UK Gambling Act To Shake Up Global iGambling Market

On October 1st the UK’s Gambling Act is expected to come into force, complete with its ‘point of consumption’ regulatory framework requiring all online gambling companies wishing to offer their websites in the UK to first obtain a remote gambling licence from the country’s Gambling Commission.
In the past, major gambling operators have obtained licences from such regulatory jurisdiction as the Isle of Man, Alderney, Gibraltar or Malta, but now the UK Gambling Commission is set to become an important global iGaming regulator. The move is also likely shake up many offshore regulatory jurisdiction, as many major UK gambling operators, such as William Hill, Ladbrokes, Victor Chandler, Bwin.Party, and BetFair, are based in locations such as Gibraltar.
However, in order to qualify for a remote gambling licence the online gambling operator must ensure not more than 3% of its revenues are derived from grey markets, whilst also providing legal rationale for their presence in such markets in the first place. As Richard Richardson explains in his article on onlinepokerreport:
“It could be difficult to find a legal rationale for some popular markets (Australia, Russia and South Africa come to mind). There may be some legal wiggle room for other significant markets that lack a clear regulatory scheme for online gambling (think Canada, Germany and even Sweden, Finland or others in the EU).”
This could potentially represent a game changer for the global iGaming market, as many major gambling firms will now have to exit grey markets if they are to granted access to the UK. Their decision to do so will likely be a straightforward one, too, as the UK accounts for 8% of the online gambling market, last year having generated £2.5 billion ($4.26bn) in revenues, including £329 million ($559m) from internet poker.
Furthermore, The Gambling Act could act as a potential model for other European online gambling markets. Unlike other large European iGaming countries such as France, Spain, Italy, and Belgium, for example, the UK has not insisted on ring fenced poker player pools and so has managed to maintain a lucrative, vibrant industry which it then successfully manages to tax. Needless to say adopting a similar approach could help boost the flagging online poker industries of all of these other markets.