Leading betting company in Malta move at Gibraltar's expense

The Gibraltar government said: "It is clear that the decisions announced by bet365 are directly related to Brexit and not to any matter otherwise related to Gibraltar."

A spokesperson for bet365 said earlier: “As part of our strategic and contingency plans to ensure EU market access and to maintain and enhance operational efficiencies, we have been building our presence in Malta and operating a dual regulatory and licensing strategy between Gibraltar and Malta for a number of years.

"However, from an operational and technical perspective and given our operating model, it has become increasingly challenging to efficiently run such multisite operations and this has necessarily resulted in us conducting a review of our operations.

"We also continue to operate in a highly uncertain environment, driven primarily by the continuing Brexit landscape. Therefore, to assist with business planning and in order to maintain operational effectiveness, we intend to enhance our Maltese operational hub and relocate certain functionality there. We are now consulting with staff in relation to such relocation. It is intended to maintain a presence in Gibraltar and the final rationalisation will be determined after we have completed our staff consultation.”

bet365 adds that they proposes to make no further comment at this stage, particularly whilst the employee consultation process is ongoing, but can confirm it is working closely with all stakeholders.

GOVERNMENT'S RESPONSE

In its response, the Government says it has worked very constructively with bet365 on the issues that have led to the decisions that company has announced today and to mitigate the effects on Gibraltar.

It is clear that the decisions announced by bet365 are directly related to Brexit and not to any matter otherwise related to Gibraltar.

The Government adds that it will continue to work with bet365 through its period of staff consultation and rationalisation in order to seek to ensure that the footprint of bet365 in Gibraltar remains substantial.

"Gibraltar remains the best jurisdiction in the world from which to do well regulated, reputable online gaming business – and is the only jurisdiction guaranteed access to the United Kingdom market in online gaming going forward," said the Government.

Malta move is 'real blow'

Together Gibraltar say they are saddened to hear the news of Bet365's relocation of their Gibraltar offices to Malta.

"While we are pleased staff have been offered employment in Malta, this is a real blow to those who have made their homes on the Rock, as well as to our community and economy as a whole. Bet365 leaving will cost Gibraltar several millions of pounds in PAYE alone per annum, plus corporate tax and indirect expenditure, as well as a few million pounds at least,

in Social Insurance contributions," said Together Gibraltar.

And they went on to say: "Further, the economic supply chain of small and medium local businesses who rely on this large corporate sector of the community are set to take a

massive hit, in turn causing a domino effect on losses on income tax there too. We hope that Government will be addressing this fallout imminently."

This is another clear sign of the damage that Brexit is causing across the UK and we will keep campaigning to make sure Gibraltar remains in the EU. In any scenario, we are committed to working with Parliament to ensure Gibraltar maintains EU market alignment and mitigates further damage to our economy and future prospects, said the party.

ALARMING

And added: "The situation is especially alarming given the Minister for Financial Services and Gaming's comments that Brexit would not have an impact on Gibraltar's Online Gaming sector and Bet365 specifically.

"In May last year Mr. Isola stated that Bet365 "are not leaving Gibraltar by any stretch of the imagination". It is clear that this was not the case, given that it now transpires that talks over the relocation have been happening since a year ago.

"Nevertheless, we hope to work closely with all Members of Parliament to ensure that gaming companies have the regulatory stability they need to succeed in Gibraltar.

"With that being said, we also believe that what has happened is a clear indication of government's failure to diversify Gibraltar's economy. Gibraltar deserves comprehensive economic planning that extends well beyond one party or another's four-year term, to ensure sustainable career opportunities, supporting local enterprises and attracting international business.

"We wish the best of luck to Bet365's employees and will be doing everything we can to support and represent those who decide to stay in Gibraltar."

GSD CONCERNED

The GSD is concerned and disappointed by today’s announcement by Bet365 that they will be relocating operations to Malta. Bet 365 employs around 500 people locally and it is understood that staff have been offered the opportunity to relocate.

GSD Party Spokesperson Orlando Yeats said:

The announcement is a big blow for Bet365 employees and Gibraltar in general, apart from the job losses this announcement will have a knock-on effect on the local economy. Gaming companies generate huge wealth via corporate taxes, rents and utilities, their staff also spend much of their disposable income propping up the local retail and hospitality sectors.

The GSD is concerned that the Government’s aimless strategy of backing Mrs May to the hilt and its inexplicable endorsement of the one-sided Tax Treaty has contributed to the climate of uncertainty. To the extent that if the current uncertainty is the reason for the company moving large parts of its operations to Malta, the Government needs to share the responsibility for that loss to the economy.

A year ago, the Government issued a press release stating that they had a high degree of confidence that there will be positive outcome for Gibraltar companies as the Brexit negotiations progress and that Bet365 were committed to maintaining its workforce in Gibraltar, sadly this has not been the case and year on after the tax treaty announcement the company has decided to relocate.

Bet365’s departure continues a worrying trend of gaming companies relocating operations to jurisdictions such as Malta.

In Government the GSD would be committed to do everything possible to keep gaming companies in Gibraltar as we recognize they are major employers and an integral part of our economy.”

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