UK Gaming Framework

The UK has a well-developed and efficient regulatory framework for online gambling. The UK Gambling Commission, established under the provisions of the 2005 Gambling Act, has the authority to provide licenses and regulate gambling. As of September 2014, the UK Gambling Commission required all operators who are offering bets in the UK to hold operator licences from the Gambling Commission and cease to rely on licences issued by other regulatory bodies.

Who requires a licence?

Any person that offers bets to residents in Great Britain through remote means, or advertises in the UK, or places gambling equipment within the British territory requires a licence from the Gambling Commission.

Are only UK persons or UK established businesses able to acquire a licence from the Gambling Commission?

No, any person or company wherever they may be located are able to apply for a licence from the Gambling Commission. This leaves some scope for fiscal optimization. For instance, a company established in Malta, a full member of the European Union, may apply for a licence from the Gambling Commission benefiting from the advantageous tax refund system applicable to companies the shareholders of which are not citizens of Malta. Income tax in Malta is chargeable at the rate of 35%, however non-resident or non-domiciled persons are entitled to claim a 6/7ths refund from the Government of Malta on all taxes paid to the Inland Revenue Department. This is a tried and tested model that many operators are adopting.

Which activities are licenced by the Gambling Commission?

  • Lotteries and Lottery Messenger Activities
  • Poker
  • Betting Intermediaries
  • Pool Betting
  • Casinos
  • Betting Operators
  • Bingo Operators
  • Gambling Software Providers

Do the owners of a gambling business need to undergo due diligence with the Gambling Commission?

Any person holding a stake larger than 2.9% in the business, whether directly or indirectly, must be notified to the Gambling Commission but is not required to submit any additional documentation. On the other hand, persons holding a stake larger than 9.9% in the business, whether directly or indirectly, need to submit an Annex A.

Does the Gambling Commission carry out due diligence on the directors and managers of the business?

Yes, the Gambling Commission requires persons directing the business or holding a key position within the business to hold a Personal Management Licence prior to assuming their roles with a licenced operator.

Those responsible for the following activities at licensed gambling operators require a personal management licence (PML):

  • overall strategy and delivery of gambling operations
  • financial planning, control and budgeting
  • marketing and commercial development
  • regulatory compliance
  • gambling related IT provision and security
  • management of licensed activity for a particular area in Great Britain where you have five or more sets of premises for which you hold a premises licence
  • management of a single set of bingo and/or casino licensed premises

What is the rate of tax charged on betting proceeds?

The UK Government introduced a point of consumption taxation whereby all remote gaming operators must pay tax, referred to as Betting Duty, on gross gaming revenue generated from GB customers, no matter where in the world the companies themselves are based.

This tax is in addition to the Corporate Tax due on the resulting profits at the end of a financial year.

How can we help?

Over the past decade our organisation strategically developed a specialised remote gaming practice. Our team of specialists within our igaming unit has accumulated years of experience servicing igaming companies and has been involved in licencing online gaming companies in various jurisdictions. ARQ Advisory can assist you throughout the regulatory process of acquiring a remote operator’s licence from the Gambling Commission as well as assist you navigate through the various compliance requirements and licence conditions arising from being licenced in the UK.

For further information contact

  • Kris Baron

    Partner

    Member of the Information Systems Audit and Control Association (USA), Fellow of the Associatio... More

    T +356 2549 6000

  • Claudio Caruana

    Head of Regulated Industries

    Claudio Caruana began his legal career when he joined Fenech Farrugia Fiott Legal in 2011. He a... More

    T +356 2549 6000

Kindly fill in your details below and we will contact you.