Look around almost any city center and you’ll see betting shops from major companies like Coral, Ladbrokes and William Hill. There’s almost always a Gala Bingo or Mecca Bingo and maybe a Grosvenor Casino so it’s no surprise that gambling is a popular form of entertainment in Britain. These establishments often offer a limited number of electronic gaming machines due to local restrictions. The presentation of a larger selection of games in combination with sheer convenience has boosted the online gambling industry.
Online gambling has not been a restricted practice in the United Kingdom and is 100% legal. The industry is managed by the region’s regulatory body, the UK Gambling Commission, which was established as a result of the Gambling Act 2005. Its intent behind its creation was to regulate gambling in the UK in combination with licensing authorities, one of which is the Isle of Man, in an effort to maintain a crime free, fair and safe environment for players.
Laws governing gambling practices have been in place since the 1960’s and it wasn’t until 2001 that the government decided it was time for some revisions to accommodate the growing online gambling industry. A new bill was presented in 2003, and in 2005 the Gambling Bill was passed into British law, which also brought about the formation of the Commission.
In terms of licensing, operators were permitted to not only market but provide gambling services to UK punters as long as they possessed a license granted from a jurisdiction within the European Union. Those operators offering remote gambling services, meaning they were not located in the UK but accepted UK players, also benefitted from this legislation since they were not subject to UK taxes.
All this changed in 2014 when the Gambling (Licensing and Advertising) Act was introduced.
The Act was to initially take effect in October 2014; however challenges to the law postponed the effective date until November 2014. The new regulations require all operators providing online gambling services to UK punters to not only obtain a UK gambling license but also pay General Betting Duty (GBD), Pool Betting Duty (PBD), and Remote Gaming Duty (RGD) taxes based on ‘place of consumption’.
The changes meant new licensing and application fees in addition to taxation and as a result we saw many operators withdraw from the UK market. UK residents were receiving emails left and right with notifications that their accounts were either being closed or transferred. Operators that applied and were granted UK licensing are sure to receive more traffic than ever before.