By Jana Sedlakova
Spain has finally issued its internet gambling licences. The Spanish gambling Act from May last year regulated mobile and online gambling in Spain for the first time. The tax for the services varies depending on the gambling/betting activity. Most gambling is subject to gross profit tax rising up to 25% of gross gaming revenue.
The new regime recognised 4 general licence categories under each of which are so called singular licences which must be obtained for the relevant product. Firstly ‘betting’ with singular licences for a) pari-mutual sports betting, b) pari-mutual horserace betting, c) sports exchange betting, d) horserace exchange betting, e) other exchange betting games (c, d, e licences not issued in first wave of regulation). Secondly ‘other games’ with singular licences for a) Roulette, b) Poker, c) Blackjack, d) Baccarat (punto banco), e) social games, thirdly competitions and finally ‘raffles’ (currently not regulated). There is likelihood that slot games could be regulated by the end of this year.
Those operators who have successfully applied for the Spanish online gambling licences are enjoying being at the forefront of the Spanish online gambling market.
Adherence to the new regulatory environment is key. Various firms have paid back taxes to the Spanish Treasury for their previous activities in the country, including the likes of Sportingbet and Bwin.Party. Licences have been issued to 53 separate companies including Cirsa, Codere, William Hill, Ladbrokes International, and Unibet’s B2B division Kambi.
The gambling laws from the 60’s and 70’s previously deemed irrelevant have been revived.
It is questionable whether obtaining a licence was not dependant on the tax settlement with the Spanish authorities but reading between the lines this seems to be the case. For example Bwin.Party, in a statement clarified their payment as a prerequisite to a successful grant of the licences: “the payment is intended to secure the Group’s position in Spain in the context of its application for eGaming licences”. Similar comments were made in the statement published by 888 Holdings: “following this payment, 888 believes that it has fulfilled all requirements necessary to receive a Spanish eGaming licence, with awards set to begin at the start of June 2012.”
A different question arises when considering the new Spanish regulation from the European Union perspective. It can be assumed that shelter for national interests will prevail here as it does in other Member-states. However, a level of cooperation is anticipated by some.
The industry response from the key players in the market confirms the general presumption that the future lies in regulated markets and as we see, at a high cost. The industry appears to have no choice but to pursue regulated activities and to operate with integrity. This is likely to intensify whilst public purses remain under pressure.