How Vanuatu Experimented with Online Gambling, Briefly

Vanuatu was one of the earlier small jurisdictions to see an opportunity in online gambling.

At the turn of the century, internet casinos and sportsbooks were beginning to serve players across borders, while operators needed somewhere to base their companies and obtain licences. For a small Pacific country already involved in offshore financial services, remote gambling offered another way to sell a service internationally without needing a large domestic market.

Vanuatu responded by creating a legal framework for interactive gaming in 2000.

The industry that followed never grew into anything comparable with Malta or Curaçao, and for many years Vanuatu remained a relatively obscure name in online gambling. But the framework did not simply disappear. More than two decades later, the country has returned to the idea with a new licensing model designed to bring Vanuatu back into the international online gaming market.

Vanuatu Entered Online Gambling Early

Vanuatu’s Interactive Gaming Act came into force on 31 May 2000, placing the country among the earlier jurisdictions to create specific legislation for gambling delivered through telecommunications.

The law was broad enough to cover casino games, betting and other forms of interactive gambling. It created licences for operators, set compliance requirements and gave the regulator powers over areas such as approved games, control systems, equipment, audits and investigations.

This was not simply a general business licence being stretched to cover gambling. Vanuatu had created legislation specifically for interactive gaming.

Why Online Gambling Made Sense for Vanuatu

The timing reflected a wider change taking place across offshore services.

Vanuatu had already developed an international financial and corporate-services sector, while the internet was creating businesses that could serve customers globally without needing large physical operations in the country where they were based.

Online gambling fitted that pattern particularly well.

A licensed operator did not need thousands of local players or a large tourism industry. It could operate from Vanuatu while serving customers overseas, allowing the country to earn revenue from licensing and associated business services.

For Vanuatu online casinos, the international market was therefore much more important than the domestic one.

An Offshore Industry Rather Than a Domestic Casino Market

Vanuatu’s interactive gaming framework was primarily useful because gambling had become an exportable digital service.

A traditional casino needs buildings, customers, staff and tourism. An online operator can serve players in other countries through software, payments and telecommunications infrastructure.

That changes the economics for a small jurisdiction.

Instead of trying to create a large local gambling market, the country can sell the legal and regulatory framework that allows international operators to conduct business from there.

This was the same basic opportunity that attracted several smaller jurisdictions to online gambling during the early internet era.

The Industry Stayed Small

Vanuatu created the legal framework, but it never became one of the dominant international gambling jurisdictions.

The sector remained much smaller than the offshore gaming industries that later developed in places such as Malta and Curaçao. It attracted relatively little attention from ordinary players, and Vanuatu never became a major consumer-facing gambling brand in its own right.

That low profile helps explain why its history is sometimes difficult to follow.

The legislation continued to exist and was amended several times after 2000, including amendments in 2002, 2008, 2010, 2013 and 2017. But the country did not build the large regulatory ecosystem, operator base and international reputation associated with the biggest licensing centres.

International Scrutiny Changed the Environment

At the same time, Vanuatu’s wider offshore economy was coming under increasing international scrutiny.

Financial Action Task Force assessments raised concerns about weaknesses in anti-money-laundering controls, supervision, beneficial ownership and other parts of the country’s financial system. In 2015, the Asia/Pacific Group also identified casinos, online gambling and gaming businesses among sectors that could create higher money-laundering risks.

The issue extended well beyond gambling.

Vanuatu had offshore banks, company-service providers, securities businesses and other international financial activities, so pressure was building across the wider system rather than around online casinos alone.

That made regulatory credibility increasingly important.

Online Gambling Became Part of a Bigger Compliance Problem

Remote gambling adds several of the same challenges found elsewhere in offshore finance.

Customers can be located in other countries, money can move across borders and operators may have little physical contact with the people using their services. Regulators therefore need systems for identifying customers, monitoring transactions, understanding company ownership and cooperating with authorities elsewhere.

Those requirements became more demanding as international AML standards tightened.

For a small online gambling sector, that creates an awkward balance. The country may earn licensing revenue from the industry, but it still has to provide enough supervision to satisfy banks, other regulators and international standards bodies.

Vanuatu spent much of the following period strengthening those wider controls.

The Framework Did Not Simply Vanish

This is where the history is often oversimplified.

Vanuatu did not repeal its Interactive Gaming Act and permanently walk away from online gambling. The legislation remained part of the country’s legal framework and continued to be amended.

The government also continued to recognise interactive gaming as a regulated activity.

What happened instead was that Vanuatu remained a small and relatively low-profile gambling jurisdiction while other licensing centres became much more important internationally.

That is different from saying the experiment ended.

Why Vanuatu Never Became Another Malta or Curaçao

Passing a gambling law is only the beginning of building a successful licensing jurisdiction.

Operators also care about banking, payment access, software suppliers, reputation, regulatory certainty and whether licences are recognised by the businesses they need to work with.

Over time, successful gambling jurisdictions develop networks of lawyers, compliance specialists, payment companies, platform suppliers and experienced regulators around the licence itself.

