The UK Gambling Advertising and Licensing Act of 2014 Explained

Online gambling has been legal in the UK since 2005 when the Gambling Act was passed. However, only those above the age of 18 are allowed to participate in online gambling. The Gambling Act of 2005 was passed in 2005 but became effective from 2007. It applies in the UK territories of Wales, England and Scotland.

It is this primary law that legalized online gambling and tightened regulation of the gambling industry through the formation of the UK Gambling Commission. Apart from formation of the Gambling Commission, this law had a tremendous effect on gambling.

In 2014, the Gambling Advertising and Licensing Act was passed bringing to force new regulations that include the enforcement of additional tax revenue.

What Is The Gambling Advertising And Licensing Act Of 2014?

This Act is an update of the Gambling Act of 2005. Among its main provisions is the requirement that all overseas gambling operators must obtain a license before offering their services to consumers in Britain, and to be eligible t advertise their services to UK players.

Once issued the license, they will also now be required to pay a 15% tax on all their profits derived from the UK market. In addition, they will also have to keep the Gambling Commission informed with regard to any suspicious gambling practices they might discover.

The main parties affected by the Gambling Advertising and Licensing Act of 2014 are remote gambling operators who are not based in the UK but offer gambling services to consumers in the UK.

Effects This New Law Has On UK Online Gambling

The Gambling Advertising and Licensing Act of 2014 will have a major effect on the UK online gambling industry. Some of these likely effects include:

Increased Market Share Of Big Brands

The UK is one of the most lucrative online gambling markets in the world. For this reason, most of the big companies that can afford to comfortably pay the 15% point of consumption tax are likely to remain in the legal UK online betting market rather than move their business out.

However, smaller businesses are likely to limit their presence in the UK or take their businesses to other European markets with more favorable tax laws. Some of these businesses have already left the UK market to avoid the additional regulations and tax burden. The net result of all these will be an increased market share of the big brands in the industry.

Less Advertising, Bonuses And Promotional Offers Are Possibilities

The Point of Consumption tax is likely to put pressure on the budgets of the online gambling operators. As a result, they are likely to reduce their expenditures previously designated to advertising and promotional offers.

Moreover, since the commission cannot offer adverting-only licenses, many non-UK operators that advertise in the UK are likely to be negatively affected. For example, 188Bet has a relationship with Liverpool where it advertises during its marches.

The 2014 Gambling Act is likely to have a negative effect on such relationships due to the restrictions and additional regulations surrounding advertising practices.

Because player welcome bonuses and promotions are such an integral part of the competitive nature of the online gambling sites, we will still see those offers available; however they may be slightly modified to accommodate the additional tax burdens being placed on the gambling site operators. We do not expect to see dramatic changes here, but slight modifications are likely.

It is also worth watching the odds at the site at which you play. It is within the realm of possibility that operators will attempt to increase revenue through modifying odds to favor the house just a little bit more while still remaining competitive within the industry. In order to achieve this, any modifications will have to be very minor, but it still bears scrutiny on the part of the player.

Safer Gambling Market

By increasing regulations, this new law is likely to reduce any remaining fraud or unethical practices in the UK online casino industry thus making it a more fair and secure environment. The point of consumption tax is also likely to limit the number of the gambling operators in the UK to only those that are reputable as unscrupulous businesses rarely want to comply with such regulations.

Even off-shore operators will also now have to comply with increased levels of legality and security being added to an already stringent range of UK gambling laws, hence eliminating those not willing to make such investments in order to protect their customers.

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