Put simply, if we don’t regulate we won’t be able to open new markets, let alone continue to operate in some of the existing ones. Problem gambling and money laundering worries are the hottest topics, globally, for the industry and if the eGaming industry doesn’t address them then it will be relegated to operating in the shadows, at best.
So what's the answer? In the offshore world it appears very clear that success without effective regulation is not achievable and that the eGaming industry needs proper offshore regulation now more than ever. Operators need stability and confidence that the jurisdiction where they are based has substance and is in it for the long term.
Jersey's key selling point is that it can readily deal with the challenges being thrown up to all eGaming operators. Over and above our competitor jurisdictions, Jersey already has a long established robust regulatory framework that underpins all of the island's success as an offshore financial services centre. This regulatory focus has been transferred over to our eGaming proposition.
Jersey takes the view that light touch, superficial regulation is short-sighted and that whilst it may appear initially attractive, in fact it will only lead to significant problems down the line and is therefore not the route for Jersey. We take regulation seriously and regard that as at the top of our list of selling points. Jersey is actively seeking serious and credible new entrants to the eGaming industry in the island. For more than 50 years, Jersey’s business focus has been to differentiate ourselves from our competitors by ensuring that corporate governance and compliance to the highest worldwide standards are at the fore. More recently this has translated into the fight against financial crime and money laundering where Jersey is fully aligned with the third anti-money laundering EU Directive. For companies operating casino style services and/or for those who administer third parties' funds, the Jersey Financial Services Commission (JFSC) acts as the supervisory body to ensure equally high standards both of corporate governance and anti-money laundering compliance are achieved.
Jersey gives eGaming operators the most robust response to the toughest questions by keeping Jersey entities at the forefront of gambling and AML/CTF regulatory compliance with tax efficient corporate structures that stand up to scrutiny.
Leading Financial Centre
Most people will be aware of Jersey’s reputation as a leading financial centre. The Island, just a few miles from the French coast, has been repeatedly endorsed by international bodies including the International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD) and the European Union (EU). Most recently, MONEYVAL concluded that Jersey was in the top tier of jurisdictions assessed under their criteria.
The Island has a unique constitutional position, is self-governing, with a stable government and independent fiscal and legal systems.
Although its allegiance is to the British Crown, the Island’s domestic autonomy has been preserved via charter and convention through 800 years of history.
Jersey’s robust, modern and sophisticated legal framework is the foundation of Jersey’s finance industry and developments are continually being made to ensure it remains attractive to domestic and international markets.
What this means for eGaming companies
For the eGaming sector it means that Jersey is at the forefront of both gambling regulation and legitimate offshore structuring. Companies which are seeking secondary licensing can be confident in Jersey's compliance status and standards. Jersey based operators can set the standards for operating in third markets where local regulations do not exist (provided that complies with or is in excess of the Jersey regime) and Jersey provides an additional layer of assurance to local regulators, third party software suppliers, banks and payment partners. The Jersey licence is also a selling point when selling to regulators or potential partners in new markets.
Jersey’s tax-neutral environment provides financial certainty as there is:
No Gaming Duty
No Capital Transfer Tax
No Capital Gains Tax
No Value Added Tax (VAT)
No Withholding Taxes
No Stamp duty on trading company share transfers
No Wealth Taxes.
As a base for business, Jersey has a reputation that is second to none.
Jersey Gambling Commission
Jersey has its own independent Regulator, the Jersey Gambling Commission (JGC). The legal framework consists of the local gambling law supplemented by a series of regulations which, whilst robust, permit flexibility. The JGC is a pro-active and approachable regulator which has an excellent relationship with all members of the Jersey eGaming group.
The licensing regime is straightforward too. Jersey has a single B-2-C licence (£15,000) and/or a single B-2-B licence (£10,000) designed to capture all commercial gambling activity and which permits ancillary business. Whilst independent games and technology testing is a licence requirement, the JGC will recognise testing certification recently approved, by approved independent testing houses.
Data Centres, Cloud Services, Lottery
Jersey offers a comprehensive and robust business, power and communication infrastructure. It has 3 world-class data centres, with provisions for disaster recovery, cloud services and comprehensive DDoS protection. It benefits from a host of banks, Payment Service Providers (“PSPs”), all major accountancy firms and first tier legal practices.
Jersey eGaming benefits from a number of app developers and games developers with extensive knowledge of building financial and trading systems.
Jersey is also active in the lottery sector, quietly producing in excess of 160 market leading instants in the past 10 years. Jersey developers have shaped this industry and are at the forefront of mobile and online enablement of lotteries. Software providers in Jersey have extensive experience of working with global leaders in the lottery industry and have led the thinking into how their products should operate.
Another key aspect of Jersey's offering to all new entrants is its expertise in providing all the necessary services for IPO and Listing work, where we are the leading offshore jurisdiction. Jersey is currently home to over 110 companies listed on the worldwide stock exchanges from London to New York, the greatest number of FTSE 100 companies registered outside the UK, and the greatest number of companies outside the UK that are listed on AIM, including a third of all Chinese companies listed on AIM.
Jersey does not require staff or specific services to be located on Island, with the exception of some data hosting and a locally incorporated company to hold the licence. The government has dedicated teams who will provide assistance to operators wishing to establish part of their operations on Island.
For the modern remote gambling operator, Jersey’s reputation for sound regulation cannot be equalled and the jurisdiction has become a very real and competitive alternative for the modern remote gambling operator.
Visit the Jersey eGaming stand N8-249 at ICE 6-8 February 2018 or contact: firstname.lastname@example.org
Marcus Pallot, Jersey partner at Carey Olsen offshore law specialists
email@example.com T +44(0)1534 822247