The Dutch Court of Appeal in Hertogenbosch recently ruled that the Dutch authorities may not levy taxes on any winnings earned by players on

A key factor in its judgment was that the Malta-based Rational Gaming Europe Limited was deemed to be the "organiser" (in Dutch: 'houder') of the poker games offered on According to the Dutch legislator and Supreme Court, the entity that has "control" over the organisation of the games of chance is considered to be the organiser of such games. This decision, handed down on 31 December 2018, marks the conclusion of a long series of legal proceedings, and will affect the application of the current tax regime to players that earned money by betting on platforms of offshore operators established in the EU.


In this case, an individual living in the Netherlands won approximately €8,500 in online poker games on Rational Gaming Europe Limited (“RGEL”) operates the website RGEL is based in Malta and holds a local licence, granted by the Malta Gaming Authority.  In order to be able to gamble on, users must enter into an end user licence agreement with RGEL. The Dutch tax authorities subsequently imposed a tax on the individual’s winnings, purportedly pursuant to the Dutch Betting and Gaming Tax Act (“BGTA”). The BGTA stipulates that the winnings of Dutch residents that are earned through games of chance, played on platforms operated by offshore betting operators, are subject to taxation. In contrast, winnings earned on platforms owned and operated by Dutch companies are deemed net payments, and hence not subject to tax.

The individual in this case objected to the taxation of his winnings. He claimed that, since the operator of the online games was established in the European Union (i.e. Malta), the levying of the tax would contravene the fundamental principle of freedom to provide services within the EU. The Court of Appeal had previously found in favour of this argument, ruling that taxes may not be imposed on players' winnings to the extent that the games of chance are offered by companies based in the EU. The Supreme Court, however, held that the decisive factor is the origin of the party that is the "organiser" of the games, rather than the party that "offers" such games of chance. Consequently, the Supreme Court annulled the previous ruling by the Court of Appeal, and referred the case back to the Court of Appeal for a new decision.

The individual in question argued that RGEL should be considered the ‘organiser’ of the games offered on The Dutch tax authorities, however, claimed that the ultimate parent company, Rational Group Limited (“RG”), based in the Isle of Man, should be deemed the organiser of the games. This assertion was on the basis that: (i) the main servers and random number generator were based in thsle of Man; (ii) that the main decisions relating to were taken by RG; and (iii) users of the Pokerstars website would often meet in the Isle of Man to compete against each other in real life. As such, according to the tax authorities, RGEL operated predominantly as an intermediary between the players and RG, and should therefore not be deemed the organiser of such games.


In its ruling on 31 December 2018, the Court of Appeal ruled in favour of the individual and found that RGEL was indeed the organiser of the games offered on The Court of Appeal held that it was highly relevant that RGEL operated as an independent entity, and operated the games on its own behalf and at its own risk. The court held that the role of RGEL in offering the games of chance to players was much greater than merely supporting RG. It was also held to be relevant that the individual playing the poker games entered into an agreement with the Malta-based subsidiary, subject to Maltese regulations, pursuant to which RGEL was responsible for the management of the players' funds (among other things). These findings were held to be more relevant than the fact that RG was the ultimate parent company of the group, that the intellectual property in relation to was owned by RG and that the same players that play on the website meet in the Isle of Man to compete against each other in real life.

In light of the above, the Court of Appeal deemed the levying of a tax on winnings earned through platforms operated by EU-based betting operators (where such operator is the “organiser” of the games) such as to be contrary to the EU principle of freedom of services. This is on the basis that no tax would be levied on any winnings earned on platforms where a Dutch operator is the “organiser” of such games. While there is a possibility of a further appeal before the Supreme Court, it is questionable whether such an appeal would overturn the Court of Appeal’s judgment, given that the Court of Appeal has freedom to assess the relevant facts.

In any event, this decision confirms that tax authorities are not permitted under Dutch law to impose taxes on any players’ winnings that are earned through platforms operated by EU-based betting operators.