- WillHill argues that therei s no evidence to suggest remote gambling causes a serious social problem.
- Other countries passing gambling regulation did so justifiably to liberalize the market or end state monopolies; the UK has no such premise, its argued.
- Gibraltar Betting and Gaming Association has raised a litigation fund from licensees to fight to challenge the UK’s POC plans.
In testimony given to the Select Committee for Culture, Media and Sport, William Hill has blasted the main provisions of the UK’s proposed the Gambling (Licensing and Advertising) Bill.
The proposed UK legislation comes in two parts. The first part establishes a requirement for all firms offering gambling to UK customers to be licensed by the Gambling Commission. The second stage introduces a “point of consumption” tax levied only on gambling revenues from UK customers.
William Hill makes strong objections to the rationale for the new laws, insisting that “there is no significant social problem caused by remote gambling” and, furthermore, “there is no evidence that UK consumers face a disorderly or unfair remote gambling market; just the opposite.”
In the light of these two main points, William Hill argues that the reason for the new legislation lies elsewhere: “There can be little doubt here that the regulatory proposals are merely being used here as weak cover for the proposed new taxation measures.”
According to the testimony, gaming regulation in other EU countries has taken the form of ending state monopolies and or liberalizing the industry. William Hill argues that such measures are not needed in the UK and that all evidence contrary to the political policy agenda has been ignored.
As the result of the failure to research an “objectively justifiable case … based on real evidence of failure rather than theoretical and un-crystallised risk,” William Hill argues that the Government has produced, “a deeply flawed policy proposal” which ignores contrary data.
In this they are supported by William Hill Online’s regulator in Gibraltar. The Gibraltar Regulatory Authority’s Gambling Commissioner is Phill Brear, former Deputy Chief Constable of Yorkshire. He has been quoted as saying that the proposals “contradicted reality, research and the evidence base.”
As a further blow, William Hill forecasts that the “proposed legal framework, in its current ill conceived form, will lead to a strong and sustained legal challenge.”
It argues that the new laws will not satisfy the exclusion provisions in EU treaties and that they will be judged contrary to EU law.
The Gibraltar Betting and Gaming Association, whose members will be hit hard by the new laws, has raised a litigation fund of £500,000. If the government proceeds with the legislation in its current form they intend to “institute judicial review proceedings to challenge these measures.”
In order to show a positive attitude, William Hill helpfully suggests that the Committee propose amendments that will make the law practical while raising new revenues and providing consumer protection.
William Hill sees these changes in three key areas. Firstly, it believes that the UK should create an opt-out for companies regulated in Gibraltar. Gibraltar is a British Overseas territory, and a simple “whitelist” system could be introduced to prevent double regulation.
Next, it proposes a much lower tax level in the region of 5% rather than 15%. William Hill contends that margins are much lower in remote gaming than in live casinos, and that Denmark has shown that a separate tax rate for the two activities is justifiable under EU law.
Although not addressed in their proposed solutions, William Hill does strongly advocate increased enforcement measures to deter unauthorized gaming providers. A substantial section of their testimony argues that ISP blocking and advertising bans are never completely effective and that the proposals are, “without any teeth to tackle those who do not comply or to prevent detriment to the competitiveness of those who do.”
William Hill’s online revenues grew 27% last year, but the company claims that it paid as much in tax as it made in operating profits—2011 operating profit of £275 million, £272 million paid in tax.
Its share price has risen over 60% since the beginning of 2012.
The company has shown itself to be an aggressive legal challenger of restrictive regulation and laws that appear to break EU treaties. This combative strategy looks set to continue.