Online Casino Exodus From UK Raises Concerns - 08-09-09

August 9 - As reported in the UK press last week, Spots betting and online casino operators including big names like William Hill and Ladbrokes intend to move the operation of their betting and gambling services to offshore jurisdictions.

William Hill plc have announced that they will move operations to their existing Gibraltar headquarters. Ladbrokes has now followed suit and will make the move before year end.

The reason behind these moves is tax: Gibraltar's tax rate is a mere 1.5% compared to  15% in the UK.

Gibraltar's policy encourages online casino companies to move operations to its territory. It easily beats the high taxes that companies must pay if based in the UK, which is "unsustainable," according to Ladbrokes Chief Executive, Chris Bell.

The British bookmakers leagues seem to have concerns over the moves, having asked the UK government whether Ladbrokes, William Hill and the other online casino companies who plan to move will still be subject to stringent reporting requirements, e.g. in the case of suspicious betting activity.

On this issue it appears as if there should not be cause for alarm as the sportsbooks stand to gain so much from their combined efforts to expose fraudulent activities. A good example is the recent tennis betting scandals where the bookies played a big role in detection and exposure of suspicious betting activity.

Another big player in the betting industry, Betfair has reacted to the news by criticizing the UK government for its excessive tax regime, noting the low taxes levied on offshore operators.

Although Betfair has no plan to relocate immediately, it has a base in Malta from where it operates its non-UK business.

These moves have been the topic if speculation for some time now and hardly come as any surprise.