The Gibraltar Betting and Gaming Association (GBGA) has been dealt a blow following the European Court of Justice (CJEU) ruling that the principle of freedom to provide services does not apply between the territory and the UK and that the provision of services by Gibraltar operators to customers in the UK is “a situation confined in all respects within a single member state,” under European Union law.
Operators are now obliged to pay 15% on all bets placed with them, but the tax remains at a low rate compate to other EU countries, such as Spain, which collects 25% for all bets.
GBGA has claimed that POC tax is illegal under the European law because of the violation οf Article 56 of the Treaty on the Functioning of the EU, which concerns the right to free trade across borders.
As per the European Court of Justice, Gibraltar belongs to the European territory as the UK is responsible for, and that the EU law is applicable to that territory.
Judgement said that, “Although Gibraltar does not form part of the UK,” the judgment states that “Gibraltar is a European territory for whose external relations a Member State, namely the UK, is responsible, so that EU law is applicable to that territory.”
“There is no factor that could justify the conclusion that relations between Gibraltar and the UK may be regarded as akin to those existing between two Member States.” as per the court.
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