Online gambling is certainly not a new phenomenon however is also fair to say that historically, legislation and regulation of this industry hasn’t exactly been on the top of most governments’ to-do lists. Aside from a handful of the larger economic powers and some progressive smaller nations, Igaming has been put into the too hard basket by most legislatures over the last decade.
However this seems to have changed in the last year or so though. The last 12 months has seen a wave of governments around the world declaring their hand on proposed new laws that will, in one form or another, permit online gambling operators to offer their product to local residents. Of course there have been some notable intentions to ban online gambling, such as in Russia, but the overwhelming tide of legislative intent now seems to be in favor of licensing and regulatory regimes.
In Europe, the EC’s struggle to impose a unified, non-protectionist approach across all member states seems to be gaining traction, with France and Denmark this year announcing intentions to overturn existing bans in favor of a legalized and regulated environment, while Estonia and Spain have drafted laws that will open their markets to foreign licensed operators. Just this month a delegation of officials from South Africa’s National Gambling Board went on a fact finding mission to Antigua Barbuda to gain a better understanding of regulatory practices before returning to implement their own regulations. Also this month, the government of South America’s third largest economy announced that it will be fast tracking online gambling regulations that will, for the first time allow licensed operators to accept bets from Argentineans.
Even Costa Rica, long regarded as the wild wild west of online gambling, and home to hundreds of internet casinos and sportsbooks due to an absence of licensing fees, gambling taxes and regulations have announced that they will be implementing stricter controls and associated taxes on all operators.
And while there have been no legislative changes in the US since the Unlawful Internet Gambling Enforcement Act was passed by the Bush Administration in 2006, draft legislation is being presented to Congress in the coming months that will, if passed, lift restrictions currently imposed by UIGEA on US banks and payment facilitators with regard to online gambling transactions. Whether these laws will pass can only be speculated on, but there are indications that passage through House and Senate is not beyond the realms of possibility. For one, the proposed laws are attracting a growing list of co-sponsors from both sides of the political spectrum and secondly a number of large well resourced online gambling operators are starting to re-establish their US presence in anticipation of being able to recommence US facing operations in the future.
So why is there a (relatively) sudden rush from governments around the world to legislate in favor of online gambling? While most of the rhetoric attached to announcements of proposed new laws is something to effect that they will offer a better regulated environment and player protection in an industry that prohibitions have largely failed to curtail, cynics (including me) may cite another catalyst. Faced with severe recession and growing budget deficits, governments around world are desperately seeking ways to raise revenue. A regulated, and importantly, taxed, online gambling industry is currently very fiscally compelling – a number of governments have even admitted as such.
By Milton Shaw
Milton Shaw for igaming portal 4 Online Gambling. Visit online gambling legal issues for a discussion of some current regulatory regimes.