Transferring a Gaming Licence on a Change of Ownership: Approvals, Timing and Deal Structure

Buyers of gambling businesses often assume the licence comes with the company. In law it usually does, since the licence is held by the company and a share sale does not change the licensee. But every regulator treats a change of ownership as a regulatory event, and the deal can only complete once the regulator is satisfied with the new owners. This guide sets out how licence transfer works in practice and how to structure a transaction around it.

Change of control approval

Licences are granted to a specific company on the basis of its specific owners and management. When those change, regulators require notification or prior approval, depending on the size of the change. Thresholds vary: many regulators require prior consent for acquisitions of 10% or more, with additional triggers at higher levels; some, including Malta and the UK, require approval before the change takes effect; Poland requires notification and, for certain changes, approval of new shareholders under the same vetting standards as the original permit.

Vetting the buyer

The new owners, their beneficial owners and the incoming directors go through the same fit and proper assessment as an original applicant, including source of funds for the purchase price. A buyer with complex ownership, a private equity structure or investors from higher-risk jurisdictions should expect a longer process. Regulators may also reassess the business plan and financial soundness post-acquisition.

Share deal or asset deal

In a share deal, the licensee company is acquired and the licence stays with it, subject to change-of-control approval. In an asset deal, the buyer acquires the business assets and players but not the licence, and must hold or obtain its own licence before taking over operations. Asset deals therefore require a licence in place at completion and, usually, a migration of players with their consent and regulatory sign-off. Share deals are more common for this reason, but bring the seller’s compliance history with them.

Structuring the transaction

Regulatory approval should be a condition precedent to completion, with a long-stop date reflecting realistic regulator timelines. Warranties on compliance, licence status and pending investigations, indemnities for pre-completion breaches, and covenants on conduct of business between signing and completion are standard. Where multiple licences are held, approvals may be needed from each regulator, and sequencing matters.

Timing risk

Change-of-control approvals can take anywhere from weeks to many months. Engaging with regulators before signing, preparing the buyer’s vetting file in parallel with due diligence, and aligning the completion timetable to the slowest regulator reduce the risk of a stranded deal.

After completion

Post-completion, updated key persons, policies and, in some cases, licence documents must be filed, and the regulator will expect the business to operate as described in the approval.

Our corporate and M&A team structures gaming transactions around licensing approvals and manages regulator engagement throughout the deal.