Gibraltar believes it will retain its spot as one of the best gambling destinations in the world despite betting operator withdrawals already.
The online bookmaker operator, Paddy Power Betfair, announced late last week it was closing its office based in the British Territory – located just below Spain.
The UK-listed gambling company merged with gaming giant, Betfair, more than a year ago but has only now decided on the relocation after reviewing its arrangements.
Paddy Power Betfair is adamant Brexit had nothing to do with its decision to shut down Gibraltar operations, including surrendering an online gambling license. Instead, the company says it was about simplifying and centralising operations. The betting operator shut down its Isle of Man operations last year for similar reasons.
The Gibraltar government reacted to the company’s exit, with a spokesperson telling the Gibraltar Chronicle “it has been clear for some time that the Betfair office was under review due to the new Paddy Power Betfair merged company consolidating its estate and operations across Europe”.
Betfair had been operating in Gibraltar for seven years and a spokesperson for the government said it was a “great working relationship” but added the “office has been found to be ‘surplus to requirements’ as it replicated activities undertaken elsewhere.”
Gibraltar relies heavily on the gambling industry with 40 percent of its GDP generated from online gaming and the 20 employees working in the Paddy Power Betfair office were considered to be “modest by comparison to other business to consumer operators with less than 20 staff at the current time.”
The spokesperson did say the government would be happy to work with the gambling operator again in the future.
Gibraltar’s gambling industry is going through a huge change and not just because of Brexit. In just the last year Bwin acquired GVC, Ladbrokes merged with Gala and 32Red and Stan James were acquired by Unibet which has brought more jobs to “The Rock”.
But Brexit is a big issue.
The UK’s choice to leave the European Union has reignited debates over territorial rights. While Britain has claimed the Territory since 1713, its proximity to Spain has caused the country to try and claim it back via Brexit negotiations.
Reports have already revealed some operators will leave Gibraltar if it leaves with Britain, including reports gambling operator, 888 Holdings, is considering relocating its headquarters to Malta.
“Whatever Brexit may produce for Gibraltar, [the] government will adapt its licensing and regulatory arrangements to ensure we remain the premier remote gambling jurisdiction,” the spokesperson for the Gibraltar government said.
“Gibraltar remains the premier and first choice jurisdiction for the biggest and best operators in this industry.”
The spokesperson said four operators had applied for a license in Gibraltar and while the companies cannot be named, they said the new additions will create more jobs for Gibraltar. They also added other advanced gambling jurisdictions were not doing as well.
The new applications could be put down to the extremely low-tax regime employed by the government, which many companies may see as a factor which outweighs the Brexit impacts.