A Guide to Jersey for eGaming companies
THE REGULATORY ENVIRONMENT
The Jersey Gambling Commission (Jersey) Law was passed in 2010, leading to the creation of the Jersey Gambling Commission (”JGC”). The JGC participated in the creation of the Gambling (Jersey) Law 2012 which became effective from the 1 January 2013.
This legislation was specifically created to provide flexibility for the JGC to regulate what is a rapidly changing and challenging industry thereby providing an advantage over older, less flexible, legislation in competitor jurisdictions.
The JGC is approachable, flexible and supportive, has a working relationship with the Jersey Financial Services Commission and, perhaps most importantly, is keen to co-operate with prospective operators and other regulatory bodies to ensure the eGaming industry in Jersey has the opportunity to flourish.
Jersey recognises the degree to which local licensing regimes are being introduced throughout the world and that new and existing operators will often consider a new multi-jurisdictional approach to their operations. The JGC has subsequently adapted its costs to more appropriately reflect the costs of licensing for remote gambling activity in this new multi-jurisdictional era.
The licensing regime is straightforward and easy to understand. Jersey has a single B2C licence and/or a single B2B permit designed to capture all commercial gambling activity and ancillary business. A Jersey Remote Gambling Licence is valid for 5 years and is subject to an annual fee.
REQUIREMENT FOR A JERSEY LTD COMPANY
Jersey Companies are subject to a compliance regime under the supervision of the Jersey Financial Services Commission, which requires high standards of corporate governance and high standards on anti-money laundering. The JGC provides further protection of the integrity and reputation of the Island to ensure Jersey presents a top class jurisdiction for eGaming.
Jersey does not have a requirement for staff or specific services to be located in Jersey with the exception of the data centre, an MLRO and a local company to hold the licence. However, it is possible to relocate and base whole or part operations to the Island and assistance is available should this be the case.
INDEPENDENT TESTING This is required but not if already recently undertaken by an approved independent testing house.
The Jersey Gambling Commission (JGC) offers Licences, Permits and Approvals in different categories:
REMOTE GAMBLING OPERATOR’S LICENCE
A Remote Operators Licence is required if you are offering B2C (Business to Customer) gambling from Jersey.
Application Fee £5,000. Remote Gambling Operators Licence Fee £15,000. A further fee of £5000 may be requested if the cost of the application fee exceeds the first tranche.
IMPORTANT NOTE: Remote Gambling Operators (B2C) applications that include any Casino style games must also register with the Jersey Financial Services Commission (JFSC) under the Proceeds of Crime (Supervisory Bodies) (Jersey) Law 2008.
PLATFORM PROVIDERS PERMIT
A Platform Providers Permit is required if you are offering B2B (Business to Business) services (hardware or software) from Jersey.
Application Fee £5,000. Platform Provider’s Permit Fee £10,000. A further fee of £5000 may be requested if the cost of the application fee exceeds the first tranche.
SOFTWARE DESIGNERS PERMIT
Software Designers Permit is required if you are designing gambling software in Jersey. A permit is required even if the games that are created are not released within Jersey for the public to play, but sold or licenced externally.
Application Fee £500. Platform Provider’s Permit Fee £1,250.
HOSTING SERVICE PROVIDERS
A Hosting Service Providers Permit is required if you are providing facilities to host equipment or services utilised in online gambling in Jersey.
Application Fee £500. Remote Gambling Operators Licence Fee £1,000.
APPLYING FOR THE CORRECT LICENCE
Whilst in most cases, it can be relatively easy to understanding which is the correct licence for your operations; before submitting a licence application (together with the application fee) we strongly recommend that you obtain suitable and appropriate advice regarding the type(s) of licence or permit required. Please refer to our ‘Contact Information’ page later in this guide.
- Gaming Duty 0%
- VAT 0%
- Corporation Tax 0%
- Population > 100,000
- Businesses > 7,000
- Financial Services > 40% of GDP
- Employment > 57,000 (25% of which in financial services)
- Currency = £GBP
- Time Zone = GMT
With major financial centres only a short flight away, Jersey puts you at the hub of a world-wide travel network.
