The Isle of Man Gambling (Amendment) Bill 2006 | Media Release | May 2006
Miles Benham | Managing Director & Senior Advocate | This media relase was originally published on 31 May 2006
As part of its continuing aim to be the jurisdiction of choice for online gambling operators, the Isle of Man Government has recently issued the Gambling (Amendment) Bill 2006 which will make a number of improvements to the Islands online gambling laws. The Bill should complete the legislative process and be law by around September 2006.
There are 4 main parts to the Bill:
- The restructuring and modernising the Isle of Man Gambling Control Commissioners.
- The creation of a Gambling Appeals Tribunal.
- The transfer of the licensing and regulation of online sportsbetting to the Online Gambling Regulation Act 2001.
- The power to have a designated official based off the Island.
Isle of Man Gambling Control Commissioners
The Bill changes the name of the Isle of Man Gambling Control Commissioners to the Isle of Man Gambling Supervision Commission (“the GSC”). In addition to a new name the Bill gives the GSC a new written constitution, transfers the GSC from the Department of Home Affairs to the Treasury and rather interestingly sets down a set of licensing objectives that the GSC must follow.
At present under the Online Gambling Regulation Act 2001 it is the Department of Home Affairs that grants online gambling licences (e.g. for online casino and poker) and prior to the issuing of the licence the role of the Commissioners is really limited to approving the designated official. The Bill increases the power of the GSC by transferring the licensing role to the GSC. The GSC will then be responsible for both the granting of online gambling licences and the continuing regulation of the licence holders.
The Bill provides that when exercising any of their functions under any of the Island’s gambling laws it will be the duty of the GSC to pursue and where appropriate have regard to the licensing objectives and to permit gambling that is consistent with the pursuit of those objectives.
The Licensing objectives are:
- ensuring that gambling products promoted by operators in the Island can compete effectively throughout the world;
- facilitating competition;
- facilitating the provision of modern products and services;
- ensuring that gambling is conducted in a fair and open way;
- protecting children and other vulnerable persons from being harmed or exploited by gambling; and
- preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime.
While it is unclear at this stage how the GSC will in practice implement the new licensing objectives and what effect those objectives will have on the working practices of the GSC, one would hope that the mandatory requirement for the GSC to ensure that “gambling products promoted by operators in the Island can compete effectively throughout the world” will help to ensure that operators holding Isle of Man licences will become the best placed to take advantage of the worlds markets.
The written constitution of the GSC provides that the GSC shall consist of a chairman who shall be an advocate, barrister or solicitor of at least 10 years standing and 4 members. The Bill sensibly provides that there must be at least one member with experience of online business and one with experience of gambling business.
After the end of each financial year the GSC is required to send the Treasury a report setting out the activities of the GSC during the year. A copy of the report will then be laid before Tynwald, the Island’s Parliament. By requiring the annual report to be presented to the Island’s Parliament a “review mechanism” is being created as once a year the activities of the GSC will be reported upon and made open to public scrutiny and debate.
Gambling Appeals Tribunal
Any potential concern over the increased power of the GSC is also addressed by the creation of a new appeal system in the form of an independent tribunal called the Gambling Appeals Tribunal (“the Appeals Tribunal”). The Appeals Tribunal consists of persons who both have the appropriate experience and are independent of the appellant and the GSC.
Appeals can be made to the Appeals Tribunal within one month of the decision being appealed against, in cases where:
- the GSC refuses an application for the renewal or variation of a licence;
- the GSC imposes a condition to a licence;
- the GSC varies a licence;
- the GSC varies the conditions subject to which a licence is granted;
- the GSC cancels a licence.
The Appeals Tribunal has power to affirm, quash, substitute or add to the GSC’s decision and reinstate a lapsed or revoked licence. It would seem sensible for the annual report on the GSC to the Island’s Parliament to record the number of appeals to the Appeals Tribunal and their outcome.
Online Sports Betting
Online sports betting is currently legislated for under the Gaming Betting and Lotteries Act 1988 (“the 1988 Act”). When this Act was drafted the business of online gambling did not exist and as a result the Act is now out of date as regards the online side of sports betting. To rectify this and to put sports betting on the same level playing field as online gaming the Bill transfers all online sports betting (online and telephone bookmaking) from the1988 Act to the more modern Online Gambling Regulation Act 2001 in respect of bets from persons who are not on the Island.
The Bill enables the Treasury to charge different levels of fees and duty for the different types of online gambling authorised under the Online Gambling Regulation Act 2001 (i.e. different application fees and rates of duty for online casino, poker and sports betting).
Under the present system there are two types of sports betting licence, the Public and the Restricted Betting Office Licence.
The Public licence is really designed for use by a bookmakers shop with persons who are either on the Island or in the United Kingdom visiting the shop either in person or via the Internet. Whereas, the Restricted licence is a licence to allow online betting from persons anywhere in the world apart from persons on the Island and those in the United Kingdom.
One problem with the present system of Public and Restricted licences is that if an internet operator wishes to take bets from anywhere in the world it is required to obtain both a public and a restricted betting office licence.
In an attempt to resolve this problem the Bill enables Online Sports Betting operators to apply for a licence under the Online Gambling Regulation Act 2001 rather than the 1988 Act. The new form of licence will allow bets to be taken from persons anywhere in the world with the exception of persons on the Island. In the unlikely even of an operator wishing to also take bets from persons on the Island then a licence under the 1988 Act will also be required.
The advantage for an Online operator of a licence under the Online Gambling Regulation Act 2001 are numerous and include an online version of the Anti Money Laundering Rules and the ability to extend the licence to include other forms of online gambling such as casino games and poker.
Off Island Designated Official
The Online Gambling Regulation Act 2001 requires all licence holders to have a designated official. While operators generally have little difficulty in finding a suitable person to act as their designated official it is acknowledged that the current requirement for the designated official to be resident on the Island is really unnecessary. The Bill recognises this and removes the requirement for the designated official to reside on the Island.
The Bill provides that where an operator’s designated official is not based on the Island then the operator must appoint an operations manager. The operations manager is a person resident on the Island who has been approved by the GSC. The operations manager is not subject to the same regulatory requirements as the Designated Official and accordingly it will be easier to find a suitable individual to act as the operations manager.
This new requirement should make life a lot easier for operators as they will be able to have their designated official based anywhere in the world.
The proposed changes are to be welcomed as they will enable the holder of an Isle of Man online gambling licence to have the potential to carry out virtually all forms of online gambling with a single licence.
Media Release | May 2006
