New Online Gambling Licensing Rules in UK

July 20, 2011 | News Category: Gaming Law

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There has been much talk and speculation regarding the new online gambling licensing rules that were expected to come out of the United Kingdom. The official new rule regarding licensing for foreign online casino operators has now been announced.

The UK Department of Culture, Media and Sports has listened to the complaints of the online gambling establishments that are based in the United Kingdom, and has come to the same conclusion that these operators have come to. The conclusion being that those online gambling operators that chose to stay in the UK were being taxed unfairly compared to foreign operators.

Some of the larger online gambling companies had recently moved their operations offshore since they were frustrated that they were paying high taxes in the UK, and those companies that joined online gambling jurisdictions that held white papers were simply getting away with paying much less tax, and yet were able to advertise their online gambling sites in the UK and were making revenue from players located in the UK.

The UK government was not pleased at the loss in revenue caused by large online gambling companies leaving their shores, and also acted on the complaints of those that loyally remained in Britain. This brought about the new licensing rule.

The new licensing rule is that foreign online casino and other online gambling operators may still operate in Britain, but will now require a secondary license that they can obtain from the UK Gambling Commission. This new rule will include British taxation on the operators, and it will level the playing field for UK operators.

"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," said John Penrose, the individual who oversees all gambling operations in Britain.

This means that those online gambling companies that moved their operations to online gambling jurisdictions such as the Isle of Man and Alderney will now have to seek licensing inside the UK too. There should not be any issues regarding the eligibility of these operators to continue offering their online gambling sites in the UK, however this formality will simply remove the business advantage that they currently held over their British competitors.

There may also be new licensing fees and a new tax structure for UK online gambling, however, there has been no further information released regarding this issue at this time.