The Brexit vote of 2016 resulted in the United Kingdom’s official decision to withdraw from the European Union. The referendum ended with 52% of the voting public in favor of leaving the EU, and the process of doing so has already begun with a deadline of March 2019.
With the UK serving as one of the primary markets for online poker in the world, as regulated by the UK Gambling Commission (UKGC), many in the online gaming industry began to worry and wonder what it would all mean for business and customers. The gaming licensing hub of Gibraltar is also in flux as a British Overseas Territory under the responsibility of the UK.
Information from the UKGC
UKGC CEO Sarah Harrison recently attended the ICE festivities in London and provided some information at one of the seminars. She spoke about an “ever changing gambling landscape” but then got more specific. She discussed the development of a three-year corporate strategy for the UKGC and putting customer needs first. This means keeping customers informed as the withdrawal from the EU happens over the next two years.
Harrison noted, “To quote the government, out of the EU doesn’t mean out of Europe. There will still be the need for regulators – whether Europe-based or international – to share information and talk to each other, to share best practice.”
UK Gambling Commission CEO Sarah Harrison: much opportunity for local, natl & intl responsible gaming collaboration pic.twitter.com/kHONsUN7oK— TheIAGA (@TheIAGA) September 8, 2016
Companies with a license issued by the UKGC will likely see little to no change in their overall ability to offer online poker and gaming to UK players, but those with licenses out of Malta or Gibraltar that allow services to EU customers will likely need to apply for a separate license with the UKGC.
At this point, it doesn’t seem as if the UKGC will restrict online poker sites to offer services only to UK customers, as France, Italy, and Spain currently do with specialty sites for those countries. However, negotiations over the next two years will ultimately determine the fate of gambling licenses and their scope going forward. Limiting services to UK players only would be a grand hassle and very complicated, however, so many in the UKGC will likely advise against it.
Gibraltar and Isle of Man Likely to See Biggest Change
With so many online gaming companies based on the island of Gibraltar and the Isle of Man, those companies will face decisions about possible relocations if the tax and overall economic benefits decrease due to Brexit.
As for Gibraltar, it wants to remain in the EU, but under control of the UK, the island nation may not have a choice but to stay with the UK. This could mean the reissuance of numerous licenses that are currently issued for EU operations, and operators may need to reconsider licensing through another nation that will remain in the EU. Malta will be the most appealing option to many of those operators who will want to relocate and renegotiate licenses.
Companies located on the Isle of Man, such as PokerStars, may have to leave depending upon the outcome of the tax negotiations over the next two years. That company has the option of relocating to Canada, where parent company Amaya is located, but leaving its longtime home on the IOM is going to be a difficult decision.
Originally, many expected to have some answers by the beginning of 2017 as to the direction of the UKGC with Brexit in mind. However, it seems that the details of the EU exit are far too complicated and may not be revealed for many months to come.
If the UKGC is to be believed, little will change in the overall operations of online poker and gambling in the UK. But with so much of the gaming world wondering about Gibraltar and the Isle of Man, it is simply a waiting game for many companies with longtime vested interests in the UK market.