Following changes to the Gambling Act to bring 40% of the sector ‘out of the grey sector and into the taxable economy’, Bulgaria has built infrastructure to allow affiliate licensing.
Bulgaria has unveiled a new affiliate licensing framework as it prepares to develop a legal gambling sector.
This comes amid a structural shift for Bulgaria, with new measures looking to address the significant ‘grey sector’ operators, and bring as much as 40% of the industry into the “taxable economy”, the deputy finance minister, Luydmila Petkova, said.
The new affiliate structure is a declaration form, issued by the Gambling Office of the National Revenue Agency (NRA). Relevant companies are encouraged to apply for an affiliate licence – those operating without an active licence could be issued with a blocking order.
Licenses on offer include one-off affiliation activity, under five years, or a five year operations licence. To apply, affiliates must fill in a description of the affiliate’s web pages, social media activity, and mobile app services.
The measures also include two tiers of tax for affiliates, including a €6,000 fixed annual fee, and a 10% variable tax on performance-linked commission, calculated using measurables like deposits and registered accounts.
Affiliates currently generate BGN 450-500m (£219m) in commissions annually, but these are not taxed. The Ministry of Finance expects roughly €100m (£85.6m) in additional taxes for 2026, increasing to €150m in 2027.
Bulgaria introduced the Gambling Act in 2024 – the biggest overhaul in the gambling industry in a decade – which included a ban on gambling related advertising.
Promotions, bonuses, and marketing are incredibly limited, with ads banned from being shown on TV, radio, print and online platforms. Out-of-home (OOH) ads are limited to billboards only and restricted to avoiding “enticing players”.
Amendments in the new restrictions illustrate that any affiliate activities by operators to promote gambling must abide by the new restrictions.
The affiliates looking to operate within Bulgaria must provide an active address of a representative within the country with a right to enter contractual agreements on behalf of the affiliate and represent it before state authorities.
The NRA can also use payment providers and banks to block the transactions of unlicensed affiliates. They can also block the websites, apps, and social media profiles used by any affiliate operators. Once the agency decides the affiliate must be blocked, telecoms providers must cut access within 24 hours of publication.
Advertising companies currently promoting gambling brands on a performance-linked basis must now determine whether existing contracts put them into the affiliate sector. This applies to any entity which received a performance-based commission tied to gambling results, such as a commission based on recruited participants, deposits, bets, and winnings.
