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VAT Guidelines
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In this paper, the Lotteries and Gaming Authority (LGA) sets out the basis for defining 'services that are strictly, required, related and essential, and which form part of the on-line gaming transaction itself and in respect of which transaction the company is licensed in terms of the Remote Gaming Regulations, 2004'.

As a further guide to interpretation, this paper includes the following two lists:

  • List 1: list of services which fall within the definition and
  • List 2: list of services that do not fall within the definition

Methodology

The criteria that have been used to establish which services are "related to gambling" were determined on the basis of whether the particular service is:

  1. strictly required, related and essential; and
  2. forms part of the on-line gaming transaction itself; and
  3. in respect of which transaction the company is licensed in terms of the Remote Gaming Regulations, 2004.

A number of services that are typically acquired by gaming companies have been identified and each such service was appraised against each part of the definition. Services which fall within the on-line gaming transaction itself are considered to fulfill all three parts of the definition. A gaming transaction necessarily involves the cycle covering the activities where the player registers with a gaming company, funds the accounts, plays the game and cashes out.

Conversely, services that do not form part of the gaming transaction itself but support the gaming infrastructure that acts as the delivery mechanism of the game to the remote player and the administrative operations of the gaming company do not meet the above criteria.

The lists are intended to cover a significant part of the typical services acquired by remote gaming companies. However, it is not exhaustive. There may be services which do not clearly fall under the headings contained in the two Lists. In such cases, remote gaming companies may present to the LGA the specific characteristics of the particular service, the circumstances in which it is acquired, and how and why it meets the above criteria resulting in it falling within or outside the definition. Where the LGA considers that this service may also be acquired by other operators, reference to the type of service may be made in the appropriate List.

List of Services

Services that are considered to be strictly, required, related and essential, and which form part of the on-line gaming transaction itself and in respect of which transaction the company is licensed in terms of the Remote Gaming Regulations, 2004 Guidance Note Services that are not considered to be strictly, required, related and essential, and which form part of the on-line gaming transaction itself and in respect of which transaction the company is licensed in terms of the Remote Gaming Regulations, 2004 Guidance Note
A1.0 Fraud Prevention B1.0 Marketing
A1.1 Identification and Verification of Players B1.1 Advertising
A1.2 KYC Services B1.2 Promotional Material
A1.3 System Hardening Software
A1.4 Player anti-fraud Management Services B2.0 Technical and Hardware Supply Services
A1.5 AML Procedures B2.1 Hosting
A1.6 Payout Management Services B2.2 Connectivity and Telecommunications
B2.3 DRP and BCP Provision
A2.0 Game B2.4 Hire of IT Equipment
A2.1 Integrity Checks B2.5 Hardware Maintenance and Support Services
A2.1.1 Game Logic and Integrity Checks
A2.1.2 RNG Testing B3.0 Telecommunications
A2.1.3 Sport Integrity Checks B3.1 Telephony
A2.2 Gaming Software B3.2 Mobile Telephony
A2.2.1 Gaming Software Licensing Fees/Purchase Cost B3.3 Office Connectivity
A2.2.2 Licensing Fees Purchase Cost of software that processes information related to all game/player interaction B4.0 Professional Fees
B4.1 Legal Fees
B4.2 Consultancy Fees
A2.2.3 Software maintenanceand support services B4.3 Management Services
B4.4 Accountancy & Audit Fees
A2.3 System Integration Costs B4.5 Administration Rent/Hire
A2.4 Game Collusion Management B4.6 Key Official Support Services 4
A3.0 Risk Management B5.0 Staff Costs
A3.1 Event Management/Event Purchase B5.1 Staff Recruitment Fees
A3.2 Odds Management/Odds Purchase B5.2 Staff Retention
A3.3 Results Management/Results Purchase B5.3 Training
B5.4 Welfare Services
A4.0 Player Support
A4.1 Player Support Services 1 B6.0 Administration
A4.2 Responsible Gaming Measures 2 B6.1 Office Rent
6.2 Repairs and Maintenance
A5.0 Intermediaries 6.3 Cleaning Costs
A5.1 Intermediaries Commission 3
B7.0 Other Costs
A6.0 Payment Solutions B7.1 Research and Development
A6.1 Payment Service Provider Fees B7.2 Travel and Entertainment
B7.3 Attending Conferences, Seminars etc

Guidance Notes

  1. Player Support Services: includes all services undertaken by a gaming company to support a player on matters related to the on-line gaming transaction, as from when the player logs on to the gaming system, funds the account, during a game session and cashes out, including complaints handling.
  2. Responsible Gaming Measures: includes all costs incurred by a gaming company with respect to affiliation/qualification with responsible gaming organizations.
  3. Intermediaries: includes betting agents, affiliates, skins and white labels. Such intermediaries form part of the supply chain and work as agents on behalf of the gaming company. Companies which carry out marketing activities on behalf of the gaming companies such as web forwarders are not considered to be intermediaries.
  4. Key Official Support Services: includes support services offered by entities to assist Key Officials in carrying out their role.


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