Poland sees decline in offshore market share

12 March 2020

The Polish Ministry of Finance has revealed that the market share for so-called ‘grey’ operators fell to 18.5% in 2019, below the average across the European Union (EU).

Based on data from industry analysts H2 Gambling Capital, the current EU average for grey operators stood at 26.5% in 2019. H2 based these findings on the average net revenue of such operators across EU countries.

Poland classifies grey operators as those that are located outside of a country but offer online gambling to players inside the regulated jurisdiction, without regulatory approval.

The 2019 figure for Poland is down from 29.1% in 2018, 39.4% in 2017 – when the country’s Gambling Act was amended – and a significant decline on 2016's grey market share of 79.4%.

Grey market share also fell year-on-year during the same period in the EU, with the average dropping from 40.5% in 2016 to 33.5% in 2017 and then 31.0% in 2018.

However, H2 said the EU results do not include the unregulated Luxembourg market, nor the UK, Ireland or Malta, as they all allow operators to offer igaming without a local licence.

In terms of specific market areas in Poland, grey operators accounted for 8.8% of the country’s online sports betting market in 2019, compared to the EU average of 25.2%.

Meanwhile, grey operators were responsible for 55.3% of revenue in the Polish online casino market, down from 98.2% in 2018 and 100.0% in both 2017 and 2016. The EU average for 2019 stood at 45.2% for the casino sector last year.

Analysing the H2 report, the Ministry of Finance said the findings are evidence that the legal framework in Poland is working. Current measures in place include the abiltiy to request that internet service providers block access to the offshore operators.

The new report comes after a figures released by legal association Graj Legalnie in January showed that regulated bookmakers in Poland generated combined turnover of PLN6.7bn (£1.36bn/€1.54bn/$1.71bn) in 2019, a 28.8% year-on-year increase but less than the unlicensed market.

Graj Legalnie suggested increased activity from unlicensed operators has meant that they grey market now makes up almost 60% of the overall Polish gaming market.

This came after a Polish Supreme Audit Office last September found that while the regulated gambling industry had grown rapidly following amendments to the country’s Gambling Act in 2017, it is still dwarfed by the illegal market.