Estonia Updates Gambling Act: Stronger AML Controls, Crypto Assets, and Reduced Gambling Tax Rates from 2026

On 18 December 2025, Estonia took a significant step toward modernising and strengthening its gambling regulatory framework. The President of Estonia promulgated amendments to the Gambling Act, which will enter into force on 1 January 2026.

The updated framework aims to ensure that the Estonian gambling market remains fair, transparent, and well supervised, while balancing effective anti–money laundering (AML) and counter-terrorist financing (CTF) safeguards with a competitive and sustainable business environment.

1. Objectives of the Amendments

The core purpose of the amendments is to shape a gambling sector in which:

• the gambling market operates in a fair and transparent manner;

• communication between gambling operators and the Estonian Tax and Customs Board (EMTA) is clear and effective; and

• money-laundering and terrorist-financing risks are identified, assessed, and mitigated in cooperation with the Financial Intelligence Unit (FIU).

In pursuing these objectives, the legislator has expressly ensured that the amendments:

• do not reduce tax revenues,

• do not impose disproportionate additional costs on operators, and

• do not increase unnecessary administrative burden.

2. Why the Changes Were Necessary

The amendments were considered essential due to identified weaknesses in the sector. Supervisory findings of the FIU indicate that some gambling operators holding Estonian operating licences may not fully comply with AML/CTF requirements, potentially facilitating money laundering.

Risk assessments in the gambling sector have consistently highlighted:

• remote (online) gambling, and

• foreign-owned or foreign-connected operators

as elevated risk areas. The growth of remote gambling has been driven largely by non-resident players, including players from countries classified as having high or very high money-laundering risk.

Against this background, the legislator concluded that additional safeguards were required, particularly at the licensing and supervisory stage, even though stricter requirements may result in a lower number of licence applications, especially among smaller market participants.

3. Key Regulatory Changes

   Enhanced Licensing and Supervision

   • The EMTA will assess gambling operating licence applications against expanded compliance criteria, including AML/CTF requirements.

   • The FIU will be formally involved in the assessment of AML-related risks during the licensing process.

   • Data and documentation submitted with licence applications will follow the framework set out in Section 70(3) and 70(3¹) of the Money Laundering and Terrorist Financing Prevention Act.

   Mandatory Auditor Oversight

   • Gambling operators will be subject to mandatory audit of their annual financial statements.

   • Auditor reviews must include more detailed assessments, strengthening financial transparency and regulatory trust.

   Crypto-Assets Formally Recognised

   • Crypto-assets are now explicitly recognised as part of bets, bringing regulatory clarity to their use within the gambling sector.

   Stricter Payment Channel Requirements

   • Remote gambling bets must be processed via licensed payment institutions within the EEA, reinforcing AML safeguards and limiting exposure to unregulated payment flows.

   • The “closed-loop” principle has been strengthened to improve traceability of funds and player protection.

   Updated Definitions and Business Flexibility

   • The legal definition of remote gambling has been expanded to clearly cover electronic participation outside traditional gambling venues.

   • Operators are permitted to engage in broader business activities, subject to continued compliance with licensing and AML requirements.

   Increased Sanctions for Non-Compliance

   • Administrative fines and penalties have been significantly increased, underscoring the regulator’s stricter enforcement stance.

4. Crypto-Assets and Gambling Regulation

The amended Gambling Act expressly recognises crypto-assets as part of bets, providing long-awaited regulatory clarity for their use in the Estonian gambling sector. This development aligns Estonia’s gambling framework with broader EU digital finance and AML standards, while bringing crypto-based gambling activity within the scope of full regulatory oversight.

The use of crypto-assets is subject to enhanced AML/CTF controls, including strict compliance with the closed-loop principle and the requirement that payment flows be processed through licensed institutions within the EEA. In practice, this means that gambling operators offering crypto-asset-based betting must ensure full traceability of funds, robust customer due diligence, and effective transaction monitoring.

By formally integrating crypto-assets into the gambling regulatory framework, Estonia aims to balance technological innovation with financial integrity, enabling responsible use of digital assets without compromising supervisory effectiveness or market transparency.

5. Gambling Tax Rate Reductions

Alongside stricter compliance requirements, the amendments introduce a gradual reduction of gambling tax rates for games of chance and games of skill offered as remote gambling.

• From 1 January 2026: tax rate reduced to 5.5%

• Further reductions planned, reaching 4% by 1 January 2029

These changes abolish the previously planned increase of the gambling tax rate to 7%, reflecting Estonia’s intention to maintain a balanced and competitive regulatory environment, while ensuring that gambling activity remains within socially acceptable limits.

6. Transition Period

7. Existing gambling operators must bring their operations into compliance with the new requirements by 1 January 2027.

7. Conclusion

The amended Gambling Act represents a dual-track reform:on the one hand, it significantly strengthens AML/CTF oversight, supervisory cooperation, and transparency; on the other, it enhances Estonia’s attractiveness as a regulated gambling jurisdiction through tax relief and regulatory clarity, including for crypto-asset use.

For operators, the changes require early preparation, particularly in the areas of licensing documentation, AML governance, payment flows, and audit readiness.