El Salvador, located on Central America’s Pacific coast, offers favourable conditions for businesses looking to enter the gambling market.
The country regularly issues gambling licences, creating opportunities for local and international operators like casino sites without GamStop. The government promotes foreign investment, making it an attractive option for gambling enterprises.
Licensing Requirements
Obtaining a gambling licence in El Salvador typically takes up to seven weeks. To start a gambling business, an operator must register a Limited Liability Company (LLC), the most common business structure used for such purposes.
Minimum Capital and Costs
- Minimum start-up capital: £1,600 (approximately).
- Registration tax: Approximately £9.
Company Structure Requirements
Establishing a gambling business requires compliance with El Salvador’s corporate regulations. These guidelines ensure stability, transparency, and proper governance of gambling enterprises. Clearly defined responsibilities and structural roles significantly enhance operational efficiency and regulatory compliance.
To start a gambling business, companies must adhere to specific structural requirements:
- At least one director (individual, nationality unrestricted).
- At least two shareholders (individual or corporate, nationality unrestricted).
- A local office must be maintained.
- Appointment of a local administrator for tax representation.
- Appointment of a company secretary.
Taxation
Understanding the taxation framework is crucial for companies planning to operate gambling activities in El Salvador. The comprehensive tax obligations cover corporate earnings, monthly advance payments, and specific taxes applicable to non-resident earnings. This clear taxation structure helps operators plan finances effectively and comply with local laws.
Companies engaged in gambling activities in El Salvador face the following tax obligations:
| Tax Type | Rate |
| Corporate Income Tax | 30% |
| “Pago a Cuenta” (monthly) | 1.75% (advance payment) |
| Value Added Tax (VAT) | 13% |
| Non-Resident Dividend Tax | 5% – 25% |
| Non-Resident Interest Tax | 20% – 25% |
| Non-Resident Royalties Tax | 20% – 25% |
Non-Resident Taxes Breakdown
- Dividends: 5% (standard), 25% (without tax benefits).
- Interest and royalties: 20% (standard), 25% (without tax benefits).
Accounting and Auditing
Reliable financial management and transparent reporting are mandatory for licensed gambling companies in El Salvador. Regular audits and comprehensive financial statements ensure businesses operate legally and maintain high standards of accountability. These requirements also facilitate regulatory oversight and investor confidence.
Licensed gambling companies must meet specific financial reporting requirements:
- External audit (mandatory).
- Annual financial statement submission to the Chamber of Commerce.
- Annual tax audit, depending on company’s revenue.
Company Naming Guidelines
Selecting a suitable company name is an important step in establishing a gambling business. Adhering to clearly outlined naming conventions helps avoid legal complications and ensures the chosen name accurately reflects the company’s structure and operations. Strict adherence to these guidelines facilitates smoother regulatory approval.
Selecting a company name involves following strict rules:
- Name must be in the Latin alphabet.
- Must include “Limited Liability Company” or “LLC.”
- Prohibited from using state or local government agency names.
- Should not mislead about the company’s legal form or activities.
- Must differ from existing registered companies.
- The registrar may reject inappropriate or misleading names.
Application Procedure
The application process for a gambling business licence involves several clearly defined steps designed to streamline regulatory compliance.
Adhering to this procedure ensures that all necessary administrative and regulatory requirements are met promptly, facilitating a smoother launch of operations.
Starting a gambling business in El Salvador involves several steps:
- Reserve company name.
- Obtain taxpayer identification (NIT) and VAT registration (IVA) from the Ministry of Finance.
- Register at the local city hall.
- Register with the Main Department of Statistics and Population Census.
- Register with the Chamber of Commerce.
- Open a local bank account.
Documentation Required
Providing accurate and complete documentation is critical when applying for a gambling licence. Proper documentation ensures a smooth verification process, reducing the risk of delays or rejection. Detailed preparation in advance significantly speeds up the approval procedure.
Applicants must provide several documents to support their gambling licence application:
For Individual Directors and Shareholders
- Notarised passport copy.
- Notarised proof of residence (e.g., utility bill).
- Taxpayer identification card (NIT), if applicable.
- Bank statement.
- Two attorney recommendation letters.
- Signed detailed CV.
- Higher education diploma.
- No criminal record certificate.
For Corporate Shareholders
- Certified company registration certificate.
- Shareholder list.
- Latest financial/annual report.
- Apostilled good-standing certificate.
Government authorities may also request documents proving the income source. All documentation must be in English or translated and notarised.
Advantages of Gambling Licences in El Salvador
Operators benefit significantly from obtaining a gambling licence in El Salvador:
- Low initial capital requirements.
- No specific regulation on online gambling.
- El Salvador is not blacklisted internationally.
- Straightforward and transparent licensing process.
Local Representation
Companies must appoint a local representative who acts on their behalf with tax authorities and governmental institutions. The representative can be either a Salvadoran citizen or a foreigner residing legally in El Salvador.
Their responsibilities include submitting necessary documentation, managing tax filings, representing the company during audits, and ensuring overall compliance with local financial and legal regulations.
The local representative acts as the primary point of contact between the company and local regulatory bodies, significantly streamlining administrative processes and mitigating regulatory risks.
Conclusion
El Salvador presents a promising and accessible environment for establishing gambling operations.
The country’s welcoming attitude towards international businesses, straightforward regulatory framework, and advantageous tax conditions make it an attractive location for gambling companies.
Companies looking to expand into Latin America will find El Salvador a viable and profitable jurisdiction for their gambling activities.
FAQ
How long does it take to obtain a gambling licence in El Salvador?
Obtaining a gambling licence typically takes up to seven weeks.
Are there nationality restrictions for company directors?
No, there are no nationality restrictions for company directors in El Salvador.
What taxes must gambling businesses pay?
Businesses must pay corporate income tax (30%), VAT (13%), and monthly advance payments (1.75%). Additional taxes apply to non-resident dividends, interest, and royalties.
Is online gambling specifically regulated in El Salvador?
No, there is currently no specific regulation for online gambling in El Salvador.
What documents are essential for applying for a gambling licence?
Key documents include notarised passport copies, proof of residence, bank statements, attorney recommendations, detailed CVs, higher education diplomas, and no criminal record certificates.
Must gambling companies appoint local representatives?
Yes, companies must appoint a local representative for tax and regulatory compliance.