Regulation round-up 19 January 2016
The biggest regulatory news from the egaming industry in the last seven days (13 January to 19 January 2016)
Operators baulk at Netherlands tax hike
Newly proposed 29% tax regime is misguided and unworkable, say gaming execs
A number of egaming operators have warned proposals to tax its soon-to-be-regulated sector at a higher rate than initially indicated could severely damage the market.
Those with an eye on the Dutch market were left shocked earlier this month when the Netherlands’ ruling coalition revealed it had submitted proposals to tax online gaming at 29%, the same rate as land-based gambling in the country, as opposed to the initially proposed 20%.
While the tax rate could drop to 25% after three years if the online sector is considered large enough by that stage, it will be scant consolation for a number of operators who had eyed the Netherlands as a new growth market.
One chief executive at a mid-level operator told eGaming Review that the decision was “disappointing and misguided”.
Bet365 loses out in Romanian court ruling
Bet365 says it is “extremely disappointed” by the Bucharest Court of Appeal’s decision to uphold the Romanian regulator’s move to cancel the firm’s interim right to operate in the country.
Stoke-headquartered bet365 had applied to temporarily suspend the Romanian National Office for Gambling’s (ONJN) cancellation in October last year, raising concerns over the regulator’s behaviour and questioning the integrity of its actions.
Bet365 was left without a licence and more than ?20m out of pocket having paid back taxes as part of the licensing process.
Seven days in regulation:
Betting partner scheme “draconian”, says Coral boss
Coral has ruled out signing up to British Racing’s controversial authorised betting partner (ABP) programme in its current form, with the operator’s chief exec Carl Leaver describing the scheme as being both “draconian” and “unsustainable”.
In a letter to horseracing trade publication the Racing Post, Leaver set out the operator’s case against the 7.5% levy on digital UK horseracing profits, which comes in addition to the 10.75% already levied against bookmakers’ land-based businesses.
According to Lever, the new ABP scheme, which sees non-members blocked from striking commercial agreements with participating racecourses and events, has been introduced at the same time Coral’s UK racing costs have been on the rise.
Coral’s offer to pay a 7.5% levy on UK racing profits derived from both its retail and online businesses was later rejected by British Racing.
PokerStars reaches ?5.9m settlement in Italian tax dispute
Amaya has agreed to pay Italian tax authorities ?5.9m after the country’s financial police had accused its PokerStars subsidiary of committing fraud and tax evasion.
In March last year, Italy’s Guardia di Finanza alleged PokerStars had used Rational Group subsidiary Halfords Media Italy to hide away undeclared revenues, estimated to be worth more than ?300m, between 2009 and 2014.
At the time, police said its investigation into transactions between Halfords Media and PokerStars showed the company had “wilfully eroded” its Italian tax base and shifted income generated in the country to more tax advantageous jurisdictions of Isle of Man and Malta, thus avoiding tax of approximately ?85m.
FanDuel and DraftKings score major victory in New York
FanDuel and DraftKings have scored a major victory in their ongoing legal battle with the New York Attorney General after a court last week granted a permanent stay against an earlier injunction barring them from conducting business in the state.
The stay was granted by a panel of four judges from the Appellate Division of the New York State Supreme Court, and means both operators can continue offering contests to players at least until the case is heard by the Supreme Court.
A date has yet to be set for the hearing, but media reports suggest it will take place sometime in the Spring. In the meantime, a number of bills seeking to legalise DFS have been introduced to the legislature with an informational hearing taking place last month.