UK secondary licensing for online gambling latest

The discussions on secondary licensing for offshore online gambling companies wishing to access the British market continued this week with 20 MPs participating in an adjournment debate arranged by member of parliament Matthew Hancock in Westminster Hall.

During the debate an interesting new proposal emerged to bring about more tax revenues for the UK government and levies for the horseracing industry – change the definition of where online gambling takes place from the operator’s server to the point of “consumption” ie the player’s hardware.

Recent precedents for this were reported earlier this year from the North Gauteng High Court in South Africa, which ruled that gambling takes place at the player’s end and not the operator’s servers, defeating a case by Swaziland operator Casino Enterprises .

Hancock, the MP for Newmarket, wants the government to close the tax loopholes enjoyed by offshore bookmakers, reports the Telegraph newspaper.

Under current legislation, bookmakers operating offshore – only Coral and Bet365 of the top 20 bookmakers remain onshore – avoid paying both tax and the horseracing Levy on bets taken by phone or over the internet.

The idea of closing the loopholes has been on the cards for the past two years but the political process now appears to be accelerating with the involvement of HM Treasury and the Department of Culture, Media and Sport.

Hancock wants to include the definition of where online gambling takes place in an annual Finance Bill, although there is a problem with having a regulatory provision like this in such a bill.

“There was a strong consensus for bringing gambling back onshore,” Hancock told the newspaper. “We didn’t get a specific commitment from the minister [John Penrose] in terms of timing, but I wasn’t expecting any.

“It keeps up the pressure and we got across the cross-party agreement on this so the minister can now argue that any legislation won’t be opposed.

“I am confident that it will be done, it’s just a question of when.”

Will Lambe, the British Horseracing Authority’s head of external affairs who attended the debate, told the Telegraph: “There is cross-party consensus in Parliament that racing’s funding needs to be put on a fair, enforceable and sustainable footing. We seek a commercial relationship with the betting industry and MPs from all corners of the country, again led by Matt Hancock, were clear about the wider importance of our sport and that this is an issue which needs sorting once and for all.”