Big Debate: Does a licence demonstrate your commitment to acting in best practice?

Yes

Adam Doyle, head of gaming, TruNarrative

If you have applied and successfully acquired a licence within a white-listed jurisdiction, then you’re making a declaration that, as a business, you are committed to acting within the best practices outlined by that jurisdiction. No matter how stringent and restrictive they might be, to retain a licence in the UK, Malta, Sweden and the Isle of Man for example, the cost of not adhering to these practices could mean hefty fines, a suspension and ultimately the complete removal of the licence altogether.

Whilst the absence of a licence doesn’t necessarily mean a business is acting outside of best practice in terms of compliance, regulation, and so on, going through the licensing process demonstrates that a business has invested in and built the relevant processes to act in a compliant fashion.

Holding a white-listed licence also builds trust with your customer base. It gives a top-level guarantee of security on numerous issues. These include security of funds (where deposits are held, speed of payment/withdrawal), GDPR issues and licensed operators should also, by default, minimise player harm due to the restrictions a licence puts on them, compared to unregulated businesses.

However, all this aside, as more and more M&As are happening within the gaming industry, holding a licence from a reputable jurisdiction can also uphold and even add value to a business as it looks to be acquired. Similarly, businesses seeking investment will benefit from having a licence where strict best practices must be adhered to.

Of course, there are many other trust factors a business can employ to allay the concerns of partners, affiliates, players and more. A game developer could have their suite of slots and games put through the rigorous examination of one of the leading testing houses. Operators could conform to other industry standards such as GamCare, eCogra, etc. However, the absence of a licence will still be a blemish on their report card.

No

Liam Mulvaney, commercial director, Gamingtec

No, you do not have to be licensed to be acting in best practice. Just look at the number of operators that incur significant fines each year from regulators like the UKGC.

Left entirely to their own devices, the vast majority of online gambling companies would prioritise safe gaming and RG as they absolutely want to protect players. This is not only from a moral perspective, but a commercial one, too.

Of course, the industry does not work in this way and nor should it – there needs to be some level of oversight and accountability provided by an independent body such as the Gambling Commission. But is the industry currently over-regulated? Absolutely.

While global licensing jurisdictions like Malta and the Isle of Man are more than capable of holding companies to account, most markets now have local regulations in place. This double layer makes it increasingly difficult for businesses entering these markets to survive, let alone thrive, and the unintended but inevitable consequence is that operators and suppliers are turning their backs on these global/locally regulated markets.

Just look at how many operator brands have withdrawn from the UK over the past 18 months while others are entering unregulated markets where the going is a little easier. These shifts are player-driven because regulators have, unintentionally it must be assumed, penalised the majority of consumers to protect the few.

This is a necessary precaution perhaps but one which is top heavy and has led to players seeking casinos which can offer them bonuses and gaming experiences that are more aligned to their preferences – these are increasingly unlicensed offshore sites.

It is clear that a balance needs to be found. The industry accepts and, in most cases, welcomes the need for regulation and licensing, but it must be sensible and proportionate if it is to really achieve the purpose of protecting players.