Around 80% of remote (that is, online) gambling in the UK is conducted with operators which are not licensed in the UK, making regulation very complex. In December 2012 the Government published a very short draft Gambling (Licensing and Advertising) Bill to require overseas gambling operators to obtain a Gambling Commission licence in order to provide services or advertise to British-based consumers.
Overseas -based remote gambling operators have generally opposed the Bill. Given the difficulties of regulating a transnational, internet based industry, almost all those who gave evidence to the Committee said that the enforcement regime would have to be rigorous to provide any of the benefits to consumers that the Government intends. In setting a tax rate for remote gambling, the Treasury should bear in mind that too high a rate would be liable to drive customers and companies into the unregulated, black market.
Gambling should be regulated
The Committee supports the principle that gambling should be regulated on a ‘point of consumption’ basis: where the consumer is. It recommends a change to clause 1 of the Bill to make it clearer that the operators affected are those providing remote gambling services to customers in Great Britain. We also suggest that the Government amend the Bill to address the anomaly that it is illegal for casinos to provide online gambling on their premises.
The Government and the Gambling Commission have assured the Committee that the Commission has at its disposal all the tools it needed for effective enforcement; and that the extra income expected from the extension of the licensing regime should produce sufficient funds to pay for the extra work of enforcing that regime, without the need to raise licence fees. The Committee intends to monitor these areas.
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