Spanish cabinet approves draft gaming law

The Spanish cabinet has today approved a draft law to regulate all forms of remote gaming, including mobile.

The bill will now go before the country’s Congress on Tuesday, before passing to the Senate and being notified to the European Commission, laying the foundations for a potential legislative framework to be put in place by the end of 2011.

The tax model approved by the Spanish Council of Ministers is however not yet known. Industry associations such as the Remote Gambling Association (RGA) have been lobbying against a turnover tax for sports betting, arguing this would result in an uncompetitive offering to Spanish consumers. The governing Socialist Workers Party is believed to be in favour of a tax on turnover rather than gross profit.

Santiago Asensi, a gaming lawyer with Asensi Abogados in Madrid, said the priorities of the ruling party had potential to hinder the progress of the bill in a format desired by online operators.

“The gaming industry and the opposition People’s Party have been clamouring hard against turnover tax, and gaming groups from all areas of Spain have been pushing hard for a gross profits tax to be implemented .

“The socialists have so far been keen to implement a turnover tax, but there is a chance that they will eventually respond to the pressure. We will only know their response when we hear the official confirmation from the government.”

The European Commission’s forthcoming decision on Danish proposals to tax the online industry at a different rate to the land-based industry also had potential to slow the passage of legislation, according to Asensi.

The European Commission is, however, not expected to receive the draft bill until June or July, at which point the statutory standstill period set aside for review of the proposed legislation will commence. The usual three months is expected to apply in the Spanish case.

It is uncertain whether the system used in the autonomous region of Madrid – where licenses may be issued as soon as operators meet a predetermined set of requirements – will be applied on a national level. Madrid issued authorisations to existing land-based casinos and bingo halls in 2007 for offering online betting, casino and bingo.