Paddy Power Betfair Plc announced Friday that they would be closing their Gibraltar offices and leaving the tiny British territory on Spain’s southern tip by August this year.
It’s not a big closure. The Betfair Gibraltar office is home to 20 or so staff who will be relocated to offices in Dublin or London after the closure. Still, it has prompted the government to swing into damage control mode and defend Gibraltar’s standing as a leading current, and future remote gambling licensing jurisdiction despite Brexit looming.
Their sensitivity on the whole topic of Brexit effects on Gibraltar is understandable. Online gambling firms employ one in every 10 workers in Gibraltar, and along with the finance industry, counts for 40% of the territory’s GDP. If Gibraltar were to lose their access to the EU single market as a result of Brexit, rendering an online gambling license there about as valuable as the piece of paper it’s written on, the resulting stampede of online gambling firms would be disastrous for the economy.
So, in the wake of Paddy Power Betfair’s very small office re-shuffle, the government felt the need to make a number of strong statements to local media.
First, a clarification that the move was entirely motivated by the recent corporate merger, and not at all by Brexit fears.
“…it has been clear for some time that the Betfair office was under review due to the new Paddy Power Betfair merged company consolidating its estate and operations across Europe since it was formed last year.”
It was also pointed out that other M&A activity and resulting corporate reshuffles have resulted in staff being moved to Gibraltar recently. Kindred’s acquisition of 32Red, Ladbrokes merger with Gala and the GVC takeover of Bwin.Party were all cited as examples of this.
Second, an assurance that there are still plenty of online gambling firms wanting to be licensed in Gibraltar.
“At present four operators licensed elsewhere in Europe are developing their applications to be licensed and located in Gibraltar.”
Third, a promise to do whatever it takes to protect Gibraltar’s position as a leading licensing jurisdiction.
“Whatever Brexit may produce for Gibraltar, Government will adapt its licensing and regulatory arrangements to ensure we remain the premier remote gambling jurisdiction.”