Brexit deadlines are looming, and its time for the UK to make some very important decisions about its new relationship with the rest of Europe. While everyone is talking trade tariffs and health & safety laws, we can’t help but wonder how Brexit will affect the online gaming industry. After all, many UK casino brands hold licenses and have headquarters in other European countries.
According to a study by Copenhagen Economics , web businesses will be among the hardest hit by Brexit, along with pharmaceuticals, agriculture, retail and transportation – but does online gambling count as this particular type of online business?
The biggest impact will be felt by British employees of gaming firms abroad. Many companies are based in Gibraltar and Malta, which means that may not have the freedom establishment and the freedom to provide services across borders. So, this will be something that gaming companies will have to consider as UK makes its way out of the EU.
“Employees in England will have to worry about their professional future, depending on their legal status and the results of the Brexit negotiations,” says Joerg Hofmann, of Melchers, a law firm in Germany.
VAT is another issue. Currently, EU businesses don’t have to register for VAT for each state they operate in under the MOSS (Mini One Stop Shop) scheme. However, operators that are registered for MOSS in the UK may have to register for VAT.
Gibraltar, where many online gambling companies are based, is making preparations for Brexit in an attempt to keep UK companies after Brexit. Gambling taxes have been lowered from 1% to 0.15% on annual gross revenue from gaming operators – but licensing fees have been increased to £100 00 for B2C licenses and £85 000 for B2B licenses.
“It is undeniable that the Gibraltar based remote gambling industry remains the most significant in Europe, if not the world, but it is now sailing into headwinds,” says Albert Isola, Gibraltar’s Minister of Financial Services and Gaming. “These are created by the uncertainties of Brexit and challenges around the EU market access.”
However, not everyone is worried. Intouch Games, a company based just outside of Birmingham, has plans to expand across Europe . The firm has over 2 million players, and has created nearly 40 jobs in the West Midlands over the course of the past five years. Now, Intouch Games plans to open satellite offices in Hungary and Romania which will create over 150 more new jobs.
As you can see, no one is really sure how Brexit will affect the online gambling market. Everyone seems to have a very different idea about how things will go, and we won’t get any more reassurance until May and her team start making more solid decisions.