Less than an hour’s flight to London, daily flights to international hub airports and easy access to the UK and Europe’s transport networks, Jersey’s strategic location makes travel easy and enjoyable whether you’re taking your family skiing, spending the weekend in the city or visiting business contacts.
Jersey’s airport and private airfield is easy to access, so you can be home within minutes, ready to enjoy the Island’s relaxed pace of life.
Jersey’s close proximity to France - just twenty kilometres away - adds a distinctly European feel to the Island’s ambiance. It’s the perfect setting for the good life, whether you’re hosting clients or just appreciating the Island’s wealth of natural resources.
With a highly respected international reputation and recognised by both the IMF and OECD, Jersey regularly ranks as one of the top offshore finance centres in the world. Jersey’s well-regulated business infrastructure ensures that you will have peace of mind when you move your business to the Island.
Jersey’s long established world-class reputation as an offshore jurisdiction coupled with the flexibility of Jersey law makes us highly attractive to companies and investors seeking the place of incorporation for a holding company.
We are also Bitcoin pioneers; people are using it, businesses are accepting it and the world’s first regulated expert fund is here, all of which means even more options for your business.
Jersey is the leading international finance centre for listing vehicles, proudly being home to:
- Over 110 companies listed on worldwide stock exchanges from London to New York with a combined market capitalisation of over £268bn
- The greatest number of FTSE 100 companies registered outside the UK
- The greatest number of companies registered outside the UK in the IM markets
- One third of all Chinese companies in the AIM markets.
BUSINESS AND TAX
THE BUSINESS ENVIRONMENT
Jersey offers a low tax environment, providing tax certainty and allowing for fiscally efficient cross-border investment, with no tax leakage:
- No Capital Transfer Tax
- No Capital Gains Tax
- No Value Added Tax (“VAT”)
- No Withholding Taxes
- No Stamp Duty on trading company share transfers
- No Wealth Taxes.
Jersey’s position on UK VAT is a key advantage for Jersey over other jurisdictions. No VAT is chargeable on exports to Jersey and such exports can include the provision of professional advice and services to a Jersey entity including the costs of the production of marketing/advertising material in respect of promotions.
Jersey has a visible financial industry in its capital, St. Helier, which employs a quarter of the local workforce. In over five decades, Jersey has developed a breadth and depth to its range of products and services that competing jurisdictions find difficult to match. The wealth of experience and expertise offered by Jersey’s highly skilled financial service providers, combined with a world-class infrastructure, gives an unparalleled welcome to businesses and investors alike.
Jersey has a highly-developed communications network including Island-wide gigabit and 4G connectivity, excellent access to world-renowned professional service providers and a progressive attitude to the establishment of corporate offices. This connectivity is set to place Jersey at the forefront of the global digital ecosystem, generating significant opportunities for eGaming and ecommerce Business.
Jersey maintains a competitive IT marketplace with 4 major telecoms providers and the Island offers a comprehensive and robust business, power and communication infrastructure with 3 Data Centres (ISO27001 and PCI compliant).
These Data Centres can offer Disaster Recovery, Cloud services and DDoS protection, alongside redundant power back up systems providing 24/7/365 service to stringent SLAs. Jersey has in total 42 banks and access to a host of Payment Solution Providers (“PSPs”). Jersey has access to all major accountancy firms and 5 first tier legal practices.
Jersey is the jurisdiction of choice for corporate entities seeking to list – with the greatest number of FTSE 100 companies registered outside of the UK, being registered in Jersey.
CORPORATE SERVICE PROVIDERS
Jersey has access to an established network of third-party service providers with an interest in establishing an integrated solution for new eGaming businesses looking to relocate to the Island. Included in this category are highly experienced corporate service providers, games software testers, compliance resources, data hosting services, merchant services, tax advisers and other support.
