How Will Brexit Impact Online Poker?
The recent shock result of the EU membership referendum in the UK has left many in the gambling industry wondering what the potential impact of Brexit on online poker here. Most critical attention has naturally been entirely focussed on big issues like the economy, immigration and jobs, so poker hasn’t really been a subject that has reached the main political debate yet. Regardless, the controversial referendum vote could have serious impacts for the online poker industry here.
Gambling regulation, gaming taxes and online poker liquidity are all likely to be affected by Brexit. It is highly possible that bookmaking operators may now decide to relocate their business back into the EU. Now that the UK has left the EU, some predict that the influence it had on the nature of European online poker legislation will possibly disappear for good.
When the 2005 Gambling Act was passed in the UK, almost all online operators headquartered here left the country in order to avoid the new gambling taxes. Some exceptions to this exodus included the likes of Bet365 which kept its business headquarters in Stoke-on-Trent, a city in which Bet365 is now the most sizeable private sector employer. Amended UK gambling legislation which was introduced in 2014 aimed to entice back some of those bookmaking operators, but failed. Many have predicted that now Bet365 is outside the EU and EEA, it may well be forced to relocate back inside the EU.
Most EU online gambling regulations specify that license applicants must be members of the EU or the European Economic Area (EEA). This could be problematic for companies headquatered in the UK or in UK territory like the Isle of Man and Gibraltar.
The island of Gibraltar has almost thirty gambling licensees, including British companies like William Hill, which altogether employ around 3,000 people. Commentators have pointed out that a great deal of this workforce live in Spain (an EU nation) and they travel freely across the border to work each and every day, thanks to the EU’s free movement regulation. These companies will probably now be forced to relocate, potentially devastating the Gibraltar’s economic industry.
The editor-in-chief of iGaming Business, Michael Caselli, has stated that, “Brexit will have the greatest and most immediate effect on any Gibraltar based businesses, which will now face great uncertainty.”
“If Gibraltar remains under British control, there will be an issue with Gibraltar staff entering and exiting the border into Spain. If Gibraltar stays in the EU and falls under Spanish control, there may be a very complex issue regarding the iGaming licenses issued in Gibraltar.”
Another serious consequence of Brexit has been the sharp decline in the pound’s value against the US dollar. Many UK online poker players prefer to play using US dollars and now they might find themselves in an awful position for cashing out into sterling. The pound is now at its weakest level in thirty years, a serious downturn, and many online poker players will be continuing to feel the burn from this for the foreseeable future.