Peter Greenhill, Head of eBusiness at Equiom reflects on ICE 2017, and discusses where the iGaming sector is going and how Equiom slots into it.
“ICE 2017 provided the industry with yet another excellent mass of high-calibre suppliers, new products and operators. Once again the visitors grew in quality and knowledge on the previous year. Another great victory was that the Transport for London train strike, threatening to replicate the problems of 2015, was cancelled just a couple of days before and visitor numbers therefore kept us very busy indeed.
Equiom supported the Manx Government on the Isle of Man eGaming stand. Six of our staff were available at the show answering questions about establishing new companies, obtaining licences, tax and VAT implications as well as promoting the benefits of the Isle of Man as a leading eGaming jurisdiction. Our pure gaming experience and expertise also enabled us to advise companies on a number of other key areas.
Brexit was top of the agenda for many companies and we were involved in quite a number of discussions relating to the possible effects of the UK’s exit from the EU on different countries.
Whilst everyone agrees that it is far too early to have any definitive conclusions on what will happen, it is clear that many of the major gaming companies across several locations are already exploring possible options with their advisers, big four accounting firms and the leading gaming law firms.
Another area of key interest was the need for companies to establish a legislative home for their intellectual property so that licences could be granted from that location as well as the company’s registered jurisdiction. In addition, many countries are in the process of beginning the implementation of ‘BEPS’.
Base erosion and profit shifting refers to tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations. When setting up a company it is therefore vital to avoid this issue by establishing a true office, not a ‘brass plaque’. Key staff need to be employed in that office and key decisions should be made there.
Equiom’s conversations with various gaming companies and intermediaries during ICE concluded that it is clear that the options will depend heavily on the location of the gaming operators’ clients around the world and the size and projected growth of their business.
Amongst the products shown this year at ICE were a number of virtual reality game ideas, although most would agree that this concept will take several years to refine in the gambling market and improve initial concepts before they reach the acceptable level of completion. One very exciting product that seems to be on the cusp of completion is the introduction of 3D Avatar-style concepts which will provide major leaps forward in marketing and effectively drive clients to particular sites. The new technology, which is about to be launched, could effectively change the old affiliate concept that has been under threat recently. In recent months, the UK Gambling Commission launched a wideranging investigation targeting many affiliates associated with the gambling industry. They believe that the gambling sector is one of the worst offenders when it comes to spam and these practices are often associated with affiliates. However, it has been argued that promotion of a gaming brand and traffic which is driven to a gaming website is the responsibility of the gaming operator.
The gaming market is becoming much more mature now and hence we see the number of mergers and acquisitions continuing both in the operator (bookmaker) side and the supplier side including providers of solutions, platforms and gaming content.
Equiom has been attending ICE for many years, since around 2005 at Earls Court before the move to ExCel. This year, Equiom discussed the Isle of Man’s proposition with visitors from many countries including the Czech Republic, Greece, Nigeria, Philippines, Russia, Serbia, Sweden, Switzerland and the USA.
Equiom’s services to the gaming sector covers a number of jurisdictions where we have a staff presence including the Isle of Man, Jersey, Malta, Hong Kong, Philippines and Singapore. Naturally we also work closely with companies which need a UK licence in addition to other jurisdictions.
Clients have chosen our services or moved to us from other corporate service providers based on our ability to work closely with them to provide true gaming consultancy and agree a corporate structure that would work most effectively and efficiently for them. In addition to our gaming and eBusiness services, we provide all areas of support covering property, trusts, tax and VAT, yachting and aviation, corporate services and family office services.
Our approach is to provide and discuss a range of services with potential clients, advising on what they need to consider. As the client relationship progresses over time we then hand back any of those services that are deemed more efficient for the client to manage themselves, creating a true working relationship.