Experts based in Jersey are well positioned to assist with establishing eGaming businesses by providing company formation, licencing and regulatory advice as well as assisting on full migrations of existing businesses and IPOs.
Dedicated eGaming legal teams, each with a thorough appreciation of the technical, regulatory and operational issues, are available to support your business strategy.
B2C operators based in Jersey can have their media spend, social strategies, affiliate programmes and reporting managed by industry professionals. Businesses selling services to other worldwide companies can discover the excellent B2B sales knowledge here on the Island of Jersey.
A WELL RESPECTED JURISDICTION
Jersey’s reputation as a leading financial centre with a well-regulated business infrastructure has been repeatedly endorsed by the IMF and the OECD and the Island regularly ranks as one of the top offshore finance centres in the world. As a jurisdiction to base a business, it has a highly respected international reputation.
The Island has a unique constitutional position, is self-governing, with a stable government and independent fiscal and legal systems.
Although its allegiance is to the British Crown, the Island’s domestic autonomy has been preserved via charter and convention through 800 years of history. The Island has its own democratically elected Parliament, the States of Jersey which has responsibility for domestic affairs including fiscal matters. Jersey also operates its own judicial system with roots in the customary law of Normandy, but which has also been subject to numerous influences over the centuries, principally from English law and the law of France.
Jersey’s robust, modern and sophisticated legal framework is the source and foundation of Jersey’s finance industry. Developments and enhancements are continually being made to ensure flexibility and attractiveness to domestic and international markets.
Jersey has carefully reviewed the legislative environment for eGaming in competing jurisdictions and has incorporated the best elements into its local legislation. The Jersey Gambling Commission has autonomy and scope to adapt its licensing regime quickly providing a dynamic environment and enabling operators to take advantage of emerging opportunities quickly.
Part of Jersey’s international eGaming focus is accentuating the IPO and Listing services already in place on the Island. Jersey is currently home to 110 companies listed on the worldwide stock exchanges from London to New York, the greatest number of FTSE 100 companies registered outside the UK, and the greatest number of companies outside the UK that are listed on AIM, including a third of all Chinese companies listed on AIM. In terms of numbers, Jersey is the leading offshore jurisdiction for Listing. This will give companies seeking to list on global stock markets extra advantages, given Jersey’s international reputation as a transparent, rigorously regulated global finance centre. Shares in Jersey incorporated Holding Companies are free of Stamp Duty and free of withholding tax on dividends, interest and royalties.
Jersey is a location for those who want to work in a thriving, international centre of excellence, but who also seek a life beyond the office. In Jersey, the work-life balance really is achievable. As well as offering a fantastic business environment, Jersey delivers an exceptional lifestyle and a safe and secure location for families thanks to its high-class education and health systems, a first-class range of restaurants, including three with Michelin Stars, and an abundance of high quality leisure and sporting facilities on the doorstep. In addition, the ability for people to be home, on the beach or in breath-taking countryside within minutes of leaving the office, is a major bonus.
With a pace of life that gives you and your family space to thrive, Jersey is an environment where people and businesses flourish.
LOOKING TO THE FUTURE
A strong, digitally enabled and diversified economy. The Island’s government supports the development of a strong and diversified economy with an emphasis on economic growth, development and job creation in the Island.
The States of Jersey enables and supports appropriate inward investment into the Island through Locate Jersey (www.locatejersey.com), the government organisation responsible for promoting, attracting and retaining inward investment for Jersey. The States of Jersey also created, developed and grant-funds Jersey Finance Limited (www.jerseyfinance.je) and Digital Jersey Limited (www. digital.je) which are public/private organisations, respectively responsible for the promotion and development of those areas of the economy.
Digital Jersey is the body actively promoting the technological development of the Island and securing new business and industries. Support for new businesses looking to relocate to the Island is also available from the inward investment body for the Island, Locate Jersey, and eGaming is being promoted and supported by an industry-led group called Jersey eGaming. You may contact any of these three for advice, guidance and further information however the first stage of any application should be to contact the Jersey Gambling Commission.
