Portugal Struggles With Unlicensed Operators
A joint investigation by the Remote Gambling Association and Eurogroup Consulting has found that almost 70% of Portuguese gamblers online play at unregulated sites. This after Portugal legalized online gambling in its current regulatory from in 2015.
The RGA is a world renowned trade organization dedicated to the online gambling industry and they have been harsh critics of Portugal’s regulatory practices since the country first adopted their gaming laws.
While Portugal did open up the market for international operators, the biggest issue raised was the fact that sports betting operators where taxed based on a percentage of their turnover. Other jurisdictions will tax the industry either a fixed sum each year or by their gross gambling revenue.
This has, rather than ensure regular and sizable tax contributions, driven the growth of unlicensed operators who wish to avoid paying high taxes. 30% of online gamblers in the country exclusively play on unlicensed sites. A review of the current regulatory regime would only be started at the earliest on May next year so for now it seems the industry will remain in schism.
The Legal Gambling Year In Revue
In September the country issued their 11th licensed casino operator license to Nossa Aposta. The first year of legal licensing went quite smoothly and there was a constant revenue increase for the industry but this recent report shows just how ineffective regulation has been. Regulation should not just be aimed at controlling a certain industry, it should also play a large role in providing incentives for that industry to grow, flourish and constantly improve.
People will always want to gamble so it is the duty of the government to put regulation in place that helps and supports gamblers rather than punishing operators for providing the service in the first place.
Portugal has been a perfect example of regulation not just overstepping its bounds but actually hurting the industry in a manner that debatably cannot be salvaged now since unlicensed operators have gained such a foothold with people. Unlicensed operators have already started becoming the norm now.
That said, it is not all doom and gloom as it has only been the industry’s first two years. There is still time and opportunity for the government to rethink its strategy and step up to the plate to reinvigorate the industry. If unlicensed operators remain active it could lead to the public image of online gaming suffering irreparable damage if many of these operators turn out to be less than reputable.
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