Internet gambling firm Betfair warned it was considering legal action against Cyprus after the country banned online casinos and exchange betting.
Betfair made about 4% of its revenues - equivalent to £9m - from Cyprus in the last year.
The Cypriot parliament pushed the measure through on Friday after long delays and heated battles over its content.
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The state is worried it is losing billions in tax revenues to online casinos as well as exchange betting, where punters bet directly with each other using a company as an intermediary.
However, Betfair said the legislation contained "serious flaws and, in certain areas, is inconsistent with European Union law".
"Betfair is working with advisors to understand the potential implications on its business and will be taking all necessary steps to reduce the impact on profitability through both legal action and cost management," the firm said.
OPAP - a company which runs the lottery in the country - was exempted from the legislation, which also contains new taxes on betting shops.
Several arson attacks on OPAP outlets have been blamed on local firms begrudging what is seen as preferential treatment for the company.
There was no suspicion of any involvement from Betfair in such actions.
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