With a no-deal ‘hard’ Brexit becoming more and more likely, Irish retailers in the online gambling industry are wondering how this will affect their business. Ireland is expected to be one of the economies worst affected by a hard Brexit, with some saying even the United Kingdom itself may not suffer as badly.
Businesses across the continent are questioning what changes may need to be put in place in order for them to remain profitable, and the online gambling industry is no different.
According to research from the Irish government, the economy is expected to suffer a two to seven percent decrease in its GDP, depending on the severity of the UK’s withdrawal terms. The assumption is that the “harder” the Brexit, the worse the outcome – due to individual trade agreements becoming more lengthy, complex and expensive.
Sectors expected to be worst hit include food, medicine, retail, travel, and online businesses. However, the unique nature of online gambling makes it particularly difficult to ascertain exactly how bad it will be affected. Some believe it may even benefit from the UK’s departure, although evidence for this is largely unfounded.
A ‘soft’ Brexit would mean existing trade deals could potentially remain in place and the UK would develop a relationship with EU nations similar to the one Norway enjoys. However, in the event of a no-deal Brexit, World Trade Organisation (WTO) rules would come back into place – as they were before the formation of the European Union.
Pros and Cons
Ireland currently benefits from some of the best online gambling regulations in the EU and very favorable taxation policies. As a result, the Irish capital city of Dublin has become a popular spot for U.S. gambling companies to set up operations. However, if Brexit forces new laws into power, this could potentially disrupt the current status quo with negative knock-on effects to customers.
Currently, UK gambling legislation is already separate from EU legislation, requiring all foreign companies to be licensed by the UK Gambling Commission in order to provide services in the UK. For this reason, withdrawal from the EU may not hugely affect the online gambling industry as much as it will some other industries. Its likely online casinos will simply have to reapply for a new license, in which case the only remaining factor that may affect revenue will be a reduction in disposable income amongst customers.
Mark is a freelance writer specializing in fintech, cryptocurrencies and gambling news. He writes for various publications on a wide range of finance and technology related topics and spends his free time traveling the world.