On Friday the Spanish Congress endorsed the country’s the new Gambling Law that establishes a regulatory environment through all remote and interactive channels.

On Friday the Spanish Congress endorsed the country’s the new Gambling Law that establishes a regulatory environment through all remote and interactive channels. This effectively ends the legislative process and the new law will become effective upon its publication in the State Official Bulletin (Boletín Oficial del Estado) in the next few days.

The new law will establish the regulation of gambling activities in Spain for the first time since it was decriminalised in 1977 and allow the development of online gambling with the exception of games developed by and subject to exclusivity such as those performed by the National Lottery (LAE), and Blind Charity Lottery (ONCE).

The process has been fast-tracked by the need for the Spanish Government to open a privatisation process of the national public lottery (LAE) which is expected to IPO and offer 30% stock this summer. The government aims to obtain revenues in the region of €6bn.

In the coming weeks after publication of the new law it is expected the decree laws will be also published. These will set out the requirements, protocols and conditions to enable operators and providers to apply for licenses and go through the approval process. These are expected to be published before the end of June.

Live in-play betting and bingo have not been allowed. During the legislative process it was defined and excluded for having dangerous addictive effects.

This clashes with the existing retail sports betting and land based bingo regulations established by different autonomous regions where both live betting and classic card and electronic bingo are allowed and operated legally.

Live betting accounts for around 50% of the existing retail sports betting in more than 400 sports betting corners and more than 1500 sports betting terminals; while bingo is a very popular game here played in more than 400 bingo halls throughout the country.

It has yet to be seen how offshore companies will comply with the new law. Operators such as Bwin, Betfair, Bet365, Unibet and a large number of online gaming operators that have been doing business in Spain for many years will have to settle and pay the relevant taxes for the five-year period prior to the new law.

The taxation for online gambling,  (set at 25% of GGR/GPT), will also be a hurdle to profitability in a very competitive market with the majority of large operators having already built a considerable player database (estimated to be more than 400, 000 players)  after years of tax-free advertising and sponsorship. These firms will have a great advantage when they begin to operate in a newly regulated market compared to newcomers that will have to start from scratch subject to the new advertising, sponsorship and taxation rules.

We will have time to analyse the projection and scope of the new legislation in depth as soon as the decree laws are published. This will give us the full picture and will allow us to have a complete view of the situation and the future business environment in Spain.

Posted in: new law will establish the regulation of gambling activities in Spain for the first time since it was decriminalised in 1977 and allow the development of online gambling