strategic, and capitalize on the opportunities that Romania’s evolving landscape has to offer.