Gibraltar’s gambling sector is bracing for regulatory changes as the territory’s long-awaited Gambling Bill moves towards parliamentary debate. The proposed legislation expands the scope of activities requiring licences, with particular implications for business-to-business (B2B) service providers, marketing companies, and holding companies with gambling interests.
Expanding the scope
Andrew Lyman, Gambling Commissioner and Executive Director at Gibraltar’s Ministry of Justice, Trade and Industry, confirmed that the publication of the new bill has prompted “an increase in the volume of enquiries from the sector and advisers.”
He explained: “Sections 17-19 define the scope of B2C and B2B (regulated activities). Gambling marketing and Holdcos (holding more than 25% in a relevant gambling company – including outside Gibraltar) are also brought within scope.”
The bill itself sets out detailed provisions in Section 19, stating that a person provides facilities for gambling if they are involved in the organisation, management or control of gambling activities, whether in or from Gibraltar. It further clarifies that the definition extends to “activities constituting licensable supply chain services to Gibraltar licensed operators.”
Lyman noted: “S19 defines ‘providing facilities for gambling’ and this now extends to management control in or from Gibraltar. This may capture certain multi-jurisdictional models that were previously not in scope.”
Implications for existing operators
While the government intends to “grandfather” existing licensees into the new framework (meaning that companies which already hold a valid Gibraltar gambling licence won’t have to reapply from scratch the moment the new law takes effect), Lyman cautioned that they must assess whether other functions they perform now fall under regulatory oversight.
“Those businesses will need to look to see if any other functionality conducted in or from Gibraltar falls within scope,” he said. “Gambling marketing companies in Gibraltar will also need to start a dialogue, ideally having taken advice, with the Gibraltar Gambling Division regarding the licensing process as the grant of marketing licenses is on a prima facie restrictive basis and at the discretion of the Licensing Authority.”
The draft legislation includes powers for the Licensing Authority to refuse an application if it believes the proposed activity could “adversely affect the reputation of Gibraltar as a centre for the conduct of gambling.”
A pragmatic approach
According to Lyman, “Gibraltar is host to a number of multi-jurisdictional business models and also acts as a service centre. We will take a pragmatic approach and will be supportive of any business that does not pose a risk to the reputation of the jurisdiction.”
He stressed the importance of early engagement: “Once the Act is implemented there will be a transition period, but if you are a gambling B2C, B2B (supplying services to, in or from Gibraltar), marketing co or Holdco, now is the time to start thinking whether or not the activity you perform is defined as ‘Regulated’ and subject to licensing down the line.”
The Commissioner added: “We would prefer all businesses to engage early (a) so that we have a complete understanding of all the different business models out there (b) so businesses can plan strategically by understanding our position and risk appetite.”
Clear and transparent disclosure
One area where officials will not compromise is on the completeness of information provided by applicants. “What we can’t give are opinions based on a tailored (partial) version of the business model. Businesses will need to be clear and transparent about their models and be prepared for in-depth questions,” Lyman said.
He concluded: “I am committed to engage (alongside advisers) to ensure an effective and pain-free transition to a new Act as possible.”
If passed in its current form, the new Gambling Act will usher in an era of broader oversight, a formal licensing framework for a wider array of businesses, and a reinforced emphasis on protecting Gibraltar’s standing in the global gambling industry.
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