Unibet operator Kindred has halted its operations in the Netherlands as it launches its gambling business in the country today (1 October), which it says could generate £144m in annual revenues.
The operator is awaiting clarification from the Dutch authorities on the licence application, which it expects in the coming days.
Kindred chief executive Henrik Tjarnström said the operator believed it did not need to block customers from the Netherlands if it was not targeting them, but said Kindred would not accept Dutch customers until it received clarification. This could happen in the next few days, he said.
"As far as we are concerned, international operators are not obliged to block Dutch players," he said.
He said that Kindred believes that it has met all the necessary licensing criteria to enter the Dutch market, including the maintenance of the cooling off period required for all licensees who have previously targeted Dutch customers without a licence.
During the said cooling off period operators are not allowed to be active in the Dutch market, including those that offer the so-called Online Casino Einzahlungsbonus, a casino with an entry fee without a deposit. While Sorodic believes he has followed these rules - although he paid what Tjernström called a "voluntary fine" for unlicensed Dutch operations in 2019 - he said circumstances have changed now that the licensed market is up and running, and so he will not accept Dutch customers until they are certain of their legal position.
The operator will apply for a licence shortly after November 1, when the reflection period has passed.
Tiernström said: "We have taken steps to temporarily cease our operations due to changes that have led to uncertainty in the market. We have not been actively targeting the Dutch market - the 2019 fine was made voluntarily. The letter the minister sent on 20 September clearly states that there should be no link between the passive presence of Dutch customers and the licensing process.
"Part of the legislative change was that it was OK for operators who were not targeting Dutch customers to get a licence and operate in the Dutch market. We meet the criteria; no .nl web address, no Dutch marketing, no Dutch payment solutions. As a consequence, we are not actively targeting Dutch customers".
Kindred estimates that the decision to cease operations in the Netherlands will cost the company £12 million a month in earnings before interest, tax, depreciation and amortisation (EBITDA) before any possible mitigation actions. Kindred's base EBITDA for 2020 was £118.0 million, or an average of £9.8 million per month.
Tiernström continued that the company had not yet applied for a licence due to waiting for a reflection period. Players in the Netherlands with an active account on Kindred sites will not be able to bet, but can still withdraw money from their accounts.
Tjarnström added: "Our licence application has been a long time in the making and we have passed all the necessary audits. We are also working to ensure that our systems are fully compliant and ready to go live as soon as possible, but we also have time to think about it.
"We are ready with some aspects of the application and plan to have most of them ready by November 1. We want to complete the process we have been going through for a year and a half."
Kindred's chief executive added that when it eventually relaunches in the Netherlands, he could not be sure what the market returns would look like, but said a similar experience in France had made him optimistic.
Sorodic's decision to cease operations follows Betsson and LeoVegas, which are taking similar action. British operator Entain has also suspended operations in the Netherlands in search of a gaming licence in the country.
888 Holdings also announced today that it is blocking Dutch players.
"The Netherlands has accounted for approximately 3% of the Group's total revenue in recent periods and the impact of this change on 888's results in 2021 will not be significant," the statement said.
Dutch regulator Kansspelautoriteit (KSA) has identified ten operators with a Dutch gaming licence by the time it enters the market.