Online gaming and gambling is witnessing a regulatory overhaul world over. While some countries like Singapore plans to ban online gaming and enact laws against online gaming by remote companies yet other countries like United Kingdom are working in the direction of allowing such activities.
The Gambling (Licensing and Advertising) Bill of United Kingdom 2013 (PDF) is one such attempt on the part of UK to streamline online and remote gambling in UK. It is accompanied with the Pre Legislative Scrutiny Of The Draft Gambling (Licensing And Advertising) Bill Sixth Report of Session 2012–13 Volume I (PDF) and Pre Legislative Scrutiny Of The Draft Gambling (Licensing And Advertising) Bill Sixth Report of Session 2012–13 Volume II (PDF). UK MPs have debated remaining stages of the Gambling (Licensing and Advertising) Bill 2013- Third Reading Dated 26 November 2013 (PDF).
The Bill was introduced into the House of Commons on 9 May 2013. The Bill makes provision about the licensing and advertising of gambling. Under the Gambling Act 2005 of UK, it became possible, for the first time, to offer “remote gambling” from equipment based in Great Britain. The Act defines remote gambling as gambling where customers participate through the use of “remote communication” such as the Internet, telephone, television, or radio.
The Gambling (Licensing and Advertising) Bill would amend the 2005 Act so that all remote gambling operators would be required to obtain a licence from the Gambling Commission to enable them to transact with British customers and advertise in Britain.
The Bill requires all offshore online gambling operators with customers in the UK to hold licences and pay taxes. Online Casinos has reported that Helen Grant, the U.K’s Culture Minister, commented, “The Bill is a prudential measure which will provide greater protection for consumers based in Great Britain,” she said. “It will tighten current legislation to ensure that all remote gambling, whether provided in Britain or overseas, is a licensed activity subject to the Gambling Commission’s standard and controls.”
As the legislation proceeds to the House of Lords it is very likely the bill will be passed and become law. The law is expected to come into effect by the spring of 2014. . The Minister also said she thinks this legislation will be a benefit to gambling customers in the UK due to a strict new set of guidelines and licensing requirements for online gambling firms from offshore.
According to Poker Update an aspect of the Bill that has gained widespread coverage is the point of consumption tax that would be introduced should the Bill be enacted into law. That tax would be put onto offshore online gaming companies who have UK-based customers who use their product within the UK’s borders.
The current point of consumption tax on Gross Gaming Revenues in the UK stands at 15 percent and would be the tax imposed on companies which are affected by this bill. The tax has attracted criticism from some sections of the online gaming industry, especially from Gibraltar, which is the base of a number of gaming companies due to its low taxes and low business costs.
Such companies and industries may be adversely affected by the bill, especially if it means paying more taxes and other costs associated with being licenced to operate in the UK. While that could end up being the case, the bill does somewhat legitimize online poker and gaming and shows that the UK government recognises that many of its people engage in it.