The gambling landscape in the Netherlands has undergone a dramatic shift in 2025, with the illegal gambling market now generating more revenue than its legal counterpart. This transition has raised significant concerns among regulators who are grappling with the implications of stricter protection rules that appear to be driving players into the black market.
The Kansspelautoriteit (KSA), the Dutch gambling regulator, highlighted this alarming trend in its latest annual report. The data revealed that channelisation—a measure of how much gambling activity is conducted through licensed operators—dipped from 51% at the end of 2024 to just 49% in the first half of 2025. This decline indicates that nearly half of all gambling expenditures are now flowing to unlicensed operators.
In terms of gross gaming revenue (GGR), licensed operators reported earnings of €602 million in the second half of 2025, a figure that remained relatively stagnant compared to previous years. Meanwhile, the illegal sector has surged, with estimates placing its revenue at approximately €617 million during the same period.
Channelisation Slides as Illegal Spend Overtakes
The KSA's findings underscore a troubling trend. While the number of active player accounts reached 1.38 million in the latter half of 2025, the average losses per player decreased, leading to stagnation in overall legal revenue growth. The imposition of stricter player protection measures, including deposit limits of €700 for players over 24 and €300 for younger players, has inadvertently curtailed legal spending. What this means is that while more players are engaging with licensed operators, their actual spending is declining.
Despite the high channelisation rate of approximately 94%—indicating that most gamblers still register with licensed providers—many are choosing to spend their money through illegal channels. The KSA reported a 34% rise in the number of illegal gambling offers, with 2,005 cases noted in 2025. In response to this surge, the KSA has initiated Project Disconnect, a new strategy aimed at disrupting the networks supporting illegal operators.
Statement:
The KSA's chairman, Michel Groothuizen, emphasized that the authority is shifting its approach to combat illegal gambling, focusing on dismantling the infrastructure that enables these operators.
Early outcomes of Project Disconnect include a significant reduction in paid search advertisements for illegal gambling sites on platforms like Google since August 2025, along with the takedown of numerous illegal .nl domains. Major game suppliers have also committed to geoblocking content from unlicensed platforms following discussions at a B2B meeting in late 2025.
The KSA has ramped up its enforcement actions, imposing fines totaling €8.6 million on five licensed operators in 2025 for failing to meet duty-of-care obligations. These fines stemmed from extensive investigations into extreme player losses. Additionally, illegal operators faced penalties amounting to €31.2 million during the same period.
However, the KSA has pointed out a significant limitation in its enforcement capabilities. Current legislation restricts fines to a maximum of 10% of an operator’s global GGR, hindering the regulator's ability to impose proportionate penalties on offshore operators. Discussions are ongoing with the Justice Ministry to amend this legislation.
Financially, the KSA reported a budget deficit of €11.1 million for 2025, partially driven by a €5.3 million shortfall in gambling tax revenues. This shortfall is directly linked to the deposit limits implemented to enhance player safety, highlighting the complex interplay between regulation and market dynamics.
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