Wes Himes, founder and managing partner of public affairs consultancy firm Policy Action, speaks to InterGaming about the shaping of i-gaming regulation in Europe and what impact the present economic uncertainty may have on the sector
In all the debate over the future of the eurozone and the political instability created by the economic crisis, is online gaming regulation still high on the agenda?
Yes, it certainly is, to the extent that some countries, like Greece, even expect revenues from online gambling to make a small contribution to their economic recovery. But it would be fair to say that most of the European jurisdictions keep the same level of interest in online gambling mainly because this being a global business they cannot afford to ignore the developments in technology and legislation elsewhere. On top of that, the EU keeps working on online gambling and although most of its initiatives will not probably provide tangible results in the short term, they keep EU countries busy.
Will the survival or collapse of the euro have any influence on the industry? A situation of economic instability is bad for virtually any business but online gambling does not seem to have been hit hard so far. It is probably too premature to predict the collapse of the euro but even if it happened I do not expect massive losses for the industry. People would probably be a bit cautious at the beginning and then adapt to the new situation.
Is there a concerted effort to bring the array of national i-gaming regulatory frameworks in line, or is this an unrealistic aim? The European Commission has repeatedly said that it does not foresee EU legislation at this stage. The Commission, however, is encouraging administrative cooperation between the EU member states. While the main purpose of that cooperation will probably be the enforcement of national laws against operators that do not have a local licence, there is some hope that it will also serve to exchange information about each regulator’s requirements and therefore to reduce duplications. There are other bodies, like GREF, that may try to promote the convergence of technical and consumer protection standards but that is a difficult task when you do not have the supranational powers that the EU has.
What are the benefits of harmonisation for regulators, operators and – last but not least - players? Harmonisation is a no-no for jurisdictions that seek to keep their market closed or very restricted in order to protect a monopoly or incumbent operators. Leaving aside that scenario, harmonisation, if properly done, can be cost efficient for regulators, operators and end consumers: regulators can rely to a certain extent on the checks undertaken in other jurisdictions, operators can avoid unnecessary duplications and customers can benefit from a wide and competitive choice subject to common safeguards.
Do you believe governments will seek to regulate social gaming? If so, what will be the challenges? It is too early to say but if some governments eventually decide to regulate social gaming they are likely to cover only very specific issues, like, for instance, how to protect children and whether someone can trade their virtual chips in a secondary market for cash. In any event, governments will be subject to EU rules and will have less leeway to introduce restrictions than in the case of gambling, provided that the game is not played for the prospect of winning a sum of money or money’s worth.
This feature can be read in full in the July 2012 issue of InterGaming magazine.
