The Betting (Amendment) Bill 2012 (the Bill) was published on 19 July 2012 by the Minister for Finance, Mr Michael Noonan T.D.
If the Bill becomes law, it will introduce a new licensing and taxation regime for remote (online) bookmakers and betting intermediaries (betting exchanges). It will also introduce changes for land-based bookmakers. The Bill has been expected since May 2010 when the then Taoiseach, Brian Cowen, (the Irish Prime Minister), announced that the Irish Government intended to tax online betting and to introduce licences for overseas betting providers.
Main Points of the Bill
- Once a Bill becomes law those that meet the definitions of a “remote bookmaker” and a “remote betting intermediary” must apply to the Revenue Commissioners for a remote bookmaker’s licence or a remote betting intermediary’s licence. A remote betting intermediary is defined as “a person who, in the course of business, provides facilities that enable persons to make bets with other persons (other than the first mentioned person) by remote means”. The Bill defines "remote means” as including “the internet, telephone and telegraphy (including wireless telegraphy)”. Essentially, the same requirements exist for remote licences as a land-based bookmaker's licence.
- The excise duty for a remote bookmaker’s licence and a remote betting intermediary’s licence will be €5,000.
- The 1% turnover tax will be extended to remote bookmakers.
- A 15% commission tax will be introduced for remote betting intermediaries.
- A company can now apply for a bookmaker’s licence in addition to an individual. A company’s managing director, chairperson, CEO or persons acting as such can be held personally liable for any breaches of the Betting Acts 1931 to 2012. Those persons must apply for and hold a Certificate of Personal Fitness (CPF) from the Superintendent of the Garda Síochána (a high ranking Irish police officer).
- Surprisingly, Ireland has not followed the lead of the UK by removing the prohibition on enforceability of bets in court: wagering contracts remain void. However, a Superintendent of the Garda Síochána can refuse to grant a CPF if a bookmaker has "unreasonably refused to pay sums due to persons who had won bets".
- A bookmaker’s licence will also allow the bookmaker to accept bets by remote means (e.g. telephone) provided that the annual value of all such bets does not exceed the lower of €200,000 or 10% of the bookmaker's turnover. A remote licence is required if remote bets exceed the aforementioned threshold.
- A person must be a licensed remote bookmaker to carry on business as a remote bookmaker from a place outside Ireland by means of an internet website that may be accessed by a person from a place in Ireland. Remote betting intermediaries must also have licences to carry on their business. This means that unless remote operators have an Irish licence, they must block access from people in Ireland or risk incurring extensive sanctions. It is expected that remote operators with licences in other jurisdictions will raise concerns with the Government and the European Commission with regard to the legality of these provisions.
- Only a licensed remote bookmaker who carries on the business of or acts as a remote bookmaker from a place outside Ireland may communicate or attempt to communicate with a person by remote means (e.g. telephone, internet or telegraphy) for the purposes of the making of a bet or bets. The same licensing obligation applies to remote betting intermediaries. The Bill defines what it means for a person to “communicate” with another person but the definition will be the subject of much debate.
- Contravention of the above mentioned prohibitions will allow the Minister for Justice and Equality to serve what is known as a "Notice". A Notice is a document which specifies the contravention and sets out the steps to be taken for the purposes of securing the cessation of the contravention. If the Notice is contravened, the person shall then be guilty of an offence and shall be liable to substantial fines.
- In circumstances where bookmakers, remote bookmakers or remote betting intermediaries are believed to be in contravention of certain prohibitions under the Betting Acts 1931 to 2012, the Minister may make an application to the District Court for the following orders:
- An order that credit institutions cease conducting business with the bookmaker, remote bookmaker or remote betting intermediary.
- An order that advertising in the State on behalf of the bookmaker, remote bookmaker or remote betting intermediary be prohibited;
- An order that any sponsorship of a sporting event by the bookmaker, remote bookmaker or remote betting intermediary be prohibited; and
- An order that telecoms providers and internet service providers prohibit access to the websites of the offending remote bookmaker or remote betting intermediary.
These are very significant orders and there is no doubt that they are intended to act as a major deterrent.
- The Bill provides for prosecutions in absentia, which will deal with prosecutions against overseas bookmakers who fail to present themselves before an Irish court.
- Registers of Licensed Bookmakers and Remote Bookmaking Operations to be published on the internet by the Revenue Commissioners.
- Carrying on business as an unlicensed bookmaker and/or remote bookmaker and/or remote betting intermediary constitutes an offence. In addition, persons holding themselves out as a bookmaker and/or remote bookmaker and/or remote betting intermediary constitutes an offence. Persons guilty of such an offence could be liable for fines of up to €100,000.
- Fines will be substantially increased for the offence of carrying on any trade, profession or business (other than bookmaking) in a registered bookmaking premises.
When will the Bill become Law?
It is expected that the Bill will become law in either late 2012 or early 2013, subject to any amendments made by the Houses of the Oireachtas (Ireland’s upper and lower Houses of Parliament), and amendments that may be required by the European Commission. Certain sections of the Bill have to be notified in draft to the European Commission in accordance with the Technical Standards and Regulations Directive 98/34/EC, as amended by Directive 98/48/ EC. The Directive is intended to assist in avoiding the creation of new technical barriers to trade within the Community. It requires Member States to notify technical regulations to the Commission in draft, and then generally to observe a standstill period of at least three months before adopting the regulation, in order to allow other Member States and the Commission an opportunity to raise concerns about potential barriers to trade.
Almost all parties in Ireland have long been in agreement that the current gambling laws which date back to 1931 do not adequately address online gambling. The Bill is to be welcomed as it introduces significant reforms in terms of creating a proper regulatory and licensing regime for remote bookmakers and remote betting intermediaries. Ireland as a jurisdiction relies heavily on foreign direct investment. It is hoped that by creating a regulatory environment for online gambling operators, it will create significant down stream revenue from investment by major gambling firms in Ireland.
The view the full text of the Bill please click here.