For some time now, Brexit is looming over the fate of all aspects of the British economy. Despite the fact that its future is getting vaguer by the day, a so-called “hard” Brexit could turn out to be the only option for the country to leave the European Union (EU) on March 29th, 2019.
At the time when Brexit was officially announced, it became clear that it would affect the entire economy of the UK, with the local gambling industry being no exception.
For the time being, gambling services are among the favourite pastimes of British residents. As a matter of fact, gambling accounts for a massive piece of the country’s economy, worth more than £15 billion to date. According to analysts, the value of the gambling sector has been rising at approximately an 8% rate year or year. Online gambling, on the other hand, has seen its market share rise over the last several years, with its market share currently accounting for about 40% of the entire UK gambling market. It is also the sector which is expected to be most affected by upcoming Brexit.
Serious Consequences Could Follow for Horse Racing after Brexit
Horse racing could be one of the sectors in the UK gambling industry to suffer the negative impact of Brexit the most.
For the time being, there is a streamlined process regarding the transportation of horses for sporting events thanks to the free movement between France, Ireland and the UK. A “hard” Brexit could be the end of this agreement, with the withdrawal’s immediate effect expected to first be seen at one of the biggest sporting events of 2019 – the Grand National, which is scheduled to be held only a week after the announced Brexit date.
In other words, a “no deal” Brexit could prevent many jockeys and horses coming in the UK from Ireland, and at a later stage be a severe blow for the entire horse racing industry.
Brexit’s Impact on British Overseas Territories’ Gambling Sectors
Currently, there are a number of jurisdictions which are under the control of the UK, so they are also expected to be affected by the Brexit. To date, there are 12 overseas territories which are under the country’s control and six jurisdictions which serve as online gambling regulators as part of the UK.
Undoubtedly, the UK Gambling Commission (UKGC) is the largest regulatory body in the country, with it controlling the entire casino, betting, poker, gaming and online gambling services. The Gambling Supervision Commission is the major regulatory body in the Isle of Man, while gambling in Gibraltar is currently overseen by the Gibraltar Regulatory Authority. Three more regulatory jurisdictions exist, including the Alderney Gambling Control Commission, the Jersey Gambling Commission and the Guernsey Gambling Control Commission.
According to experts, the most severe impact of the country’s withdrawal from the EU is most likely to be seen on Gibraltar and the Isle of Man. Both territories have drawn benefits of being part of the UK and the EU. In fact, Gibraltar has been a preferred hub for many online gambling operators due to its more favourable regulatory and tax regime.
There have been some doubts whether Gibraltar will remain under British sovereignty after the Brexit, considering the fact that Spain also has had an appetite for taking advantage of the situation. “The Rock”, however, chose to remain as part of the UK, at a time when around 60% of the workers in its gambling industry commute from Spain on a daily basis.
Brexit could seriously trim Gibraltar’s gambling sector after the free movement is slashed. This, on the other hand, would probably lead to many layoffs, especially in the gambling sector, in case that Spain chooses to tighten up the border controls, not to mention the fact that major gambling operators could be forced to relocate their operations to the market of another EU member state or fully close their business.
The same applies to the Isle of Man, with the latter being a popular hub for some large gambling companies which currently hold an operating license in the UK.