Bet365 Moves Headquarters from Gibraltar to Malta
Bet365 announced this week it would move operations from Gibraltar to Malta. The announcement sparked fears of a general exodus from Gibraltar, due to fallout from the Brexit issue. The online sportsbook and casino site announced it “confirms plans to expand its presence in Malta.”
The full Bet365 statement read, “Due to regulatory developments in various jurisdictions and the evolving global regulatory environment for online betting and gaming, we have decided to increase our existing presence in Malta, which provides a mature and robust regulatory environment for the industry.”
“We are taking additional property space and looking to recruit additional personnel in Malta to support our online operations and will also be expanding our infrastructural capabilities on the island.”
Bet365 Leaves Gibraltar Gaming Jurisdiction
For over a decade, Bet365 was a stalwart of the UK gambling companies that moved to Gibraltar, a British Overseas Territory, for tax purposes. Gibraltar has a population of only 32,000 residents, so the licensing fee of £425,000 a year and nominal 1% of gross gaming revenues paid to the Gibraltar Gaming Authority are a significant source of income for the territory.
The Brexit vote posed a mortal danger to Gibraltar’s economy. While the governments of the UK and Gibraltar have agreed to a framework for cooperation through 2020, the territory eventually will have to choose to attach its economy to either the European Union or the United Kingdom.
Malta Gaming Authority
Malta was a British colony from 1815 until 1964, when the island nation gained independence. In 1974, Malta joined the Commonwealth of Nations. It is also a member of the European Union and the Eurozone.
The Malta Gaming Authority is another major licensers of online sportsbooks, poker sites, and casinos. Malta has a population of 450,000 and is located in the central part of the Mediterranean, so it has a flourishing tourist economy.
Malta is taking steps to make their gaming regulations attractive to other UK gaming companies. Just this week, Malta announced it would enact better self-exclusion laws, which is considered an important reform that the UK Gambling Commission pushes.
Could Bet365 Be the First?
The fear is that Bet365’s decision is a foreshadowing of things to come. Gibraltar sits in a precarious location at the tip of Spain, which has resented the British presence there for 2 centuries. Gibraltar has voted down proposals to rejoin Spain in the past, but the Madrid government maintains the small enclave should rejoin the old country one day. In an era where Madrid’s government is playing hardball with Catalonia, the Brexit vote ushered in a troubling time for Gibraltar.
The gaming companies of Gibraltar employ a lot of Spanish citizens. If Gibraltar leaves the European Union, those employees might have trouble crossing the border each day to go to work. The move presents a number of issues.
Gibraltar Gaming Authority
Gibraltar licenses a number of top gaming companies which were founded in the United Kingdom: 888 Holdings, 32Red, Ladbrokes, Coral, Gala, Betfred, Lottoland, Virgin Games, Mansion.com, Party Casino, Bwin Casino, Stan James, William Hill, EuroGrand, and Carmen Media. The list reads like a who’s who of British gambling companies. The Gibraltar Gaming Authority is considered a first-rate regulator, but other factors might intervene.
Business executives do not like uncertainty. Gibraltar could join the EU, but it would mean higher taxes on all of those companies’ UK gambling revenues. It could remain with the UK, but it would cut those companies off from its EU gambling customer base. Moving to a protected and stable gaming environment like Malta makes a lot of sense.