Florida’s legal betting short story, and Ireland to heavily restrict bookmaker advertising!

A new post from 4H and Legalbet

Republic of Ireland

Paddy Power external linkExternal links are prohibited their partnership with the Irish broadcaster RTÉ. There will be no more of the bookmaker’s ads during the live broadcast of football games. There is a reason for such a decision. Starting from January 1st, a new voluntary code of conduct will be applied in the country. All members of the Irish Bookmakers Association (IBA) intend to follow it. One of the main features imposes a whistle-to-whistle ban on betting advertisements.

Paddy Power once already decided not to broadcast their ads on whistle-to-whistle basis during EURO 2020. The bookmaker will no longer serve as a partner for RTÉ coverage of the 2021/2022 international men’s football matches.

However the Republic of Ireland national team has already failed to qualify to the 2022 FIFA World Cup in Qatar. Thus the partnership had little meaningful sense anyway.

Ivan Kurochkin’s comments

Paddy Power’s decision to end their partnership with the Irish broadcaster RTÉ may have come directly as a result of the upcoming review of the gambling regulations in the country, which are long time overdue, but for Paddy Power, this isn’t the first time that they have walked away from the lucrative opportunities to have their brand name featured during the broadcast of the games — either on TV or on the teams’ shirts.

In 2019 in England, Paddy Power launched their “Save Our Shirt” campaign to raise awareness over sponsorships on football shirts. For the 2019/20 season, half of all teams in England’s top two divisions were sponsored by bookmakers. PaddyPower paid money to sponsor the club shirts and then requested that instead of their logo the shirt was left blank! Since then, more clubs have chosen to turn away from placing a sports betting brand on their football shirts and prefer highlighting brands from other industries.

When it comes to the Republic of Ireland, whose football league is much less popular than the English one, the motivation behind refusing to sponsor TV broadcasts or have the brand’s logo on the football shirt, may be simply to optimize the marketing expenses and Paddy Power being the frontrunner of such initiatives, actually earns the company way more PR points than the traditional marketing endeavours like sponsoring the broadcasts or football shirts.

With the Irish gambling regulations overhaul underway, it looks like Paddy Power may have chosen to be proactive and be among the first and the most compliant betting operator in the country after the new regulations come into force.

USA

A District of Columbia judge external linkExternal links are prohibited that the Seminole Tribe of Florida’s contract with the state violates the Indian Gaming Regulatory Act (IGRA) and invalidated the agreement. The Seminole tribe owns the Hard Rock brand and the Seminole Hard Rock casino. The tribe came to an agreement with the Florida state government and was to take online bets. Governor Ron DeSantis signed it into law in May. The contract granted the Seminole tribe exclusive rights to online and in-person sports betting in Florida. They were also allowed to roll out roulette and craps to their land-based properties.

It was estimated to generate returns of at least $2.5bn for the state over five years, and at least $6bn by 2030. However, the other casino operators West Flagler Associates and Bonita-Fort Myers Corporation didn’t think that exclusive rights granted to the Seminole tribe were fair. They challenged the contract in the District of Columbia District Court.

Sports betting in Florida launched on November 1st. The judge added that the judgement did not preclude the tribe or the state legislature from pursuing other paths to legal online sports betting. This could take the form of a renegotiated compact where online betting was restricted to Indian lands, Friedrich explained, or through a statewide referendum.

Ivan Kurochkin’s comments

In 1988, the United States Congress passed The Indian Gaming Regulatory Act (IGRA) allowing tribes to establish casino gambling on tribal land and permitted states to form contracts with tribes to regulate gaming. The IGRA requires that any gaming activities provided for through gaming contracts between Indian tribes and state governments occur only on Indian lands, defined as “all lands within the limits of any Indian reservation”.

In 2021, following the nation-wide trend in gambling and betting legalization, the State of Florida formed a new contract with the Seminole Tribe, who own and operate the Seminole Hard Rock Hotel & Casino in Tampa, this time allowing the Tribe to accept wagers on sports.

