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UK Casino Licences

Licenses should be granted to operate Internet Casinos in Britain
The Gaming Board for Great Britain has recommended to the Government that new legislation should be introduced to licence Internet casinos in Britain.
The Gaming Board for Great Britain, established under statute to regulate casinos in the UK has reported to the Home Secretary on Internet gambling. The Board's study was carried out in late 1999/ early 2000. The Gaming Board's research suggested that "The British population has a propensity to gamble … perhaps one per cent of British adults gamble on the Internet at some time in each week", and that "the amount of gambling is predicted to grow with it". Despite such high usage, current gaming regulation is still rooted in the 1968 Gaming Act. Internet gaming was beyond the original intent of those who drafted the legislation and the Gaming Board found that when applied to Internet gambling the legislation was "erratic". The current legal position on gaming is as follows:

  • It is illegal to set up an online casino site in Britain
  • However - there is nothing in the legislation which makes it illegal, or seeks to prevent, British residents gambling on the Internet from their own homes
  • The only licensed casinos which can operate in Britain are those on licensed and registered premises.
  • Overseas gambling operations are subject to restrictions on the extent to which they can advertise here. In the case of casino and similar gaming, this does not amount to a total ban but prevents advertisements which, to paraphrase, invite the public to subscribe money or to apply for information about facilities for subscribing money. Some Internet casino operators have begun to advertise within these constraints. Added complications arise because the whole question of what constitutes an advertisement on the Internet, and then what can or cannot be done if it is, remains far from clear.

    The Gaming Board considered 3 options for dealing with Internet gambling in future. The options considered were:

Option (i) retain the status quo
Under current legislation, British residents can gamble online - but only on sites licensed offshore. This means British residents are being allowed to gamble at offshore sites for which there was no means of ensuring such sites were operated properly or fairly. Furthermore, the government was losing revenue and tax. Revenue and tax from licensing Internet casinos is being diverted to jurisdictions, giving a boost to their economic situation. If the market continued to develop without British involvement some industry respondents suggested it might be too late to recover and make an impact as they will have already set up offshore operations.

Option (ii) introduce measures to prevent offshore Internet gambling
A number of measures were considered, but all deemed to be impracticable and probably unenforceable. The measures considered could have included simply making it illegal for a British resident to gamble online, including from their own homes. The Board considered such a measure was neither desirable nor enforceable (search and seizure rules invariably bring civil liberties into issue). Preventing access to overseas gambling sites also seemed impracticable, and a law making it illegal for offshore sites to accept bets from Britain would also be difficult to enforce as such sites were outside of British legal jurisdiction. The Gaming Board concluded that attempts at preventing offshore Internet gambling were neither sensible nor likely to be successful.

Option (iii) Legislate to permit, regulate and tax.
The Gaming Board's preferred option. By allowing sites to be licensed there could be proper regulation and control. Legislation would be needed to permit the licensing of Internet casinos based in Britain. In licensing such operations The Gaming Board would take responsibility for ensuring those granted a licence were fit and proper and had financial wherewithal to operate the gaming. By licensing such operations the Treasury would benefit also – and this was better than allowing the money to be paid offshore.

The Gaming Board's conclusion was that "a structured and coherent legislative system is needed which permits controlled and regulated Internet gambling sites in Britain." Since publishing its report, the Gambling Review Board in its Report to Government dated July 2001 has adopted the Gaming Board's recommendation for new legislation to licence British Internet casinos.