Inside Asian Gaming

69 September 2013 | INSIDE ASIAN GAMING INTERNATIONAL BRIEFS UK Will Tax Offshore Operators The British government is serving notice that gambling operators taking bets in the country over the Internet will no longer enjoy the shelter of their offshore tax havens. Ladbrokes, William Hill, bwin. party and Betfair are among the industry giants affected by a new point-of-consumption tax equal to 15% of gross revenue that takes effect in December 2014. The rate is about the same as that paid by onshore operators, and estimates are it could cost the offshore segment £300 million (US$465 million) a year based on a market valued at roughly £2 billion. “It is unacceptable that gambling companies can avoid UK taxes by moving offshore, and the government is taking decisive action to ensure this can no longer happen,” Economic Secretary to the Treasury Sajid Javid said. The tax is incorporated in new legislation that will require all UK-facing operators to hold a license issued by the Gambling Commission, bringing to an end the so-called“white list”that allowed offshore operators to market their services in the UK. Violators will face unlimited fines, prison terms and license revocation. The last decade has seen almost all of the country’s major bookmakers and gambling operators move their online businesses to Alderney, Gibraltar, the Isle of Man and as far as the Caribbean to take advantage of tax rates ranging as low as 1% in some jurisdictions to an effective 0% in others. “We knew it was coming,” said Clive Hawkswood, chief executive of the Remote Gambling Association, a trade group representing the industry. “The focus for us now is on trying to get the actual rate of the tax reduced.” Gibraltar, however, is reported to be incensed at the plan and is considering an appeal to the European Commission. William Hill, which has the largest share of the UK online market, also has said it may challenge the tax as a breach of EU competition law. Operators have until 30th September to comment on the legislation. Wynn Seeks a Piece of NJ Web Market Wynn Resorts has filed an application with New Jersey regulators for an Internet gambling license. Las Vegas-based Wynn has no casino operations in the state, but the move makes it one of dozens of companies seeking the licenses from the NJ Division of Gaming Enforcement ahead of a targeted launch date in late November. Web gambling will be offered only by Atlantic City’s 12 land- based casinos, which are partnering with online gaming companies. Unlike Nevada, though, which permits only poker, the sites will offer casino-style games and slots. New Jersey in February became the third state to legalize online gambling. Like its predecessors, neighboring Delaware included, participation will be limited to residents or visitors physically present in the state, which leads observers to believe that as the most populous market to date to regulate the industry, it will be the most lucrative. Analysts project Nevada’s current poker-only market will yield US$50 million to $250 million in annual revenue, while New Jersey could generate $250 million to $500 million. MEI Releases Next Gen Support Tool for SC Advance MEI’s new PPM Advance is a support tool for the SC Advance which has features to lower maintenance costs and increase operational efficiency. The product encompasses simpler management of software and performance monitoring. “The PPM Advance provides new functionality to technicians. And, as a result, it makes MEI a better partner in the continuous battle to reduce the overall cost of operations,”says MEI Senior Vice President—Americas, Eric Fisher. The PPM is a portable programming module that has four components for operators— updates in currency data, configuration software and data, performance diagnostics and audit data reporting. The module has the capacity for several languages and increased memory. Operators will be able to tailor the firmware to meet their needs. The PPM Advance will also have a Bluetooth function for mobile and tablet devices on Android. Operators will be able to download software from a remote location and add the Soft Count asset numbers. “Operators’ toolbox for cash management solutions just got bigger,” claims Mr Fisher. 888’s Earnings Nearly Double British online gaming company 888 Holdings’ full-year earnings nearly doubled, helped by strong growth of its casino and poker offering, and the company namedBrianMattingley as chief executive. The company, which operates 888 casino, poker, sport and bingo brands, said it planned to invest in several newly regulated markets across Europe and the United States. More Britons prefer to stay at home, watching TV and gambling online, updates from consumer-facing companies showed, amid fears that the UK will slip back into recession. For 2011, the company’s earnings before interest, taxes, depreciation, and amortisation rose 94% year on year to US$55.6 million. Revenue increased 26% to $331.1 million. Last month, Britain’s second-biggest bookmaker Ladbrokes, which pulled out of talks to buy 888 and Sportingbet last year, posted a strong full-year profit helped by sales growth in gambling machines. Former CEO Gigi Levy stepped down in April last year. Media reports had said that Levy was frustrated with the slow progress of the potential takeover by Ladbrokes, but 888 had said that was not the case. The PPM Advance