There are app developers and games developers with extensive knowledge of building financial and trading systems.
Jersey is lottery friendly, quietly producing in excess of 160 market leading instants in the past 10 years. Jersey developers have shaped this industry and are at the forefront of mobile and online enablement of lotteries.
Software providers in Jersey have deep experience of working with global leaders in the lottery industry and have led the thinking into exactly how their products should operate. This industry knowledge married with attention to detail and creative flair enables businesses to focus on the fun parts, with the confidence that the products will be well received by players and provide excellent returns for their customers.
IMPORTANT CONTACT INFORMATION
Carey Olsen is a market leading offshore law firm. We employ 360 people including over 200 fee earners.
Our dedicated eGaming legal team has a thorough appreciation of the technical, regulatory and operational issues affecting this flourishing sector. We have been advising clients since the inception of the eGaming industry and we are at the forefront of offshore eGaming law. We are fully conversant with the various licensing and gambling laws and our experts can provide company formation, licensing and regulatory advice as well as assisting on full migrations of existing businesses. We can also provide ongoing support in the future development of client business including general corporate work (where listing work is a speciality), restructuring and representation when encountering litigation.
Marcus Pallot, Partner, Jersey email: [email protected]
T: +44 (0) 1534 888900
JERSEY GAMBLING COMMISSION
Dr Jason Lane, Chief Executive email: [email protected]
Matthew Viney, Technical and Compliance Officer email: [email protected]
T: +44 (0) 1534 828540 +44 (0) 7700 716797
Email: [email protected]
T:+44 (0) 1534 440604
Email: [email protected]
T: +44 (0) 1534 789333
HISTORY OF UK AND EU REGULATION IN RELATION TO eGAMING IN JERSEY
The 1990s saw the creation of a number of regulatory bodies, but a significant development occurred when the UK passed the Gambling Act 2005, leading to the creation of the UK Gambling Commission in 2007. The UK was the first major Western country to create such a Commission to regulate this industry.
Continental Europe has been slower to respond, but partly as a result of the 2008 global financial crisis, EU states have recognised the opportunity to create their own legislation, increase the transparency of and properly regulate the industry. Using this framework, tax authorities have been able to collect revenues from these activities.
Initially, the UK did not impose a gambling tax for non-resident online gambling businesses that advertise and sell their services to UK residents, but rather saw their role in monitoring the jurisdictions, and the businesses in those jurisdictions providing this service. This was achieved through section 331 of the Gambling Act 2005. This provision prohibited any countries outside of the EEA, the UK and Gibraltar from marketing gambling services in the UK, unless the jurisdiction obtained specific approval, after which the jurisdiction was added to a “White List”, which included the Isle of Man and Alderney.
In 2009, some irregularities arose as to one of the existing White List jurisdictions, and Jersey’s pending application for inclusion was suspended. This coincided with a change in the UK Government, and the White List remained closed pending further assessment. As a result of this, and despite efforts on the part of the Jersey government and industry, Jersey was not included on the White List. Hence, no businesses licensed in Jersey would be able to advertise or sell services into the UK, which at the time was the largest regulated market in the world.
As other EU states began to impose gambling taxes, the UK also turned its attention towards how it could realise taxation revenues from the industry. In March 2012, the Offshore Gambling Bill was published proposing a new point of consumption tax of 15% to be effective from 1st December 2014. The Bill received Royal Assent on the 14th May 2014 and became the Gambling (Licensing and Advertising) Act 2014.
The result is that all existing businesses advertising and selling to UK residents must now be registered with the UK Gambling Commission under a Remote Operating Licence and pay a 15% gambling levy.
For Jersey, this has levelled the playing field with competitor jurisdictions, removing the historic disadvantage of non-inclusion on the White List. Consequently Jersey’s already inherently attractive regime for eGaming can now be considered a real alternative as a jurisdiction for delivering an eGaming proposition.