Online Gambling And Brexit: What Impact Will The Leave Vote Have On The Industry?

Posted on July 18, 2016 - Last Updated on March 1, 2019

[toc]The British electorate’s decision to leave the European Union has prompted speculation in all industries, not least online gambling.

The United Kingdom hosts six regulatory bodies for online gambling, including the Gibraltar Regulatory Authority in the overseas territory of Gibraltar. The tiny nation on the Iberian peninsula voted overwhelmingly to remain part of the EU and is home to online gaming companies such as William Hill, bwin.Party and 888.

Other major regulators include the UK Gambling Commission, the Alderney Gambling Control Commission and the Isle of Man’s Gambling Supervision Commission.

Brexit and The Rock

Both the Gibraltar Minister for Gaming, Albert Isola, and the Gibraltar Betting and Gaming Association (GBGA), said that it would be business as usual.

“At the moment and for the foreseeable future there is no change to the existing legal and political framework that our operators work within,” said the GBGA. “European countries already have widely different regulatory regimes and many require our operators to have local licenses, the impact on our members is therefore likely to be minimal.”

As well as regulatory concerns, the many online gambling companies that hold offices in Gibraltar could be affected by a lack of freedom of movement, as many of their employees live in neighboring Spain and cross the border to work in Gibraltar each day.

A move to Malta?

The Isle of Man is a crown dependency of the United Kingdom and is home to PokerStars, who hold gaming licenses all across the globe. One such license is in Malta, which remains part of the EU and has a similar low corporate tax rate to Gibraltar and the Isle of Man.

If the British government do choose to invoke Article 50 and leave the EU, many companies currently in Gibraltar and the Isle of Man may well look to Malta to retain their access to the European Economic Area and low taxation.

Current UK gambling regulation

The United Kingdom has a long relationship with gambling. Indeed, the U.K. boasts one of the highest numbers of bookmakers per capita in the world.

The UKGC grants licenses to operators, who must pay a 15 percent Point of Consumption tax. Prior to 2014, only operators based in the U.K. were liable to taxation – this is why many operators are based in areas like the Isle of Man or Gibraltar.

UK regulation vs EU regulation

While the U.K. is a regulated gambling market, most of the world’s online casinos are available to U.K. customers, who can bet and play alongside others from around the world.

Many EU countries, such as France, Spain and Italy, do not permit players outside these countries to access their “ringfenced” sites and levy a higher rate of taxation.

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Matt Perry

A veteran of the online gambling industry, Matt Perry has worn a number of hats since he first began working in online poker and iGaming in 2007. He currently writes for a variety of publications focused on legal online gambling, and in the past has served as an editor, copywriter, content manager and reporter.

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