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Dependencies


FOCUS ON Crown


A WINNING SYSTEM


GARY HEPBURN IS DIRECTOR OF FIRST NAMES GROUP IN THE ISLE OF MAN


OVER THE PAST SIX YEARS the Isle of Man has experienced an unprecedented expansion in the e-gaming sector, to the extent that online gambling now accounts for around 10 per cent of the island’s GDP, making it the second-highest contributor, behind the fi nancial services sector. The Manx government has attracted global organisations by creating a working environment that encourages e-gaming, providing the right framework of legislation and regulation. This, aligned with an advanced infrastructure, including high-speed internet and the right level of professional support, has helped in this success story.


A vital aspect of e-gaming is ensuring that players’ funds are protected, and, indeed, gaming


Gary Hepburn explains the innovative use of Manx trusts to assist with player protection in the e-gaming sector


regulators outside the island also have a primary interest in this. The provision of online gambling in the Isle of Man is governed by the Online Gambling Regulations Act 2001 (the Act) and is regulated by the Gaming Supervision Commission. Of player protection, s6(2) of the Act states: ‘(2) The conditions of a licence shall include conditions requiring the holder of the licence:


(a) To provide such security (real or personal or both), and to maintain such deposits and reserves, as are specifi ed in or determined in accordance with the licence for the payment of debts arising out of online gambling conducted by him.’


Clearly, it is imperative to ensure that players are properly protected to keep their confi dence high. Before a licence is issued to an e-gaming company (whether it is already established and moving from another jurisdiction or is a completely new startup), the company will need to have a player protection mechanism in place.


Player protection trust Isle of Man trusts have been used for many years for various purposes, including estate planning and asset protection, and have been tried and tested in the legal arena. Now, these vehicles are being used in innovative ways to create a structure that provides player protection in the online gaming industry. Not only does a player protection trust off er the segregation of player deposits from the gaming company’s own funds, it also ensures that an independent party controls those funds. The trust works by providing


players with the guarantee that their deposits are secured independently, while also benefi ting the e-gaming company by allowing the company to focus on running its business without operational restrictions that could aff ect profi tability or


WWW.STEPJOURNAL.ORG APRIL 2013 61


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