Is affiliate licensing a case of who dares wins?
Clarity Consulting director Tina Rawlinson on how affiliates can reap first-mover rewards in an affiliate licensing regime
The gambling industry knows that enforced licensing for affiliates is just around the corner, especially in the UK market, but what if there was already the fairy tale glass slipper of affiliate licences available with a highly regarded top-tier jurisdiction and regulator?
February 2019 saw enactment of the Online Gambling (Software Supplier Licensing) Regulations 2019 by Tynwald, the Isle of Man’s one-thousand-year old parliament.
The enactment was delivered with a muted fanfare and all media coverage focussed purely on the legislation’s creation of the much requested B2B Software Supplier licence.
The new legislation did not, however, just create a B2B software supplier licensing regime; the legislation wording is (cleverly) framed to potentially create a licensing regime for all B2B gambling service providers…which obviously includes affiliates.
Despite regulatory moves to enforce licensing of affiliates, the debate on whether affiliates should be licensed continues and while I believe in the theory of self-regulation, there are a number of reasons for affiliates to seriously consider licensing their operations, such as:
- The escalating ‘comply or die’ doctrine in the gambling industry – where jurisdictions/regulators are slow to implement and police international standards, PSP/banking and service provider-imposed restrictions are making day-to-day business increasingly more risky, complicated and expensive.
- The drive for a fully licensed chain – as the burden of compliance increases and with it the pressure for compliant B2C operations, it is only natural for B2C gaming operations to mitigate their own risks by reliance on licensed service providers as far as possible. The more of the operational chain that is licensed, the lower the risk. Indeed, a number of the larger operators – for example, PPB and 888 – significantly curtailed affiliate partnerships after the UKGC formally placed the burden of an affiliate partner’s activities on the licensed B2C operator. Surely, a licensed affiliate would have the potential of opening the door again!
- Tenable proof of playing fair – the affiliate industry prefers self-regulation with said self-regulation deemed to deliver the required industry standard of compliance. If an affiliate is indeed being fully compliant, why not license and get the third-party accreditation to prove it?
As with the fairy tale glass slipper, the key will be finding the owner, namely the affiliate that is prepared to take the business case to the Isle of Man Gambling Supervision Commission (IOM GSC) and work with them to codify the licensing conditions and framework for an affiliate regulatory regime. Could the affiliate self-regulation regime be the starting point?
In my opinion it is who dares wins – so which leading affiliate ‘dares’ to approach the IOM GSC, is prepared to put time (and resource) into a unique opportunity to help frame bespoke affiliate licensing conditions, and thereafter snugly slide their operation into the licensing glass slipper and claim the undoubted (first mover) rewards with the gambling operator royalty?
Clarity Consulting ‘dares’ to partner with such a brave affiliate, especially if they turn up on a white stallion!
One of the Isle of Man’s leading specialists in igaming licensing, Tina Rawlinson has launched her own advisory business – Clarity Consulting. The business enables the former Cavendish Trust Company director to focus on helping clients license, strategise, deliver and be compliant by using her 30 years’ international business experience and specialist igaming industry knowledge. Rawlinson is an accountant, a UK Gambling Commission Personal Management Licence holder, and a member of the International Association of Gaming Advisors. Clarity Consulting also allows her to explore a limited number of executive and non-executive director appointments suited to her wealth of corporate and igaming business experience.