UK to tax online offshore operators through secondary licensing

10.01.2010, UK.- Overseas online gambling firms that target British punters will require a licence under proposals outlined by the Department for Culture, Media and Sport (DCMS). The announcement came as Sports Minister Gerry Sutcliffe admitted that few of the main operators targeting British gamblers were regulated by the Gambling Commission, casting doubt over moves to improve consumer protection.

The new plans, which will be subject to a consultation period, would mean that online operators licensed outside Britain would have to apply for a licence from the Gambling Commission if they wanted to advertise or provide gambling services to UK punters.

Under the plans, all online gambling firms active in the British market will have an obligation to share information about suspicious betting patterns with the UK sports governing bodies as well as the Gambling Commission. They will also have to comply with British licence requirements in areas such as the protection of children and vulnerable people, and will have to demonstrate how they will contribute to the research, education and treatment of problem gambling in Britain.

The Government is considering what the plans mean for operators based in countries outside Europe, specifically in terms of the Government’s approved “whitelist” of countries whose operators are able to advertise in the UK, companies in the European Economic Area member states, including Gibraltar, and companies run from so-called white- list jurisdictions, approved areas such as Antigua, the Isle of Man and Alderney. Proposals for any changes to the system will be included in the consultation.

The proposals follow the launch last April by DCMS of a review of online gambling regulation in Great Britain, focusing on consumer protection and ways to ensure that overseas operators contribute towards regulation, problem gambling treatment and the Horserace Betting Levy.

Sutcliffe said that the Government was still investigating ways of securing levy contributions from overseas operators, an area brought into focus by the recent move offshore by Ladbrokes and William Hill, and it was still his intention that all operators taking bets on British races pay to support racing in the UK.

Sutcliffe said: “Online gambling has changed significantly in recent years with many European countries taking new approaches to regulation. It would be wrong of us to stand still where things are changing around us - especially where the protection of British consumers may be at stake.”

“The new system outlined today will also ensure that all businesses offering online gambling to our consumers adhere to our rules and not someone elses. The Gambling Act is already one of the best regulatory frameworks in the world and these changes will ensure that it sets the standard for all online gambling companies that target British consumers.

The DCMS review did not deal with the thorny area of tax, the main reason why some British operators have moved offshore.

Yogonet.com / Times Online

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