In one of the latest moves toward authorizing online gambling, slots and the implementation of exchange betting, regulators in Spain recently published the long-awaited betting and slots exchange regulations.
Licenses Will be Accepted
The proposals allow the DGOJ (Dirección General de Ordenación del Juego) Spain’s gambling governing body to start accepting new license applications, instantly brining to an end a process that had taken more than two years; especially for an economy in desperate need of revenue injection.
Increased Online Revenue
Up until now, vertical revenue in Spanish online casinos comprised of just 8.7 million euros in the first quarter of 2014, with an overall total of 66.9 million euros.
Online Operators to Get a Boost
Online gambling offerings are scheduled for launch on January 1, 2015 where they will be available for public use. Operators with already-approved licenses will be at the fore-front when the launch goes into motion as well as competition that have long waited the lessening of online gambling restrictions.
Licenses for online gambling, exchange betting and slots will be valid for a five year period, subject to renewal if conditions are met. However, a 25 percent tax on online gambling revenue and slots will be imposed, something that could discourage many newcomers, especially smaller operators despite the fact that they cater for diverse sectors of the population.
Authorities in Portugal also approved the much awaited proposals to relax the country’s closely regulated gambling market. Portuguese legislators approved plans that had been endorsed by predeceasing Ministers in an attempt to open up an online gambling market previously dominated by monopoly.
The upcoming regulated online gambling market in Portugal is set to become effective by year-end after national parliament gave the green light.
Last minute discussions were held just before the national summer break, interrupting a parliament session and forcing legislators to make a swift move toward creating a regulated online gambling marketplace. Authorities have now been given a 6 month period to deliberate and ensure that a bill is passed with new regulations in place before end 2014.
The plans collaborate with Adolfo Mesquita Nunes, the Portuguese Secretary of State’s statement in June about the implementation of new gambling laws when he said the bill will become effective by year-end 2014.
Although details about the upcoming gambling regulations will be reflected on over the next couple of weeks, most of the common points have been known for several months now.
When the draft bill is drawn up, and legislation becomes effective, the gambling industry in Portugal will function within a set periphery market overseen by the Portuguese Gaming Inspectorate.
If foreign gambling operators are interested to serve Portuguese players, they will be required to setup a subsidiary within Portugal, make an application to the ICJ to get proper gambling licensing, which will have a validity period of three years. They will also be required to satisfy other technical, administrative and financial requirements which include 250,000 euros minimum share capital, as well ensuring that their services operate from a domain name with a dot.PT prefix.
With regard to the parliament process, the approval period opens up a 6 month window in which law makers discuss and debate on the terms of the application process; outline tax rates and specify penalties for operators who breach the conditions of their licenses or those who operate illegally.
Initial expectations that the legislative process would be complete by year-end now seem to appear excessively optimistic, especially in light of the slow pace the legislative process is taking.
The RGA (Remote Gambling Association) has shown concern over what it sees as exorbitant levels of taxation that the Portuguese government is planning to impose. These concerns are attributed by the fact that Portugal owes the International Monetary Fund, European Central Bank and European Union, and needs to repay its bailout loans resulting in overly exaggerated taxes that are charged on online gaming companies. It’s seen as an unnecessary constraint on the market.
It’s not a secret that Portugal is in debt and in need of urgent funds; to stimulate an ailing economy and to repay its creditors. Likewise, Spain and other countries are showing interest to regulate online gambling and raise funds to pay their debts.
Other European and non-European Union Countries are beginning to follow suit as they look into increase income generating opportunities. Hungary, Brazil, Sweden and other countries are beginning to regulate online gambling in efforts to bring sanity and raise funds. In the case of Portugal and Spain, its yet to be seen how their regulations will affect operators, and if at all those high tax rates will attract foreign investors, or let alone promote small operators. It only makes common sense that, lower taxes attract more investment.