Lichtenstein is a tiny Alpine principality with an interesting claim to fame – it launched the world’s first ever online lottery. Since 1995, Europe’s 4th smallest country hosted lottery draws that players around the world could take part in. It revolutionised lotteries and gave players the chance to win jackpots worth millions, whilst also generating funds for charity. On this page, you will find an interesting overview of the Principality of Liechtenstein and how it redefined the way we play the lottery today.
An Overview of Lichtenstein
Let us start our guide to lottery in Lichtenstein with a closer look at the country itself. In fact, Liechtenstein is not a country, but a principality. Nestled between Austria and Switzerland in Alpine Central Europe, it is the 6th smallest country in the world. The microstate is one of only two doubly landlocked nations round the world.
Liechtenstein is not part of the European Union. It is part of the Schengen Area and the European Economic Area, meaning it has open borders, visa policies and free trade agreements with EU countries. It is made up of 11 municipalities, the largest of which being Schaan. Liechtenstein is a constitutional monarchy, which is headed by the Prince of Liechtenstein. He is one of the world’s wealthiest monarchs.
The population of Liechtenstein is around 38,000, with more people employed in the country than residents. There are almost 20,000 workers that commute to Liechtenstein. Around a third of the population are foreign nationals, mostly from Germany and neighbouring countries Switzerland and Austria. Fewer than 60 residency permits are issued each year for EEA citizens that are employed in the Principality. Half of the permits are awarded by the government; the other half are determined by a lottery.
Economically, Liechtenstein ranks among the highest GDP per capita states in the world. The microstate has attracted many European companies that have based in the country to take advantage of its low taxes. Liechtenstein has a monetary union and a customs union with Switzerland and the Swiss Franc has been the legal currency since 1920.
InterLotto – The First Nationally Sanctioned Lottery on the Internet
Liechtenstein are the pioneers of the online lottery industry. In 1995, internet gambling was in its infancy. A British-based software company developed the idea of an online lottery venture. Two former South African stockbrokers, Alan Tucker and David Vanrenen were the brains behind the project. Operating from the offices of Micro Media Services Ltd in London, the entrepreneurs secured a licence from the Liechtenstein government to provide their internet based international lottery games.
The International Lottery in Liechtenstein Foundation (ILLF) was created to operate this lottery. The ILLF was a charitable organisation, that was state-controlled and authorised by the government. They successfully launched the first online lottery, InterLotto, and processed the first ever online gambling transaction.
The ILLF had a key focus on charities. They secured a proportion of all profits generated from the international lottery which would be used to fund causes not only in Liechtenstein but other countries around the world too. The distribution of the charity funds was made by the Charity Allocation Committee, a government-controlled group.
Owing to the lower operating costs of running an internet lottery, InterLotto was able to offer 65% of total takings as prize money. At the time, the next highest paying lottery had a prize fund of around 55% of takings. Around 5% of revenue was allocated for charity, with around 30% used to cover operating costs.
The first international lottery game operated by the ILLF was called InterLotto. The first ticket for the game was bought by the then prime minister, Mario Frick. The first draw took place on Saturday 7th October 1995, in the capital city of Vaduz. Lotto executives predicted a massive interest in the internet international lottery and forecasted that a million players per week would take part in the lottery by the end of the year, almost 33x more players than the population of Liechtenstein.
However, by 1997, InterLotto was only attracting around 100,000 players per week worldwide, 7000 of which from the UK, despite a ban on advertising foreign lotteries in the UK. These figures fell far short of the expectations of lottery executives. In the two years the lottery had been in operation, it had never paid out a full jackpot. Organisers blamed the lower than predicted internet sales for this fact.
Following the disappointing sales, InterLotto was rebranded and relaunched as PLUS Lotto from April 1997. An endorsement deal was put in place with The International Federation of Red Cross and Crescent Societies. Execs hoped that the backing from the world-renowned charity would build trust and confidence in the international lottery brand and boost sales worldwide.
The endorsement deal would see The Red Cross awarded with 25% of lottery takings. The 5% charity contribution to Liechtenstein continued to remain in place. Operating costs were reduced, yet the biggest impact of the Red Cross’s cut was reflected in the lottery prize fund. Whilst a key selling point of InterLotto was the 65% prize pool, following the rebranding, the overall prize payout of the game dropped to 50%.
Through the rebrand, lottery organisers were aiming to attract 200,000 UK players per week within 18 months. These figures again accounted for the UK advertising ban. They also hoped to attract up to 10% of internet users in key markets.
Despite the rebranding of the International Lottery and the predicted boost in player numbers, the future of the game was not secured. In September 2011, the ILLF filed for bankruptcy, ending all international internet lottery services operating in Liechtenstein.
