Brexit uncertainty for businesses
Prominent online gambling operator Bet365 is set to move most of its operations to Malta from Gibraltar. It hopes the move will help the company avoid many of the potential issues that will arise with the finalization of Brexit.
The company has its headquarters in Stoke-on-Trent, but a large portion of its operations was in the British territory of Gibraltar, which has been a hub for gambling operators in recent times. Bet365 has held a gambling license in Malta since 2015, which makes it an ideal destination for the move.
Brexit has caused a huge amount of uncertainty for businesses that have a presence in the UK or work closely with the country. Many companies are withdrawing their operations from the UK or British territories due to this uncertainty.
If Brexit eventually comes to fruition, these companies will look elsewhere in order to gain or retain access to the open European market. Nearby countries in Europe will benefit from this.
Reasoning behind the move
Bet365 made a statement on its move. It said: “As part of our strategic and contingency plans to ensure EU market access and to maintain and enhance operational efficiencies, we have been building our presence in Malta and operating a dual regulatory and licensing strategy between Gibraltar and Malta for a number of years.
“However, from an operational and technical perspective and given our operating model, it has become increasingly challenging to efficiently run such multi-site operations and this has necessarily resulted in us conducting a review of our operations.
“We also continue to operate in a highly uncertain environment, driven primarily by the continuing Brexit landscape. Therefore, to assist with business planning and in order to maintain operational effectiveness, we intend to enhance our Maltese operational hub and relocate certain functionality there.”
The government in Gibraltar responded to the statement, saying it was working constructively with Bet365 on this issue. It said the issue is not with Gibraltar itself, the impact of Brexit. As many as 500 staff could relocate to Malta as a result of the move.
Expansion in the US
While Brexit is causing a lot of uncertainty for Bet365, it is still looking at other ways in which to expand. One of the options it is looking at is the burgeoning US gambling market and has already made an initial move.
The company now has a physical presence in New Jersey after signing a long-term lease on an office unit that has almost 19,000 square foot of space. The office about 50 miles from Atlantic City, the main hub for gambling in the state.
Bet365 already has a partnership in place that will allow it to launch an online gambling platform in the state. Its project partner is the Hard Rock Hotel and Casino in Atlantic City. Initially, the platform will only be for sports betting, and no launch date has been outlined as of yet.
There is also an agreement in place with Empire Resorts, which operates the Resorts World Catskills Casino resort in New York. If online sports betting gets the green light in New York, this will allow Bet365 to be able to open up a platform in the state. This would be an ideal way for Bet365 to start to establish itself as a force in the US sports betting market.
At the moment, other European gambling companies such as William Hill and Paddy Power (through its majority stake in FanDuel) have been the overseas operators making great strides in the US market.