The United Kingdom’s Department for Culture, Media and Sport (DCMS) has announced plans for a major change to its online gambling regulations. Under the new plan, any remote gambling operator that wants to offer its services to customers in the UK, must obtain a license from the UK’s Gambling Commission, regardless of where that operator is located.
Currently, operators need only be licensed in a country in the European Economic Area (EEA). The EEA was formed in 1994, allowing Norway, Iceland, and Liechtenstein to essentially be honorary members of the European Union (EU) – they can participate in the EU’s Internal Market without formally being members of the EU. All told, there are 30 members of the EEA – the 27 EU nations and the three previously mentioned members. In addition to the EEA members, internet gambling companies that are licensed in countries on a separate “white list” are allowed, as well. These countries include Gibraltar, Antigua, Alderney, the Isle of Man, and Tasmania.
Thus, the new plan would shift licensing from the “point of supply” to the “point of consumption.”
In a press release, John Penrose, the Minister for gambling policy and recreation, said:
“The current system for regulating remote gambling doesn’t work. Overseas operators get an unfair advantage over UK based companies, and British consumers who gamble online may have little or no protection depending on where the operator they deal with happens to be based. So our new proposals are an important step to help address concerns about problem gambling and to plug a regulatory gap, ensuring a much more consistent and higher level of protection for those people in the UK who gamble online.
“We will create a level playing field, so all overseas operators will be subject to the same standards and requirements as those based in Britain, as well as being required to inform the Gambling Commission about suspicious betting patterns to help fight illegal activity and corruption in betting.”
While this is not the greatest of news to operators already operating in the UK with licenses from an EEA or White List country, the Gambling Commission isn’t leaving them out to dry. Operators in “trusted jurisdictions” will be treated more favorably than those from elsewhere. For example, they “will not have to duplicate regulatory work.”
Isle of Man Minister for the Department of Economic Development Allan Bell told eGaming Review that he was “encouraged” by the possibility of lighter treatment, saying, “Under the automatic transitional license Isle of Man based companies will have a streamlined point of entry and significantly reduced administrative costs when they obtain a UK license. In my recent conversation with Minister Penrose I received assurances that the UK Gambling Commission has no wish to duplicate the work that our Gambling Commission does in regulating our operators.”
The Alderney Gambling Control Commission, the organization that recently suspended Full Tilt Poker’s license, issued a statement, saying, in part, “…DCMS and the UK Gambling Commission have indicated that they intend to implement a regime of jurisdictional equivalence, permitting Alderney licensees a ‘fast track’ into UK licensing as and when that regime is implemented.
“We have also been assured that the extent of regulatory activity undertaken by the UK Gambling Commission in respect of non-UK operators, including those located in the EEA, will depend on the degree to which those operators meet the standards, enforcement, experience and level of cooperation with the UK Gambling Commission.”
It will still be some time before the proposed changes are put into effect, possibly not until late 2012.
