Is An Internet Gambling Upheaval Looming in the UK?
The Gambling Licensing and Advertising Bill was passed by the United Kingdom’s House of Lords and became a part of British law after it received Royal Assent on May 14, 2014. The UK gaming law includes stricter underage gambling controls, but perhaps more importantly a 15% point of consumption gaming tax for online gaming operators.
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The Gibraltar Betting and Gaming Association (GBGA) and its more than 20 members have filed a legal challenge claiming that the new regime gives an unfair competitive advantage over foreign operators and does not adequately protect consumers.
Furthermore, GBGA Chief Executive Peter Hewitt explained in an August statement that the only beneficiaries are the “UK domestic industry and the Gambling Commission itself, which has persuaded the UK Government that it should be the global regulator of this high-tech and complex industry.”
PokerNews reported, “William Hill has already launched an age-screening tool on Twitter to prevent underage gamblers from interacting with the brand.” William Hill has stated since the bill received Royal Assent that it will not join the GBGA’s challenge; it is believed that the institution of the company’s new Twitter age screening tool was in preparation of the new gaming law’s enforcement.
Some gaming companies have already pulled out of the UK marketplace ahead of the new law being enforced. Mansion Poker emailed its UK customers in early September letting them know that they will no longer be providing services to the UK as of September 15 and recommended all affected customers to immediately withdraw their funds.
“Due to changing regulations regarding online gaming in the United Kingdom, we must inform you that Mansion Poker is required to close its doors to UK players on September 15, 2014. As a result, we kindly request that you withdraw any and all funds you have in your Mansion Poker account.”
According to iGamingBusiness, Mansion plans to continue in the UK under the new licensing regime with its more lucrative online casino brands including Casino.com, MansionCasino.com, LesAcasino.com, Club777.com, and SlotsHeaven.com.
Sports book giant Pinnacle Sports also plans to leave the UK as of September 30 rather than face the additional 15% point of consumption tax, according to Betting Tools.
In this author’s opinion, it is expected that most of the larger online poker sites will remain in the United Kingdom including PokerStars, Full Tilt, 888 Poker, PartyPoker, Betfair, William Hill, and Titan Poker. Although these sites and others that continue to offer online gaming within the UK will have to face stricter controls and a 15% point of consumption tax, they are all heavily vested in the country with strong player liquidity. Some of these online gaming operators may even find the bill advantageous since competition will be lessened.
If the GBGA challenge proves to be unsuccessful and the new gaming law is enforced, this author believes we will see the dot-fr sites leave the UK including PokerStars.fr and Winamax.fr. While players in the UK, especially professionals, enjoy playing on these sites, it will be difficult for any of these poker rooms to continue due to likelihood of double taxation.
The issue with the French gaming sites is as follows. French gaming regulator ARJELalready heavily taxes licensed online gaming operators. This is the main reason why we see much higher rake on French-based online poker sites compared to the typical worldwide dot-com rake rates. When applying the 15% point of consumption tax called for by the UK gambling bill on top of the taxes already levied by ARJEL, it would be unlikely to be possible for any of these sites to make any profit on its UK customers.
If you are living in the UK, we wouldn’t panic now, as many of the dot-fr sites are known to be reputable. If these sites decide to pull out of the UK, there should be ample time to safely withdraw your funds.
