Hit play on Gibraltar

While Gibraltar is building a DLT economy as one of the key pillars, the gambling industry in Gibraltar remains a key contributor in terms of government tax yield and as a wider engine of GDP.

Indeed, in the future, particularly in the area of payments and games design, a convergence of those two sectors may emerge, but that will be incremental.

The gambling sector, despite Brexit and probably because Covid has increased the rate of digitisation, has sustained in Gibraltar with some 3,500 jobs being provided by the industry.

EU business has been relocated away, but Gibraltar remains the major UK-facing hub and is starting to grow as a hub for non-EU international business.

We are seeing continued interest in the jurisdiction from both B2C and B2B businesses, which see Gibraltar as a stable and business-supportive environment in which to grow.

Business and lifestyle advantages both serve to attract and maintain the gambling industry here, but another important aspect is the relationship the industry has with its regulator.

For those who would put Gibraltar’s good reputation at risk, in terms of poor anti-money laundering controls or a lack of social responsibility, the regulatory regime is far from benign.

However, for those who buy into good governance standards, treating customers fairly and having a strong commitment to compliance, they will find a supportive regulator, which strives to be pragmatic and to support innovation and commercial progress.

Research and education

I am particularly pleased that the Centre of Excellence in Responsible Gaming has been established at the University of Gibraltar with independent foundation funding and will, in the future, be making a major contribution in the areas of problem gambling research and education.

The aim is for the University to become a provider of choice for responsible gambling and anti-money laundering courses. The research faculty will utilise industry data to establish a reputation for quality research, which makes a contribution not only to the debate in the UK, but also worldwide.

Another important development is updating our gambling legislation to ensure that it is fit for purpose and able to deal with industry innovation by way of definition and control. The nature of the industry is changing.

Whilst there still a number of ‘blue chip’ gambling behemoths in Gibraltar, the industry and supply chain is now much more diversified and multi-jurisdictional.

Gibraltar has a major part to play as part of this tapestry, but has to adapt what and how it licenses, and to provide the flexibility for businesses to have all or part of its business in Gibraltar. This means licensing key parts of the supply chain as well as ensuring that all gambling activity, including marketing activity, that takes place in or from Gibraltar, is proportionately licensed and controlled.

That said, this has never been and never will be a “brass plate” jurisdiction for gambling company registration. We expect companies based here to establish proportionate substance.

Sticking to the principle of substance, not only means OECD compliance, but brings advantages to the wider economy; be that commercial property, elements of IT infrastructure, tax yield and wider macro-economic contribution.

We have now started pre-consultation of the draft legislation and the supporting regulatory framework before embarking on a formal consultation process and bringing new gambling legislation forward to parliament.

Plainly there is a degree of uncertainty created by the ongoing discussions regarding the EU/UK treaty on Gibraltar at which we are firmly at the table. However, I am very optimistic for a good outcome and that the gambling industry will sustain and grow in Gibraltar, even in the context of accelerating M&A activity.

I would end with the question, ‘why wouldn’t you establish or grow your UK and non-EU international gambling business from Gibraltar?’

The Hon Albert Isola MP, minister for Digital and Financial Services, HM government of Gibraltar, is responsible for raising Gibraltar’s profile as a well-regulated centre for financial services, digital technology innovation and online gaming. Minister Isola was integral in driving the creation of the world’s first purpose-built DLT regulatory framework, which became law in January 2018 for firms using blockchain to store or transfer value belonging to others.