Regulation round-up 25 November 2014
The biggest regulatory news from the egaming industry in the last seven days (19 November to 25 November 2014)
Operators face multi-million pound VAT hit
Changes to how VAT is applied inside the European Union from 1 January could see some operators facing higher taxation costs
The online gaming industry is set to be whacked with a multi-million pound VAT bill next year as the European Union implements changes to how VAT on electronic services is applied within its member states, with some operators facing a seven-digit hit to their bottom line.
From 1 January Europe-facing businesses will have to pay a levy based on the rules of the country in which their services are being consumed, rather than where the business is based, as is presently the case.
And with many businesses situated in VAT-free jurisdictions, or countries which waiver VAT on gaming products, operators may find their levels of tax spend increasing markedly in 2015.
Not all countries apply VAT with a large majority of EU member states, including the UK and Italy, applying an exemption to online gambling and gaming products.
GB operators given deadline to display funds protection ratings
Great Britain’s Gambling Commission has published details of the rating system to be used to measure the strength of customer funds protection schemes implemented by licence holders.
The three-tiered system has been designed to help consumers to assess the strength of operators’ respective segregation methods and to inform decisions on depositing money.
Operators have been given until 31 December to publish the rating system, which sets out basic, medium and high levels of funds segregation, in their terms and conditions.
Seven days in regulation:
Dutch regulator commits to info sharing deal with Malta LGA
The Dutch gambling regulator has signed a Letter of Intent with the Maltese Lotteries and Gaming Authority (LGA) to formalise information sharing between the two organisations.
The agreement will be followed by a Memorandum of Understanding (MoU) once the Netherland’s new gambling act is signed into law, which is likely to be next year.
A spokesman for Kansspelautoriteit told eGaming Review the agreement is designed to assist the Netherland’s shift to a licensed egaming framework.
Opinion: ASA review of gambling advertising missed a trick
In looking to score quick and easy points in the media, the Advertising Standards Authority’s recent review of gambling advertising failed to help the industry in any way, and could have dangerous implications if taken at face value.
The report’s underlying, yet never-mentioned foundation, is that the number of complaints about gambling ads is on the rise. That may be so, but what isn’t made clear is if that number is rising in proportion alongside the rise of gambling ads on TV.
Take the recent Ofcom investigation into gambling advertising. It stated that there were just over half a million ads on TV in 2008, compared to almost 1.4 million in 2012.
California state attorney attacks online bingo site
The future of California real-money bingo site DesertRoseBingo.com has been thrown into doubt after the state’s attorney general filed a lawsuit seeking to temporarily shut the site down.
Earlier this month the San Diego-based Santa Ysabel tribe launched DesertRoseBingo.com site to players over the age of 18 and located in the state, with platform partner Great Luck.
But attorney general Kamala Harris has filed a lawsuit with the US District Court for the Southern District of California, claiming the site breaches state and federal law.