Liechtenstein's casino boom continues: More and more gambling establishments in Europe's Las Vegas have to close
In the late 2010s, it seemed as though the small principality of Liechtenstein was on its way to becoming the "Las Vegas of Europe." However, it has since become apparent that the hoped-for casino boom has not materialized, and an increasing number of gambling establishments are being forced to close. The reasons for this are not only a lack of visitors but also stricter regulations imposed by the Liechtenstein government.
Three Casinos Close in Short Succession
A report from the Neue Zürcher Zeitung reveals that several casinos in Liechtenstein have recently been forced to close. This includes the Plaza Casino in Schaan, which opened at the end of 2022 and is now reportedly closed permanently. The closure was unexpected and made without prior announcement.
The Casino 96 in Balzers has met a similar fate. This gambling establishment is said to have closed down for good in the summer of 2022 after just two years of operation.
At their peak, there were nine casinos in Liechtenstein. Following these closures, there are now only six left. With a population of just under 40,000, the casino density in this small principality is still higher than in Monaco, Macau, or Las Vegas.
Government Preempts Popular Vote with New Regulations
The citizens of Liechtenstein seem to have had mixed feelings about the construction of numerous casinos. Critics have formed the interest group "Stop the Casino Wild Growth."
This interest group initiated a popular vote at the beginning of 2023, in which a general ban on casinos in Liechtenstein was to be decided upon. However, the government preempted the vote by introducing stricter regulations and better player protection before the vote took place.
Citizens seemed to believe that the protests and debates had sparked the new regulations. These include a ban on the licensing of new casinos until 2028 and an increase in the gaming tax. Ultimately, voters rejected a general casino ban in the popular vote.
A Ban Through the Back Door?
Industry representatives sharply criticize the new regulations introduced by the Liechtenstein government. Philipp Nossek, vice-president of the Liechtenstein Casino Association, stated:
One could get the impression that the tightening is being used to introduce a casino ban through the back door.– Philipp Nossek, Vice-President of the Liechtenstein Casino Association, Neue Zürcher Zeitung**
Markus Kaufmann, president of the Casino Association, also points out that Liechtenstein now has stricter regulations than Switzerland. However, he also believes that the government's measures have initiated market regulation. The Casino Association has long assumed that Liechtenstein only needs three to four casinos – more than that is not feasible.
The Liechtenstein government aims to reduce the attractiveness of the casinos with its measures, thereby also reducing their density. A general ban, as demanded by the interest group, is not planned. This decision may have economic reasons.
The gaming taxes of the Liechtenstein casinos generate high sums for the state and municipal coffers each year. Between 2017 and 2023, 117 million Swiss francs (around 120 million euros) flowed into the municipalities and the state. The casinos also employ around 500 people and support various charitable projects.
Market Opening in 2016
In Liechtenstein, a strongly Catholic principality, a complete casino ban was in place for a long time. It was not until late 2016 that this ban was lifted and a licensing regime was introduced. Potential casino operators now have to meet strict licensing criteria to open a casino in Liechtenstein.
After the free market was opened, the first two casinos in Liechtenstein opened in 2017, located in Ruggell and Schaanwald. Within just three years, more casinos opened, resulting in five casinos in the small principality by 2020. The number of casinos then increased to nine in the following years.
Industry experts have recognized market saturation for some time now, leading to many locations becoming unprofitable and closing down. The ban on new licenses until 2028 could help the market regulate itself.
Foreign banned players play in Liechtenstein
The Liechtenstein Casino Association is mainly hoping for guests from abroad. A significant portion of players come from Switzerland and Austria. Critics have previously highlighted not only the danger casinos pose to locals and youth but also to gambling addicts from abroad.
Indeed, Liechtenstein does not currently exchange banned player lists with other countries. This means that players banned in their home country can still participate in gambling in Liechtenstein. The same applies to banned Liechtenstein players who can currently gamble abroad.
The Liechtenstein government seems to have recognized this problem. In October 2022, the government decided to sign an agreement with Switzerland for the exchange of banned player lists. However, this has not yet come into effect as internal procedures are still ongoing.
What's next for Liechtenstein?
The developments of the last years show that the hoped-for casino boom in Liechtenstein has not yet materialized. Three casinos have had to close again. The government has decided not to issue any new casino licenses until 2028 and will then reassess the situation.
Currently, another casino that has already been approved is under construction. It is to be built in the town of Ruggell in an industrial area. The small town with fewer than 2,500 inhabitants is located directly at the border with Switzerland and is expected to attract thousands of visitors to the casinos each month.
It remains to be seen how the gambling market in Liechtenstein will develop in the coming years and whether more casinos will have to close. The year 2028 will be particularly interesting for the principality, as the government will not only decide on new licenses but also on the continuation of the ban on online gambling.
The closure of the Plaza Casino in Schaan and the Casino 96 in Balzers has been heavily discussed, with some suggesting that these closures and the government's stricter regulations might be leading towards a "back door" casino ban in Liechtenstein.
The Neue Zürcher Zeitung report also mentions that there are now only six casinos operating in Liechtenstein, down from nine, due to these closures and the implementation of stricter regulations.
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