EU online gaming green paper: bad news for Malta?
Yesterday, we discussed the new “green paper” published by EU officials on the topic of implementing cross-border regulations for European online gambling.
That paper aims to “obtain a facts-based picture of the existing situation in the EU online gambling market and of the different national regulatory models,” per the Times of Malta. The period of “consultation” that now begins for new laws on the topic is expected to last until July.
With that in mind, there are some implications in the publication that could mean big changes for the European-facing Internet gambling industry, and the affiliates who promote those brands.
Among those points of interest:
The paper clearly showed that, unsurprisingly, Malta remains Europe’s center of online gambling technology and infrastructure, with more igaming firms than any other EU nation.
With 500 registered online gaming companies in 2008, Malta’s share of revenue from gambling (GGR) was 7.82 per cent of its GDP for 2008. That was 11 times more than the EU average, and it’s possible that other European nations are eyeing that advantage with envy.
The green paper also states that Internet gambling is one of Europe’s most quickly growing industries, “with almost 15,000 websites already identified and total annual revenues exceeding €6 billion in 2008,” per the Times of Malta report.
And the online gambling market for all of the EU is expected to double, and be worth €12 billion by 2013, per the Irish Times.
Bad news for Malta and the UK?
But, according to the Times of Malta, the green paper’s goal of “harmonizing” all online gambling laws — as author Ivan Camilleri puts it — would not be in Malta’s best interests.
“Both Malta and the UK, the two main players in the EU’s gambling industry, prefer a liberal approach where the common EU internal market rules on cross-border services prevail,” Camilleri writes.
As the Malta Independent points out, it’s primarily “Italy, France, Spain, Germany, Denmark and Belgium” that would benefit most from new regulations.
Camilleri adds that the subtext of the report was the unsuitability of Malta as Europe’s online gambling hub — and that new regulations could change that, by mandating fairer taxes towards online gambling companies based in other EU member states.
“Dismissing suggestions that Malta did not have any rules in this sector or turned a blind eye on certain regulations, the Commission official said ‘Malta has managed to attract a big number of online companies due to its favourable tax incentives. However, Malta has a good functioning regulatory system,’” Camilleri adds.
Malta’s Finance Ministry also clarified that the island nation “had 325 valid online gaming licenses held by 220 registered companies in 2008, and not 500 online registered companies” that earlier reports stated, per another Times of Malta article.
Industry reaction begins
It’s a bit early to gauge the complete reaction of the online gambling world, but many European-based companies are embracing the “consultation”.
“A spokesman for Paddy Power said the company welcomed more regulation, as it was generally good for the overall industry,” according to the Irish Independent.
Meanwhile, the Remote Gambling Association (RGA) is also supporting the green paper.
“We hope that the Green Paper, and the evidence submitted in response to it, will provide the basis for an objective assessment of the issues,” Clive Hawkswood, the Chief Executive for the RGA, commented. “The RGA is looking forward to participating in this consultation.
“However, this could be a lengthy process and in the meantime many Member States will be bringing forward gambling legislation at a national level,” Hawkswood notes. “It is vitally important that the European Commission takes all reasonable steps to ensure that those new regimes are fully compliant with EU law.”