Can someone please explain the new UK gambling law in dummy format.

[Puma]

Can someone please explain the new UK gambling law in dummy format.

I have read numerous articles and news reports but it still seems very unclear as to what the actual reason for some big names to be closing shop.

Thanks

[Casino Online Rating]

I have read numerous articles and news reports but it still seems very unclear as to what the actual reason for some big names to be closing shop.

Taxes.
Most of these companies are licensed in places like Gibraltar because of favorable tax conditions and getting a British license would mean they would need to pay a 15% (if my info is up to date) tax on gross gaming revenue. Seems some of them decided it's not worth it?

[Puma]

That's a perfect explanation thank you. So It would be fair to summarize pages upon pages of legal mumble jumble and simply say the UK treasury wants 15% of the profits.

[universal4]

NO, they want 15% of the gross, which means the potential to lose money on large winners increases and the potential to lose money on small losers also goes up.

Rick
Universal4

[F-L-C]

so the casinos with a big uk player base chose to get a license, those that don't didn't and most of the microgaming brands saw it as an opportunity to screw over affiliates

[TheGooner]

Previously, having a license in a white list jurisdiction (Malta, Gibraltar, Isle of Man, mainland Europe) meant that you did not need a specific UK license in order to accept UK players. This has changed and a UK license is also required.

I don't see big names closing shop in the UK - but the smaller outfits are. Some of these small outfits have always felt like they are run by a handful of people - and the annual licensing cost may be a big shock to these small outfits.

The costs of licenses vary depending on the turnover of the company applying, but initial costs of £19,500 ($31,700) and an annual fee of £118,000 ($191,800) are mentioned in the gambling act’s small print.

Additionally on Dec 1st a 15% tax on gross profits on UK bets - for remote gambling outfits that accept UK customer.

In addition to the cost of the license, a new point of consumption tax comes into force on Dec. 1, 2014 that sees overseas operators have to pay a 15 percent tax on all bets stemming from customers based in the UK.

While 15% is not a huge tax, most businesses are subject to a lot higher taxes, (we pay 28% in New Zealand) but many gambling companies have moved their bases offshore to favourable countries with specific low taxes :
- Curacao 2%,
- Malta 0.5% of gross + EUR 7,0000 license,
- Gibraltar 1% gambling tax and 10% corporate tax,
- Isle of Man 0% corporate tax(!).

So this new tax regime is a significant increase in cost to companies that relocated to avoid tax - but hardly draconian.

Sources :
http://www.pokernews.com/news/2014/0...elay-19375.htm
http://calvinayre.com/2014/07/22/bus...will-stay-put/

Oh and Bet365 affiliate can breath easy - nothing will change there as Bet365 is already registered and based in the UK and pays full UK taxes of 21% and is not subject to any of this remote gambling tax setup.

[Puma]

Thanks Gooner, much appreciate the extra information.

[RacingJim]

The fact that Bet365 have made their business work AND remained in the UK for sports betting stuff is remarkable really in the face of the competition having that advantage over them for so long.

Also I'm moving to the Isle of Man. Haha.

[GCG]

Guess Buffalopartners is a very small outfit.
Gnuf said.

[alexpratt]

Hi Guys - This is a round table piece from the latest issue (in post this week and at BAC) on this - Intro is:

As well as hitting affiliates’ pockets, the UK’s new point of consumption (PoC) regulatory and tax regimewill make it a criminal offence for them to advertise non British-licensed operators to British players from1 November. iGB Affiliate spoke to Steve Day from Click Profits, Phil Fraser from WhichBingo.co.uk,Iain Coward from Freebets.com and Marcel Puyk from Bet2Go.com ahead of its implementation to findout how they are preparing their sites and businesses.

https://www.hightail.com/download/Ul...eDNIcWYwZXNUQw

We also have a session on this at BAC which I will record and organise to be uploaded to the BAC site

[Notspot]

Good article on the implications for affiliates..

http://www.peterwilsonlegal.com/the-...on-affiliates/

What the 2014 Act will mean for affiliates is that they would commit a criminal offence if they advertise a non-British licensed gambling operator to persons in Britain.

[Chips]

Good article on the implications for affiliates..

http://www.peterwilsonlegal.com/the-...on-affiliates/

Very good article. Thanks for sharing.

So, does this affect only UK based affiliates, as far as the offences? We are incorporated in NC and of course pay our alms to the state and fed gov't. Do we need to restrict pages of non-UK licensed brands to UK visitors?

[Sherlock]

What the 2014 Act will mean for affiliates is that they would commit a criminal offence if they advertise a non-British licensed gambling operator to persons in Britain.

It is quite sad to see Britain, who was few years ago the biggest advocate of free international gambling, to act this way. But it is logical, because the battle for free market was lost with deterioration of EU.

Still this law does not apply to nonUK citizens at least de facto. There are countries that forbid anal and extramartial sex and I really do not think about them during the very rare occasions I enjoy both at once.

[mojo]

Good thread and helpful to know.

Plus I can't stop laughing.

[TheGooner]

Technically, the law applies to any website that offers gambling advertising to UK customers, but the reality of enforcement means that only UK websites with UK contacts would be likely to be prosecuted.

However, I can think of three other situations that MIGHT occur if the UK authorities were zealous about enforcement and you had a website at was successful enough to attract attention :

1/ They might approach UK license holders that were on your site and suggest that the appearance of their product on your unregulated and illegal site is a breach of their license ... I would expect the license holder would react.

2/ They might approach an offshore webhost and state that your website was illegally targeting UK customers with unregulated products ... and ask for it to be suspended / taken down by your web host. I think 99% of webhosts would react to a UK government request.

3/ They send you a nasty email to your website saying you are not compliant. You might ignore it. I wouldn't.

I know that if any of these happened to our sites, I would be annoyed / angry and have to react as the UK market is a lucrative one and around 15% of our audience. So we have been proactive and have used georouting tests to display appropriate advertising to the correct countries.

I believe that none of the situations I suggested seems very likely, most gambling authorities in the UK seem to sit back and simply collect the money, but this new regime will bring in significant funds and so there MIGHT be a more active policing role.

[Sherlock]

I do not see a problem with 2/ or 3/. If 2/ happens I would move to another hosting and tell them to **** off (partly here is a problem that in theory if someone wants to promote illegals in the UK he really should not have UK hosting which is few negative SERP points).

I am already getting many nasty emails, so 3/ is no problem.

Point 1/ might be a problem if they would be inspired by their elder brother USA, because it would be the "bad actor" rule and I think it is possible. But there is a big difference between US and UK (at least for sportsbetting, not sure about casinos). In the UK all the big brands that convert will have UK licenses, so affiliates will naturally support them.

I have no intention to promote BwinParty or WillHill or other unknown brands in the USA. I would even think twice about Bet365 (who were if I recall correctly doing fairly good at US market before 2006).

So I think it is something that will not be implemented - not until BTC gambling will raise to masses (if ever). Or correct me please: are there some big gambling UK brands that will continue to operate in the UK after November without licence? Even Pinnacle gave up.