The effects of ‘Black Friday’ are not only being felt in the USA as British government ministers have now decided to clamp down on offshore poker websites that operate in the UK.
The move is expected to allow the Treasury to grab a hefty slice of tax from a new ruling that will ensure all gambling operators active within the country obtain a license from the Gambling Commission if offering games, including online poker.
Immediately following the ministerial announcement, poker website Bodog issued a statement that claims they are the first operator to receive a remote and non-remote Gambling Commission gaming license.
If true, this is great news for Bodog – who sponsor the always-popular Poker in the Park event in London each year – as they will now move forward with plans to open high street shops throughout Britain.
The Department for Culture, Media and Sport (DCMS)’s John Penrose – the minister for tourism and heritage – said the law would protect consumers while closing a loophole that has allowed Internet-based gambling firms an unmerited advantage over British companies.
Of course, this new law follows in the wake of the US Department of Justice (DoJ) decision to halt the operations of online poker sites such as Full Tilt Poker, PokerStars and Absolute Poker on April 15 because of indictments relating to the violation of gambling laws when processing money transfers.
Penrose pointed out that “these proposals are an important measure to help address concerns about problem gambling and to bridge a regulatory gap by ensuring British consumers enjoy consistent standards of protection, no matter which online gambling site they visit”.
Additionally, the Conservative MP for Weston-super-Mare in the south-west of England stated that the government would “move as fast as we can towards a system which will fix the problem of offshore betting”.
The plan is to introduce a system that “will switch away from the current organisation which has driven many bookmakers offshore”, resulting in non-British websites looking to “sell gambling services to any consumer based in the UK” being forced to apply for a Gambling Commission license.
But not everyone is so certain that this law can be pushed through so easily, with leisure analyst Vaughan Lewis – who works for New York City-based global financial services firm Morgan Stanley – pointing out that the British government will have “to be careful as you can’t change the law just to raise taxes”.
Lewis noted that, “while the proposals claim to be driven by a desire for greater customer protection”, he is also perfectly aware that “they will also create an opportunity to levy duties on overseas operators”. The suggestion is that a 10% will be employed.
Penrose, meanwhile, issued a statement that proposes the Gambling Act 2005 ought to be altered so that “remote gambling” is controlled in relation to where bets are made and not on the location of a particular bookmaker or poker website.
The act overhaul would see every firm requiring a Gambling Commission license if providing bets to British punters or even advertising within the UK.
However, industry insiders emphasised that the UK government would need to take the initiative in enforcing the new law to clamp down on unauthorised companies.
But Richard Glynn, who is chief executive with British-based gambling firm Ladbrokes – which supplies offshore Internet business, and telephone and retail services within the UK – said that his company “will work with government towards a comprehensive solution which levels the playing field and helps protect British jobs”.
Gambling experts believe this latest development will likely put greater pressure on PokerStars, Absolute Poker and Full Tilt Poker as, when considering license applications, the Gambling Commission has to assess “the honesty and trustworthiness of the applicant and or person(s) relevant to the application”.
But that’s not all as the “criminal record of the applicant and or person(s) relevant to the application” is also vital.
Those three websites will undoubtedly be more than a little concerned about gaining a license in the UK, depending on the outcome of cases to be heard in the USA.