Lottery and Other Games on the ILLF Network
InterLotto may have been the first nationally sanctioned internet lottery, yet the International Lottery in Liechtenstein Foundation operated numerous lotto websites. Some of the sites operated by the ILLF included World Lotto Corporation, Lotto.li, and PLUS lotto. These websites were collectively known as the ILLF brands, and they offered a diverse range of games, including:
- Lotteries
- Instant win games
- Scratchcards
The main weekly lottery draw operated by the ILLF was a 6/49 game and it took place on a Friday night. Known as the Euroworld Lotto, in the game, 6 numbers and a bonus ball were drawn from a set of balls that were numbered from 1 – 49. Players chose 6 numbers and a bonus number and prizes were awarded for matching 2, 3, 4, 5 or 6 numbers. Prizes were also awarded for 5 numbers plus the bonus ball and for 6 numbers and the bonus ball. The total prize fund for the game was 90% of the value of the ticket price. Payouts were made as follows:
- 2 numbers – €5
- 3 numbers – €30
- 4 numbers – €120
- 5 numbers – Pro-rata share of the remainder of the prize pool
- 5 numbers and bonus ball – Pro-rate share of the remainder of the prize pool
- 6 numbers – €2m
- 6 numbers and bonus ball – €20m
The odds of winning the smallest prize were 1 in 7, ranging as high as 601,304,088 in 1 for matching all 6 numbers and the bonus ball. Overall, the odds of winning any prize in the lottery draw were 1 in 6.63.
The weekly draws were conducted from the ILLF studio based in Liechtenstein. All the procedures surrounding the game draw were supervised by an independent auditor. The auditor would check the loading of the balls into the machine prior to the draw and remain on screen supervising the entire draw process to its completion.
Another popular weekly Liechtenstein lottery was the Little Big One. Unlike the 6/49 game, the balls were not loaded into a machine and drawn. Instead, it was an automated draw, using a random number generator to determine the winning numbers. There was a maximum of just 3003 tickets available for each weekly game. Tickets contained 5 numbers chosen from 15.
During the draw, 5 balls would be drawn from 15. There were 3 prize categories, which could be won for matching zero balls, 3 balls or 5 balls. With each of the 3003 tickets containing a unique combination of numbers, winners did not share the prizes. The overall odds of winning any prize were 1 in 4.27. Here is the breakdown of the prizes for the game:
- 0 of 15 numbers – €6
- 3 of 15 numbers – €8
- 5 of 15 numbers – €3003
There was also a monthly Liechtenstein lottery game, called the Equinox Lottery. Draws would take place on the same date as the Equinox, usually between 20-22nd of the month. It was a raffle-style draw and the total prize pool totalled up to €45,000. Only 2000 ticket numbers were available in each draw, with each ticket containing the option to buy between 1 and 3 shares at €15, with a complete ticket costing €45. Up to 565 cash prizes were available for each draw, with odds of 1 in 3.54 to win a prize. The odds of making a profit were 1 in 5.45.
PLUS Lotto offered a range of alternative games to lottery that could be played online. Their selection of instant win games gave players the chance to win up to €10,000 in an instant. They also offered a choice of online scratchcards. The scratchcards could be bought for between €1 – €7 and offered prizes of up to €100,000.
Gambling Laws in Lichtenstein – Is Lottery Legal?
Liechtenstein has a licensed and regulated gambling market. The Gambling Act of 2010 regulates lotteries, as well as casinos, games of skill, and online games. The government has the authority to grant or refuse a licencing application. The Office of Economic Affairs is responsible for regulating gambling within the framework of the gambling laws.
The Gambling Act provides for two types of lottery organisers. There are large organisers who generate stakes of 100,000 Swiss francs per year. There are also small organisers, which are further divided into 3 subcategories. The Gambling Act lists the rate of duty for lottery operators. For large operators, gross gaming revenues are subject to a 20% tax, with smaller operators charged 10% tax. Despite the legal, licenced and heavily regulated gambling landscape, there are no large lottery providers currently in operation in Liechtenstein.
How to Play Lotto in Liechtenstein
Since the ILLF filed for bankruptcy, there has been no international lottery based in Liechtenstein. Yet that is not to say that Liechtensteiners cannot play the lottery. Many pop over the border to participate in the lottery in Switzerland. Organised by Swisslos, there are various draws and games available.
You can also play EuroMillions in Switzerland. However, given that winnings of over CHF1 million are taxed at 35% when playing in Switzerland, smart players have turned to online lottery sites to participate in the European lottery.
Whilst Liechtenstein no longer operates an online lottery, there are many other operators that have continued to embrace the online lottery movement pioneered by the ILLF. The biggest possible jackpot in Liechtenstein lottery was €20 million. Nowadays, that amount is overshadowed by the jackpots you can play for online in international lotteries.
The American lottery game, Mega Millions is drawn twice a week. It is renowned for its huge jackpots, with the largest Mega Millions jackpot ever paid being $1.57 billion. Powerball is another top American lotto game, which holds the record for the highest ever lottery payout of $1.59 billion. The Euro Jackpot is drawn in Helsinki, with a jackpot that starts at €10 million and can roll over up to 9 times. These games can be played all over the world thanks to online lottery operators.
Liechtenstein Lottery Legacy Continues
The international online lottery industry is booming nowadays. Yet the story of the industry’s origins is little known to many. Liechtenstein may be small, but it led the way in online lottery. A forward-thinking concept, coupled with the legal framework to execute the project gave birth to a new way of playing the lottery. Liechtenstein continues to boast a well-regulated, legal gambling industry. And while the Liechtenstein lottery may no longer exist, its legacy continues.