Spain is on the verge of becoming the next major jurisdiction to regulate its online gambling market as licences are expected to be issued to private operators before the end of this year. As seen Greece, one of the key catalysts for reform is the desperate need to raise revenue within the autonomous communities and to generate employment opportunities – Spain has the highest unemployment rate in Europe, at an astonishing 20.7 per cent.
The newly regulated Spanish market is likely to experience similar levels of growth as seen following regulation of first the Italian and then French online markets. The Spanish Association of Internet Bettors (AEDAPI) estimates that Gross Gaming Revenues (GGR) from online gambling is estimated to increase by some 25 per cent in 2011 to reach approximately €400 million GGR and a further 50 per cent growth next year to approximately €600 million GGR. The total online market may generate over €3 billion in turnover by late 2012, once national online licences are in place.
Even before the financial crisis struck there were plans to regulate the industry at national level. In 2007, the Spanish Parliament issued the Information Society Impulse Law (LISI) which set the legislative wheels in motion outlining six principles that would govern any future online regulatory framework. A full three years then passed before a draft bill was
standinG on the BRink the ReGulated
As Spain and Italy cause concerns over debt crisis levels in the euro-zone, it’s imperative that Spain adopts a practical and workable solution for its online gaming industry across all the autonomous regions.
spanish maRket is expected to
GeneRate €438m in GRoss GamBlinG yield foR 2012,
RisinG to €641Bn a yeaR By 2015.
finally introduced by the government, in September last year. During the past year, the draft was sent to numerous parliamentary groups and the autonomous communities for debate. The main sticking points surrounded the proposed high taxation levels, including proposals to tax most games based on betting turnover, rather than the more acceptable GGR model. Further controversy emerged as to whether the definition of lotteries encompassed bingo games, especially since the Spanish monopolies would arguably have then had the exclusive right to offer bingo in addition to their existing lottery monopoly.
The draft was notified to the European Commission in February, and its three-month ‘standstill’ period expired in late May. Although that was extended by a month due to
Malta having predictably issued a ‘detailed opinion’ claiming that some of the current proposals were contrary to European law. Meanwhile, on May 29, after over 200 amendments, the Spanish Congress applied its ‘emergency procedure’ mechanism and quickly approved the draft. It is now known officially as Law 13/2011.
The licence application process is expected to open in November 22, two days after national elections, with licences to be approved in December and ‘first-round’ licensees will operate from January next year.
According to Alber Augustinoy, a senior local lawyer in the firm Cuatrecasas, the Spanish model draws inspiration from existing principles in the UK, Italian and French regimes. The main aim of the law is to “establish a national approach for the regulation of online games and harmonise the existing communitarian regulations regarding online gambling and control activities that overlap with control of the autonomous communities”. Under the law, ‘gambling’ is defined as, “anything with a random element involved, even in games of skill”.
Under Spanish constitutional law, powers to regulate gaming are distributed between the national and regional governments. Any gaming activity beyond the borders of the region would fall under the jurisdiction of the national government. Local licences are
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