“Brexit”- I bet that is a word you have heard about 1000 times a day for the last year! There is no doubt, love it or hate it, Brexit is happening. Over the next two years, the United Kingdom will be in negotiations and preparations to withdraw, in full, from the European Union. But what does this mean for jurisdictions such as Gibraltar?
Gibraltar has established itself as a haven for iGaming and Financial Services, but in the wake of Brexit- where does that leave it? Gibraltar is home to the headquarters and operational centres of many well-known iGaming operators such as Mr Green, NetEnt, NYX Gaming, and 888 Holdings, and it is known for its thriving gaming industry. It creates a lot of local jobs and brings millions into the economy every year. The future of Gibraltar is of a great importance but unfortunately it seems like things are set to change once England leave the EU for good.
There are many ways that Brexit will impact the territory- its lax taxation rules are sure to change once ties with the EU are severed, and Spain has said it will close its borders with Gibraltar as well. Concerns have also been raised about ease of travel, foreign workers applying for permits to live and work, massive fluctuations with currency, and different rules relating to taxation and business operations. There is no doubt that Brexit will create a long period of uncertainty and this is sure to have a knock-on effect on any business operating out of the area. For those companies that have business in Gibraltar as well as in EU Member States, it is uncertain what the rules of business and finance will be once Brexit happens.
There is also uncertainty over rising tensions between the UK and Spain. Spain have always claimed ownership of Gibraltar and would like to see the territory returned to the rule of Madrid, however the 30,000 Gibraltans who live there have voted twice, once in 1967 and once in 2002, to remain a part of the UK and there is no doubt that this will remain the case. Spain’s step to close the borders and to exercise its right to veto any trade deal propositions has been seen as an aggressive step which the British government have not taken too kindly. It makes sense that this tension would put off iGaming companies and drive them to consider other jurisdictions for their operation.
Another jurisdiction that has been labelled as a possible alternative to the Gibraltar peninsula is the small, Mediterranean island of Malta. An English speaking, ex-colony, with favourable tax rules, a well-regarded iGaming authority, and sunshine for 10 months of the year, it is already a popular location for many iGaming firms. The race is now on to see if the British Government can negotiate a good deal for Gibraltar in order to save its industries, or whether a mass exodus will occur over the next two years, to warmer, more favourable climes.