Wednesday, December 4, 2019
By Andrew Tottenham
Managing Director, Tottenham & Co

The UK Gambling Commission (UKGC) has published its biannual report on the gambling industry in Great Britain. In the year which ended 31 March 2019, it’s been a bit of a mixed bag, with some sectors of the industry seeing growth, albeit fairly anaemic, and others seeing declines in revenue. Land-based casinos were the sector that was hardest hit, with year-on-year revenues declining from £1.18 billion to £1.06 billion, a decrease of over 10 percent.

The fall in land-based casino revenues is primarily due to the severe plunge in the number of customers, mainly Asian, in the high-end London casinos which cater to international VIPs. During the reported period, GGR for London casinos fell from £243 million to £167 million. One casino, Les Ambassadeurs, accounted for almost 90 percent of this drop. The rest of London’s non-VIP casinos saw a 13 percent decline in GGR during the year being reported.

Les Ambassadeurs had been very successful in attracting VIP customers, in part because of its willingness to accept very high betting limits on table games. The casino has approximately 60 percent of the high-end London market and almost 12 percent of the total British casino market. When Les Ambassadeurs sneezes, the high end London casino market catches a cold (with apologies to Metternich).

The Euro News Revue
by Hannah Gannagé-Stewart and Andrew Tottenham
G3 Newswire - 2 December 2019
Olympic Entertainment Group (OEG), Eastern Europe’s largest gambling operator, which is owned by private equity firm Novalpino, will close nine betting shops and two casino arcades in Latvia. That’s in response to a rise in gambling taxes: land-based casinos and arcades saw a 20 percent increase in taxes, to 18 percent of GGR.

OEG has held approximately 30% of the land-based market in the country, operating 9 casinos and 8 arcades along with numerous betting shops, most located in their casinos and arcades. Total GGR for the Latvian market in 2018 was approximately €290 million. The first nine months of 2019 was up 12 percent, comfortably ahead of last year. (AT)
Casino News - 2 December 2019
Hard Rock International can’t catch a break. Their BCN World project in Cataluña is bogged down in planning and ownership problems along with the volatile politics of a region of Spain that is seeking independence. So, a year later, having paid a substantial deposit, they are not much further forward. Now it appears that the award of the license for the Hellinikon project in Athens, which was due to be announced at the end of November, is likely to be delayed by up to six months. Both bidders, Hard Rock and Mohegan Sun, appear to be ready to sue the Government in the event they are not selected. What has caused this mess? One of the bids, possibly Mohegan Sun’s, was not compliant, because the financial guarantee submitted as part of a bid was four days short of the required length. Whatever the decision, it looks like a messy court case will follow. (AT)
European Gaming - 29 November 2019
Peter Hannibal, CEO of the Gambling Business Group, has urged the industry to prepare for a regulatory overhaul in the UK, as the country prepares to go to the polls on 12 December. He suggested operators “look upon this as an opportunity to re-set the narrative around gambling in the UK”. His comments follow the Conservative manifesto labelling the existing legislation “an analogue law in a digital age”. Hannibal also addressed the controversy around loot boxes: “We must make the distinction between gambling and gaming. Gambling licence fees should not be used for the regulation and policing of the ‘gaming industry’. Loot boxes are not a product of our making,” he said. (HGS)
iGaming Business - 28 November 2019
A joint report by the Dutch regulator Kansspelautoriteit (KSA) and self-help organisation AGOG has concluded that gaming machines enhance the risk of problem gambling behaviour. The study was conducted with 86 of AGOG’s 223 members, a less-than-perfect sample but one that the regulator was happy to draw conclusions from. Of the heavily male-skewing (93%) sample, 67% said they used gambling machines. Almost half of the problem gamblers that took part in the survey also said they spent more than €1,000 each month on gambling.

The latest timetable for the launch of the regulated market in the Netherlands points to a 1 July 2021 start, half a year later than originally expected. (HGS)
SBC News - 27 November 2019
The Irish government has further reduced maximum pay-out proposals for gaming terminals. After its initial suggestion in March of a €750 cap on pay-outs, it has now proposed €500. A limit of €5 has been in place in the country since 1956, which a government spokesperson dubbed “archaic, unpractical, and unimplementable” in modern times. The country’s justice minister, Charlie Flanagan, has put forward a number of amendments to proposed legislation, which, alongside modernising the maximum stakes and pay-outs, also would change the minimum age it is legal to gamble, raising it from 16 to 18. Ireland's national parliament, the Oireachtas, is reviewing the proposed gambling legislation, with a keen eye on mitigating problem gambling. (HGS)
SBC News - 27 November 2019
Emphasizing the digital economy in its election manifesto, the Scottish National Party (SNP) has called for a new ‘online regulator’ to protect young internet users, with the power to “take action such as imposing heavy fines and blocking access to sites”. Like the Conservatives, the SNP has backed tightened regulations around loot boxes, but the Scottish ruling party would also like to place a levy on technology companies to fund the new regulator and public awareness campaigns. Unsurprisingly, the party would like to see greater devolution of gambling regulations, shifting those from the central UK government to the government of Scotland, where it believes problem gambling should be treated as a public health issue. (HGS)
iGaming Business - 27 November 2019
Operators Mr Green, owned by William Hill since March, and Karl Casino, a brand operated by L&L Europe Ltd, have been rapped by the Swedish Consumer Agency (KO) after actively marketing to self-excluded players. The KO has ordered both operators to end all communication with players who have signed up to the country’s self-exclusion system Spelpaus, threatening a fine of SEK2m (£162,053) if they do contact any self-excluded players. Both operators have claimed the communications were sent in error. Given the relatively strict regime in Sweden, the pair are lucky to have escaped a fine, so far. (HGS)
Gambling Insider - 27 November 2019
The Guardian - 10 November 2019
Online operators are coming under criticism for their VIP programs, which are seen as encouraging people to bet more than they can afford, rather than rewarding people for their business. This criticism in some cases is well placed, with operators inducing players to increase their bets or spend more time gambling. Loyalty schemes should be about just that, encouraging customers to be loyal to one particular brand as opposed to gambling with many different operators.

By way of analogy, the nature of my business means I fly a great deal and probably have a carbon footprint the size of Manhattan. Being a OneWorld loyalty program member doesn’t make me fly more, it just means that where possible, I select one of the airlines that belongs to the OneWorld scheme. (AT)
This report is edited by Andrew Tottenham and Justin Martin
Tottenham & Co
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