What Spain-UK Brexit Deal Means for Gibraltar’s Online Gambling

Today, Spain and the United Kingdom announced they have reached an agreement on the Gibraltar phase of the Brexit deal. If the accord is approved by the 27 EU governments not involved in the Gibraltar negotiations, then the UK and Spain will negotiate directly on the future of Gibraltar.

Spain’s prime minister announced his country would support the Brexit deal, now that its insistence of direct negotiation with the UK over Gibraltar was a part of the deal.

Previously, any deal over Gibraltar would have had to be a part of a wider agreement between the United Kingdom and European Union. Spain has claimed for centuries that Gibraltar is a natural part of the Spanish nation. The British Empire held the strategically located a rocky outcropping at the tip of Spain for over two centuries.

For those two centuries, Gibraltar has lived under British rule and been influenced by the British legal system and culture. Most of territory’s population of 32,000 residents are culturally and economically British, though they are ethnically Spanish.

Fabian Picardo, the chief minister of Gibraltar, said in a statement after the announcement, said, “Throughout our history we’ve stuck with Britain.”

Spain and the EU

Spain entered the European Union in 1986, thirteen years after the United Kingdom entered the EU. The terms of that deal required Spain to accept the British role in Gibraltar’s governance. On the good side, the Spain-Gibraltar border became an open border.

Now Spain is concerned that Gibraltar’s post-Brexit means a closing of the border. Many Spanish citizens commute to work inside the financial hub, so a border closure would hurt people and companies on both sides of the border.

Brexit and the Gibraltar Gaming Authority

Gibraltar is also concerned about its status. If Gibraltar is outside the EU, its companies might not be as well-placed for business as it was in the same. The same goes double for Gibraltar-based gaming companies, which might not receive the benefit of longstanding EU international commerce deals.

If so, then gaming companies like 888, Playtech, Bwin, William Hill, Ladbrokes, and Bet365 might move to Malta or other EU-friendly tax shelters. That would be a huge blow to Gibraltar’s economy, compounded by the fact the gaming companies would not be the only ones to leave.

Leaders in the UK government know that, and they know Gibraltar’s best hope for a good deal is for the UK to negotiate on their behalf. Also, negotiating directly with Spain is a better option than negotiating with a bloc of 28 countries.

Gibraltar’s Stance on Spanish Reunification

It is obvious what Gibraltar wants. In two separate reunification votes over the past few decades, the people of Gibraltar have voted against reunification with Spain. Gibraltar has served as a tax shelter for UK companies, including the online gambling industry. For Gibraltar’s citizens, remaining a British overseas territory maintains its status as a tax shelter and its basic independence. If it rejoins Spain, it will be subsumed in a much larger state and lose many of its natural economic advantages.

The government of Gibraltar released its own statement after the Spanish government’s announcement, which signaled its praise of the British government, its devotion to the Commonwealth of Nations, and a certain uneasiness about the late stage of negotiations.

Gibraltar’s statement read, “The unwavering commitment of the UK that it will negotiate future trade and other arrangements with the EU that work for all of the British family of nations, including Gibraltar.”

What Gibraltar Means to Spain

For Spain, the Gibraltar issue is one of prestige. So long as a foreign country maintains influence over part of the Spanish mainland, it is an irritant and a provocation. Gibraltar has been a point of contention for generations, and all Spanish leaders would like to end the provocation.

Spanish Prime Minister Pedro Sanchez, “I have just told the head of state, the King, that Spain has reached an agreement over Gibraltar. He said the agreement excludes the territory from the general negotiation between the EU and UK and “will allow Spain to negotiate directly with the UK over Gibraltar.”

Boris Johnson on Brexit Deal

To hear Brexiters speak about the negotiatons over Brexit, things have not gone well these past 17 months. British Prime Minister Theresa May did not support the “Leave” option during the Brexit vote, but took over for David Cameron with the pledge to negotiate the exit from the EU in good faith.

According to former Foreign Minister Boris Johnson, the minority UKIP faction, and a host of other Brexiters, the deal that was announced earlier this month is a disaster for the UK. Boris Johnson said the UK was “on the verge of making a historic mistake.” He said the deal would make the United Kingdom “rules-takers,” then added, “Brussels has got us exactly where they want us — a satellite state.”