This article originally appeared on the Lexology web site.
Voisin www.voisinlaw.com, by Dexter Flynn, Jersey, July 12 2011
The Jersey economy has finally moved into the 21st Century by accepting that the Island must be part of the e-gaming community.
According to a report from accountants KPMG, the online gaming industry contributed £7 million to Guernsey’s economy in 2007. This had increased to £50 million by 2009. Jersey, with all its attendant offshore facilities and expertise, should have been a world leader in this sector. With the introduction of the Gambling (Remote Disaster Recovery) (Amendment) (Jersey) Regulations 2011 (“Regulations”) on 17 March 2011, Jersey signalled its intention to make up for lost time.
The Jersey Minister for Economic Development, when proposing the Regulations, commented that their primary objective was to maintain Jersey’s reputation as a well-regulated jurisdiction while providing freedom for licensed e-gaming operators to locate their internet facilities in Jersey. The Minister commented that gambling businesses in Jersey would be required to adhere to three vital principles. The first is that gambling should be regulated in accordance with international standards. Secondly, that gambling should be fair to consumers of those services. Thirdly, that gambling should be conducted responsibly with the safeguards necessary to protect children and vulnerable people.
Under the Regulations, a Jersey person (defined to include a Jersey company and/or partnership) can apply for a licence to operate remote gambling services in Jersey. There will be two types of licence: (a) a general remote operator’s licence and; (b) a disaster recovery operator’s licence.
The general remote operator’s licence is a full licence granted to a Jersey person to undertake remote gambling in or from within Jersey. The disaster recovery operator’s licence will apply to those companies who had employed the old regulations to place their disaster recovery/backup systems in Jersey.
Jersey has its own gambling commission which was established pursuant to the Gambling Commission (Jersey) Law 2010. The Jersey Gambling Commission (“JGC”) will be responsible for the implementation of the codes of practice which will govern the Regulations. It will be the JGC that issues the licences. Having met members of the JGC, I have no doubt that we have an experienced and knowledgeable body who will ensure the swift and effective processing of applications.
The fee for a full gambling licence will be based on net profit tariffs. The initial licence fee (paid by all successful applicants) will be £35,000 regardless of size. There will be three bands of levy, the highest being £140,000 where profits equal or exceed £6.5 million.
Jersey is serious about this. Our politicians are currently engaged in talks with UK Government representatives to ensure that Jersey is placed on the list of safe gambling jurisdictions. There is even talk of a temporary licence being granted to Jersey while the UK reviews its own gaming laws.
It is clear that Jersey is finally open for e-gaming business. Voisin is at the forefront of this economic revolution, already dealing with one of the first applications for a licence.