UIGEA Online Gambling Ban Creates Opportunity says Irish Gov't Study

An Irish government committee set up in 2006 to review how to improve regulation of gaming and casinos, which would apply to both live and online poker games, has stated that Ireland could benefit from the restrictions the United States placed on Internet gambling with passage of the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA), if the right reforms and legislation were made.

The committee noted that as a consequence of UIGEA, many gaming operators were looking to relocate to Europe.

"The recent United States prohibition of payment mechanisms for gambling online, presents a window of opportunity for Ireland," the country's Casino Committee said on Thursday.

Ireland's economic success over the last decade has been driven, in part, by its ability to attract investment by foreign firms. For example, Google and Yahoo have set up European headquarters in Dublin, as well as gaming software and processing system developer Cryptologic.

Ireland's low corporate tax rate of 12.5 percent has been another key factor in its ability to attract foreign investors. The committee also proposed discussion with Finance Minister Brian Lenihan regarding "possible competitive taxation rates."

"Should this opportunity be grasped within the appropriate timescale, Ireland, as a gaming friendly centre of excellence, can reasonably expect to attract a reasonable portion of this dynamic industry," the report said.

However, the committee did suggest that Internet gambling should be strictly regulated to protect minors and the vulnerable, prevent criminals from entering the market, and ensure the trust of e-gambling customers. It did say that blocking Internet gaming along the lines of the U.S. ban presented numerous difficulties.

CURRENT RULES ARE PRIMITIVE

In relation to brick and mortar casinos, which are now illegal in Ireland, the report found over 30 establishments were providing games such as blackjack and poker by operating as private members clubs. The legislation governing gambling dates back to 1956, and are primitive, according to the report.

The current regime had created a "patchwork quilt of licensed funfairs and amusement halls" that bore no relation to public demand and was economically inefficient, it found.

Should the government decide to legalize gambling, the committee stresses that it be done with respect for European Union laws and in compliance with international guidelines concerning money laundering. The report recommended enacting a "restrictive licensing regime." It added, if casinos were legalized, they should pay a higher rate of tax than the 1 percent of turnover currently applied to bookmakers.

The committee also recommended that (casino-style) gaming and betting on activities such as sports should kept separated.

"There should be no betting of any kind permitted on or in any licensed gaming premises," the report said. "Likewise, there should be no gaming activity of any kind permitted on or in any betting or bookmakers' premises."

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