The new contract between the Seminole Tribe and the State of Florida angered the competition as it contained provisions that allowed the Tribe to accept bets from players online even if they weren’t present on the Indian land simply because the servers were actually located on the Indian land and thus players can be “deemed” as “wagering on the Indian land”.

The Seminole Tribes competitors filed a lawsuit alleging that the compact would illegally allow online sports betting from any location in the state. In the lawsuit, they wrote, “‘Deeming’ the bet to have been placed on Indian lands because the servers are located there contradicts decades of well-established precedent interpreting applicable federal law.

As for the prospects of the case — some sport marketing experts in the US expect that Florida could agree to a new contract with the Seminole Tribe, restricting online gaming to only tribal land.

But more likely there might be a new amendment on the next year’s ballot that would allow statewide sports betting, opening it up to other casinos besides the ones the Seminole Tribe operates.

Georgia

The local external linkExternal links are prohibited to ban online casinos. Georgian prime minister Irakli Garibashvili  has announced that the country is to impose restrictions across two phases. Under the first of these, an increase in online casino taxes as well as a raise in the minimum eligible age for participation to 25 years are to be undertaken, alongside the prohibition of igaming advertising. In the second, it is envisaged that the activity will be banned throughout the country completely.

The Georgian prime minister claimed that 1.5 billion Georgian lari (around $477.5m US dollars) is exported out of the country through online casinos. Although it’s unclear from his comments what time period this claim covers. Irakli Garibashvili said that Georgian citizens play in online casinos on a daily basis and lose their money. According to him, 99 per cent of it is the money of people living in poverty with no jobs. Furthermore, Garibashvili said that he is ready to openly discuss the topic and thinks it will have support from the Georgian citizens. The Prime Minister has also mentioned that they will work closely with parliament to make an “optimal and reasonable” decision.

Ivan Kurochkin’s comments

As of now, it is hard to estimate how serious the government is about restricting access to online and land-based casinos. The initiative to raise the age limit in Georgia to 25 years was announced by the Ministry of Finance back in 2018, although since then, it has still not taken the form of the actual law.

It’s important to point out that at the moment, these developments exist only in a form of public discussion. There is no physical bill and no information on the expected date of the first draft.

Total prohibition of the online casino vertical may lead (as observed in many jurisdictions with strict gambling regulations) to the increase of illegal gambling and that is not what the government is looking for. Best regulatory practices reveal that any major changes to the gambling legislation should be developed in cooperation with principal stakeholders of the market.

CIS (The Commonwealth of Independent States, following the break up of the USSR in 1991)

QIWI plc, a provider of payment and financial services in Russia and the CIS announced its financial results for the third quarter ended September 30th, 2021. Revenue from continued operations increased 8% year-on-year to $161.4m. Total net revenue from continued operations decreased 2% year-on-year to $88.2 m. Adjusted net profit decreased 17% year-on-year to $37.2m.

The company also announced guidance for the 2021 financial year. Total net revenue is expected to decrease by 10% to 15% year-on-year. Payment services net revenue is expected to decrease by 5% to 10% year-on-year. In part the explanation of such expectation is simple as two companies called CUPIS (which is a centre of processing money from/to bookmaker customers) folded (and one of them was the one created by QIWI) and a joint CUPIS started to work instead.

Around 1.3 million e-wallets that were created for processing payments for the bookmakers via QIWI CUPIS are about to become dormant now as the QIWI CUPIS ceased to exist from October 2021.

The number of active QIWI wallet accounts was 14.9 million as of the end of 3Q 2021, a decrease of 4.8 million year-on-year. The decrease primarily resulted from the introduction of limitations on the anonymous wallets and enhancement of certain KYC, identification and compliance procedures.

The combined betting stream for nine months of 2021 represented 26% the payment volume and 38% the payment net revenue.

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