How the UK have Thrown Gibraltar's Gaming Market a Lifeline

One of the great injustices of Brexit is that it will affect millions of people who voted for the exact opposite. This includes all of the devolved nations (aside from Wales), and the British overseas territory that is Gibraltar.

Arguably, the British electorate's decision to exit the EU has had the biggest impact on Gibraltar, where just 4% of residents voted to exit the Union and end the region's association with Europe.

There have also been concerns about how Gibraltar's lucrative gambling market may be affected by Brexit, amid concerns that border-free access to the UK would be no more. Below, we'll look at this in further detail, and ask how the UK have granted the region a lifeline recently.

Why Brexit Could Have Decimated the Economy in Gibraltar

Over the course of the last two decades, Gibraltar has thrived as an online gambling hub that offers relatively relaxed regulatory restrictions and tax advantages to operators. This has become the bedrock of its national economy, which has benefited greatly from the exponential growth that has defined the virtual gambling sector.

In fact, Gibraltar currently licenses dozens of big brand, virtual gambling sites, from 888 to Lottoland and countless more.

Pointedly, Gibraltar relies on the UK territory for more than 90% of this trading activity, under the rules and stipulations of the EU's lucrative single market. By virtue of its British territory status, the region has earned an influx of business while also benefiting from the free, cross-border movement of goods, peoples and services associated with European Union membership, which over time has become pivotal to its appeal as a desirable location for online casino operators.

With this in mind, exiting the EU could have had a seismic and ultimately devastating effect on the online casino market in Gibraltar, while also decimating the region's economy as a whole.

How Britain has Thrown Gibraltar a Lifeline

The impact for the UK economy may also have been pronounced, particularly with online gambling established one of the nation's true growth industries. Without the necessary provisions, leading operators may have left the UK and relocated to the EU, creating an economic void that would have been hard to fill.

Fortunately, the British government approach to protecting its own interests and those of Gibraltar, primarily by offering assurances that “the Rock” will continue to enjoy border-free access to the UK and EU market for financial services until 2020 at least. This will provide some much needed breathing space for both parties, as Britain and its independent territory strive to thrash out a new deal and regulatory framework that can thrive in the post-Brexit landscape.

Will this be Enough for Gibraltar?

While these assurances should help to safeguard the near-term future of Gibraltar's economy, fears remain about the region in the long-run.

After all, there's a limited window of opportunities for the Rock and the UK to thrash out viable terms, especially as the process cannot begin in earnest until Britain has officially left the EU on March 29th, 2019. Similarly, there are concerns that some licensees may have already jumped ship and relocated to the EU or a rival jurisdiction such as Malta where the status of operators is already assured.

For now, however, Gibraltar can breathe easy for now as it looks to safeguard its social, economic and financial future post-Brexit.
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