888 considering post-Brexit Malta move2017-05-04 14:30:00
Following the controversial ‘Brexit’ vote the future of Gibraltar, a British overseas territory, remains unclear. British PM Theresa May has pledged to do all in her power to protect the island following Britain’s departure from the European Union. With a strong British gambling hub in Gibraltar, any post-Brexit fallout could have catastrophic consequences on Gibraltar’s economy.
888 Holdings Annual Report
In its annual report, 888 underlined its intent on remaining in Gibraltar but failed to rule out a move to Malta where it can avail of the free market. The report stated: “The proposed status of Gibraltar in relation to the United Kingdom as a result of ‘Brexit’ is at present unclear. If 888 were to remain registered, licensed and operating in Gibraltar in these circumstances, its ability to rely on EU freedom of services/establishment principles in supplying its services within the EU will be limited.”
Indeed, 888’s reliance on EU principles for its regulatory strategy may prove a major stumbling block, with the company unable to control political changes of this kind. 888 fears its Remote Gambling License, issued in Gibraltar, may not be accepted by EU bodies. The report continued: “However it would reconsider the appropriateness of remaining registered, licenced and operational in Gibraltar in these circumstances. Malta may be considered as an alternative ‘dot com’ licensing jurisdiction.”
Impressive 2016 Figures for 888
The dark shadow of ‘Brexit’ comes at an inopportune time for 888, who recorded impressive financial growth last year. Revenue increased 13% year-on-year to $520.8 million, with 888 Casino responsible for the majority of said revenue. Casino revenue increased 21% to $279.3 million. Adjusted earnings before interest, tax, depreciation and amortisation also increased by 12% to $90.2 million, with the company overseeing further expansion in the UK, Spain and Italy.
What Does The Future Hold?
888’s dilemma is one that will be shared by various companies, with Gibraltar home to some of the largest sports betting and e-gaming firms. BetVictor, Bet365 and NetEnt are just some of those and the region is viewed as a hub for the gambling industry. Given that 94% of Gibraltar residents voted to remain with the UK in the ‘Brexit’ vote, independence or shared sovereignty is not a possibility. In addition, it seems likely that the Spanish will close their border with Gibraltar which will have a profound impact on the area. Many workers commute across the border freely at present, and hostilities between the Spanish and UK governments will not help matters.
888’s understandable concerns about the post-Brexit climate have been quashed by financial service companies KPM and GVC. Initial encouragement from the ‘Brexit’ move by UK firms may well prove ill-founded as the huge impact of the vote takes full effect. Given Malta’s favourable tax regime and EU status, as well as English, being the main language, we may well see 888 and similar firms move HQ sooner rather than later.