Spanish authorities prefer French online betting model

The government has spent years trying to agree with the gaming industry and with the autonomous communities’ regulations to take new legislation forward to regulate online gambling.

However, it is not easy to reach a consensus. In principle, the intention of the Executive was to have a draft bill ready before summer, but it seems rather improbable, especially because the text is still under development and the government continues evaluating other European legal systems to define the main lines of the future Spanish law.

The primary source of inspiration seems to be France. Not surprisingly, this country has a similar situation; in both countries the state regulates the game and at the same time, it is the largest operator -in Spain through Loterías y Apuestas del Estado (LAE). But if the executives opt for copying the French model, it probably won’t have the majority support.

The main reason is paying tax. France establishes a tax on the total amount of betting not over profits. In the case of French model, it is 8.5% tax on each bet. The vast majority of European countries that have already regulated online gambling, as well as the Spanish regions that have legislated sports betting- have chosen to apply tax on profits, which a priori, is more attractive for the operators.

For example, in Madrid or the Basque Country the tax is 10% onf profits. It refers to Victoria or Sportium as other online operators have not yet been installed there.

Depending on the regulation, online gaming companies will evaluate if it will be worthwhile to open subsidiaries in Spain or continue operating online from the countries in which they are licensed.