Gibraltar triggers financial services-inspired gambling act reform process

The Gibraltar government has published the first draft of a bill aimed at reforming and replacing the 2005 Gibraltar Gambling Act to a more financial services-style regulatory framework.

Broadly speaking, the draft bill aims to introduce more flexibility on licensing in areas including the location of operator equipment and servers.

It also looks to extend licensing and extend the categories of licenses, and to introduce formal processes, and greater transparency and accountability of decision-making by the licensing authority and the regulator.

“The bill seeks to preserve and enshrine Gibraltar’s supportive and understanding approach to the proper and reasonable needs of the online gambling industry, while better equipping the licensing authority and the regulator to be responsive both to the changed and changing needs of the industry and also to Gibraltar’s regulatory objectives,” the draft bill states.

In addition to the increased flexibility surrounding licensing, the bill introduces a right of appeal to a soon to be set up Gambling Appeals Tribunal, which serves to facilitate examination of rulings against operators, suppliers and other individuals working in the sector.

It also introduces an “approved persons” regime requiring persons carrying out certain functions within a gambling-related business to be approved by the regulator, as well as introducing a regulatory regime in relation to changes in shareholder control of a licensed gambling operator.

The draft legislation also provides for an “appropriate” range of modern regulatory, investigatory and enforcement powers for the division.

“These are designed and intended to ensure that the licensing authority or the regulator (as the case may be) has the necessary options to ensure an appropriate and timely, but fair and proportionate response to regulatory and licensing contraventions,” the draft bill states.

Central to the draft bill’s design is text drawn from and replicated from the Gibraltar Financial Services Act 2019.  The bills design follows a March 2016 review of Gibraltar’s online gambling sector, including the legislative, licensing and regulatory regimes and assessing related issues, which itself has been the subject of consultation over the intervening years.

The Gibraltar government has said the intent behind this move is to facilitate the emergence of a “Gibraltar style and approach” to licensing and regulation of regulated industries, as well as creating understanding and consistency.

The draft legislation has been released for stakeholder consultation until the end of August 2022, with the Gibraltar Gambling Division holding workshops and consulting with Gibraltar’s main trade body for operators, the Gibraltar Betting and Gaming Association.

The Gibraltar Gambling Division has committed to issuing a new licensing framework and fees document, together with codes of practice, including a social responsibility code for consultation later this year.