Gibraltar in many ways is an extension of the United Kingdom. Found at the neck of the Mediterranean, this British Overseas Territory is home to sun, sea, sand, and the world-famous Barbary macaques. However, Gibraltar’s legacy isn’t simply one of a postcard holiday destination. Over the past decade this small nation has become a huge player in the iGaming sector, with companies flocking there due to favorable taxation laws. It’s reached a point where the economy of Gibraltar is now very much dependent on the iGaming sector, as it represents one of the islands leading income sources, representing approximately 25% of its GDP.
For years the iGaming sector and Gibraltar have maintained a positive partnership, but this relationship has been placed under threat in light of the highly controversial Brexit vote.
New challenges face Gibraltar in light of the Brexit
During the Brexit vote Gibraltar appeared to get lost in the shuffle. Outmuscled by the mainland UK, while Gibraltar had its say, it proved to be rather meaningless compared to the opinion of those that resided in the England, Scotland, Wales, and Northern Ireland. With Brexit now in the pipeline, Gibraltar faces several major economic challenges. It’s relationship with Spain and the linked border between the two presents the biggest issue. After Brexit Gibraltar will no longer be part of the EU. This means that cross-border travel will now be visa determinant. Issues with the Spanish border have raged for decades, with this matter only set to escalate. Most workers in Gibraltar live in Spain – as it is often more cost-effective to do so – so Brexit could effectively negatively impact the country’s workforce.
Spain has gone out its way over the years to cause problems with Gibraltar. Many expect them to continue to do so following Brexit, as it makes further efforts to “take back” the British territory. Gibraltar requires a frictionless border with Spain to operate efficiently, whether this is something that can be maintained post-Brexit remains to be seen.
A new deal provides extra breathing room
Gibraltar needs the iGaming sector as much as the iGaming sector needs Gibraltar. Throwing both a lifeline, the UK government has announced that it will ensure that market access remains for Gibraltar-based brands. Border free access for financial services and online gaming companies will remain in place until 2020 at minimum. This has given Gibraltar some degree of breathing room, as it looks to navigate the post-Brexit landscape.
During this time, Gibraltar is hoping that the UK and Spain can successfully thrash out a border agreement that will maintain the status quo. Addressing what commercial guidance will be required,
Gibraltar’s hub of companies will be seeking major assurances that their workforces will be protected. Considering that Gibraltar licenses a large number of big-brand online gambling sites, from Ladbrokes to William Hill, it relies on the UK market for more than 90% of all of its business under EU single market rules. Whether a package can be agreed between the UK and Spain regarding Gibraltar can be reached remains to be seen, but there is some cause for optimism.
Taking steps to assure the future of Gibraltar’s online gaming sector
More and more premium online casinos, the types featured on sites like top5casinosites.co.uk, are choosing to apply for an online gaming license issued by other countries, due to the uncertainty of Gibraltar online gaming sector future post-Brexit. With murmurings of companies looking to leave Gibraltar, the country is looking to assure those that the country can still thrive as an iGaming hub. As mentioned above, the UK has guaranteed companies an open link to British markets until 2020. They’ve also promised that due care and attention will be taken by the UK and Gibraltar to make sure that regulatory standards will be maintained between all involved. Ideally, this will be in a manner that will be designed to assure customer equivalence and protection on regulatory outcomes in a post-Brexit landscape.
Brexit will certainly represent a time of transition for Gibraltar, but if current promises do materialize, the iGaming sector on the “Rock” should remain largely as is.