Ireland publishes new egaming bill
Sportsbook operators to pay 1% turnover tax if meeting online turnover threshold, while betting exchanges required to apply for separate "remote betting intermediary" licences.
Ireland’s finance department has published a new bill which would require egaming operators taking more than 10% of bets or 200,000 in bets per year to obtain a remote gaming licence.
The Betting (Amendment) Bill 2012 also requires all offshore operators taking remote bets from the Republic to apply for such a licence, while “remote betting intermediary” licences are also to be introduced for betting exchanges.
Successful applicants will pay 1% turnover tax from online sportsbook operations, while betting exchanges will be subject to a 15% gross profits tax on revenues.
Finance minister Michael Noonan has pledged that “This bill will bring into place a fair and equitable licensing and regulatory regime for all bookmakers and betting intermediaries.
“The fact that off-shore bookmakers were not subject to the betting levy represented a competitive disadvantage to on-shore firms and also narrowed the State’s yield from the levy,” added Noonan.
The move follows pressure from a number of operators, with Ladbrokes warning in January that delays in bringing forward a regulatory framework could put hundreds of jobs in jeopardy.
David Jennings, analyst with Davy Research, put out a note this morning in relation to the new bill, in which he explains that “This bill was seen as a necessary step ahead of taxation of online and telephone gaming operators.”
However he notes that “The concern of operators intending to operate within the regulatory framework is that in other countries that have introduced similar systems, rogue offshore websites have continued to offer gaming services while avoiding the payment of tax, creating an uneven competitive playing field.
“A critical issue for operators is enforcement of the new regulatory regime and to this end, the new bill appears to give the state sufficient powers to block unregulated offshore operators,” notes Jennings, citing “The ability to order credit institutions not to transact with a particular business, the ability to prevent offshore operators advertising within the state (including their ability to sponsor a sporting event) and importantly, the ability to block particular websites in cases where the operation is unlicensed.
Other newly regulated markets have implemented such measures with mixed success, with Belgium’s introduction of a blacklist and blocks on unlicensed sites leading to legal disputes with bwin.party and bet-at-home. The former has been resolved in favour of the Belgian Gaming Commission while the latter dispute is ongoing.