Cyprus parliament pushes through controversial egaming bill
Bill banning casino, poker and exchange betting passed by Cypriot parliament " Betfair condemns legislation as having "serious flaws."
The Cypriot government has formally approved legislation which allows for the regulation of fixed-odds betting, but bans all other forms of online gambling, including casino, poker and exchange betting.
The new system imposes a 10% tax on sportsbook revenues minus winnings, with operators required to pay an additional contribution of 3% of gross revenues to a regulatory body, which then distributes 1.5% of the money to the Cyprus Football Association, 1% to gambling addiction charities, and 0.5% to other sporting associations.
While no information has been released on how the government plans to enforce regulation, following the passage of the bill president of the House of Representatives Yiannkis Omirou is reported to have called for the island’s authorities to act quickly to block illegal operators, with the Cyprus Mail quoting him as having urged law enforcement “to remove this cancer form the bowels of Cypriot society.”
The decision to ban services betting exchanges was originally disputed by the parliament’s Democratic Rally Party of Cyprus (DISY) and Democratic Party of Cyprus (DIKO), which proposed a system in which Cypriots would be able to use an exchange to bet on foreign football matches only. However, the Cyprus Mail reports that while this had prompted parliament to remove the ban on exchange at committee stage, the provision was reinstated and passed on Friday night.
Exchange operator Betfair, which generated around 4% of group revenues from the island in its results for the twelve months ending 30 April 2012 “ amounting to around £9m “before allocation of central costs” “ has slammed the legislation as containing “serious flaws” and being “inconsistent with European Union law” on several counts.
The company went on to say in a statement this morning that it is considering challenging the law, explaining that it has begun “working with advisors to understand the potential implications on its business and will be taking all necessary steps to reduce the impact on profitability through both legal action and cost management.”
Legislation was originally introduced in September 2010, designed to close a loophole which allowed operators to bypass a ban on land-based gambling by setting up shops allowing punters to gamble online. While this was seen as a move to combat criminal organisations using gambling as a source of revenue, it was criticised for grouping EU-licensed, private operators with such illegal operations, and the fact that the law did not apply to Greek monopoly operator OPAP.
Under the terms of a bilateral cooperation agreement between Greece and Cyprus OPAP is able to offer land-based betting products without being charged tax “ a move which has angered Cypriot citizens to the point where a number of OPAP outlets were burned in the weeks preceding the vote.
On Friday police had been stationed outside every OPAP shop on the island to prevent further violence. It is not currently known whether there have been any attacks since the passage of the vote.