UK grey market rule could deter private operators

Privately held operators could decide not to apply for a UK licence due to the regulator’s new crackdown on grey market revenues, according to an executive at a UK-facing firm.

The source told eGaming Review the Gambling Commission’s new licence condition, which requires operators to provide evidence they are acting legally in relation to non-UK derived revenues amounting to 3% or more, may act as a deterrent to non-publicly listed operators.

“It is possible that those in private hands may find the rule to be overly restrictive, especially if they only command a minimal size of the UK market,” he said.

“I wouldn’t expect this to affect the few that hold roughly a 90% share between them but, coupled with the 15% tax, some may decide to turn their back on the UK altogether.”

Last week the Gambling Commission revealed the move was aimed at protecting operators from markets where rules could change “overnight” and to also ensure operators were acting in a responsible manner.

It also dismissed suggestions that it would be acting as an international arbiter and instead insisted operators would only have to prove that they weren’t “wilfully flouting” the law in grey markets.

The regulator plans to issue further guidance on this issue in the coming weeks, aware of the fact that the licence condition has stirred “much discussion”.

This week’s eGaming Review poll asks whether the new licence condition is workable and enforceable.