Vanuatu never developed that ecosystem at the same scale.

Its early entry gave it a place in online gambling history, but being early did not automatically make it a major hub.

Compliance Pressure Continued Into the 2010s

Vanuatu’s wider regulatory problems became especially important during the 2010s.

The country was placed under increased FATF monitoring in 2016 after identifying strategic weaknesses in its AML and counter-terrorist financing system. The reforms that followed covered areas such as financial-sector transparency, supervision, international cooperation and the operation of its financial intelligence systems.

By 2018, FATF said Vanuatu had substantially addressed the technical elements of its action plan.

That wider history matters because an offshore gambling licence does not exist separately from the reputation of the jurisdiction issuing it. Banks, operators and other businesses inevitably look at the wider regulatory environment as well.

Vanuatu Returned to Online Gambling in 2024

Rather than disappearing permanently, Vanuatu began a new chapter in July 2024.

The government introduced a new process for interactive gaming licences under the existing Interactive Gaming Act. The Department of Customs and Inland Revenue remains the regulator, while Vanuatu Gaming Authority Limited acts as the exclusive agent promoting and administering applications in partnership with the department.

The aim is explicitly international.

The new licence covers online casino, betting and other gaming activities, and the system is being marketed to operators serving customers outside Vanuatu.

The New Licence Is Still Built Around Offshore Gambling

The basic economic idea therefore looks surprisingly similar to the one Vanuatu pursued more than two decades ago.

The country is not trying to create a huge domestic online casino market. It is selling a regulatory home to gaming businesses that operate internationally.

The 2024 National Risk Assessment describes customers of the licence as operating online and offshore, which makes the international character of the model clear.

In that sense, Vanuatu has returned to the same fundamental opportunity it identified around 2000, but under a much more modern compliance environment.

The New System Is More Formal Than the Old Reputation Suggests

The modern framework places greater emphasis on legal, financial and technical requirements.

Applicants must be registered in Vanuatu and provide information about their ownership and business. The framework also sits alongside Vanuatu’s modern anti-money-laundering legislation, while the Vanuatu Financial Intelligence Unit has responsibility for AML supervision of the sector.

The Interactive Gaming Act itself includes powers covering game approval, control systems, equipment, records, audits, investigations and information requests.

So while Vanuatu still presents itself as a business-friendly jurisdiction, the licence exists within a much more developed compliance environment than the early offshore internet market of 2000.

The Relaunch Also Creates New Regulatory Risks

Vanuatu’s own authorities recognise that the business is not risk-free.

The country’s 2024 National Risk Assessment points to the anonymity of online gaming, cross-border payments, multiple player accounts and the difficulty of verifying customers and sources of funds when players and operators interact remotely.

Those are exactly the problems that have made online gambling regulation more demanding over time.

The opportunity and the regulatory burden therefore arrive together.

A Long Licence Changes the Commitment

The new Vanuatu Interactive Gaming Licence is designed as a long-term product rather than a short trial.

According to Vanuatu’s 2024 National Risk Assessment, licences are valid for 15 years and can cover gambling using both fiat money and cryptocurrencies.

That makes the latest move more significant than simply reopening an old application form.

Vanuatu is again trying to establish itself as a jurisdiction for international online gaming, and this time the intention appears to be to build a more durable licensing product around it.

The Relaunch Was Still at an Early Stage in 2024

The new system should not be confused with an already mature gambling hub.

Vanuatu’s National Risk Assessment recorded that no licences had yet been issued as of October 2024, although applications were believed to have been made.

It also noted that a required code of practice had not yet been completed at that point.

So the relaunch was real, but it was still developing.

Why the History Matters

Vanuatu’s experience shows that online gambling jurisdictions do not simply appear once and then remain unchanged.

The country was an early adopter, creating interactive-gaming legislation when the commercial internet itself was still young. Yet being early did not produce a major global gambling hub, and the sector remained overshadowed by larger licensing jurisdictions while Vanuatu dealt with wider problems around offshore financial regulation.

More than two decades later, the same basic idea has returned.

The technology is more mature, the compliance burden is much heavier and international expectations are far higher, but the economic proposition remains familiar: a small jurisdiction can use regulation as an export service for gambling businesses whose customers live elsewhere.

Vanuatu’s Second Attempt at Becoming an Online Gambling Hub

Vanuatu’s online gambling story is therefore not one of a brief experiment that simply disappeared.

The country created one of the earlier dedicated interactive-gaming laws in 2000 and kept that framework alive while the sector remained small and relatively obscure. At the same time, growing international scrutiny forced Vanuatu to strengthen the wider financial and compliance systems surrounding offshore business.

In 2024, it returned to the market with a new licensing process and a clearer effort to attract international gaming companies.

Whether that second push eventually turns Vanuatu into a meaningful online gambling jurisdiction is still an open question. But historically, the pattern is already clear.

Vanuatu was early to online gambling, failed to turn that early start into a major licensing industry, and is now trying again under a much more demanding regulatory system.