Alderney Gaming Commission Proposes Policy Overhaul

by Robert Lee, Tax-News.com, London

24 August 2009

The Alderney Gaming Control Commission has announced several changes to its policy following a 'constructive exchange of views' at a recent meeting. Based on recommendations presented at the meeting, the Commission proposes:

• Introducing a further intermediate fee band at GBP100,000 for Category 1 (B2C) licenses, to lessen the immediate increase for the largest operators.
• Limiting the increase in fee in any year to only one band irrespective of the licensee’s Net Gaming Yield.
• Recognising in the Net Gaming Yield definition the significant difference that exists in the revenue model of aggregator games such as interactive bingo, as compared to a standard remote casino.
• Deferring the implementation of increases arising from the new fee scale for existing licensees and associates to their first renewal following March 31, 2010, in order to provide adequate time for effective budgeting for any increased license fees.
• Recognising the need for a Category 2 licensee to be incorporated in Alderney.

Also discussed within the review of its policy, was streamlining its ICS review policy and increasing the use of its power to grant ‘conditional approval’ where ICS drafts are incomplete but broadly compliant.

The review also focused on the treatment of inactive and dormant account balances. Under the Commission’s proposals it has decided to relax the wording of Regulation 344 to allow licensees to assimilate inactive accounts, subject to strict conditions. Under the conditions licenseholders must:

• Notify account holders of company policy in player terms and conditions.
• Ensure Adequate and proportionate efforts are undertaken to return funds to players.
• Provide a clear definition of inactive / dormant accounts.
• Commit to repay assimilated funds to player on demand.
• Ensure robust security controls to prevent internal fraud.

The Commission is also currently reviewing the regulatory provisions on licensees’ capital adequacy. These are formulated on the protection of player funds and as such would only be relevant to Category 1 licensees in the new licensing model. However the Commission wishes to implement revisions to this regime and at the same time to specify the minimum capital requirement for Category 2 licensees. Proposals are likely to be put forward in September, for implementation in January 2010.

Lastly, the Commission plans to amend its regime to categorize those applying for a license under two categories: licensed activities or certified activities. The two categories are aimed to distinguish those activities which take place within the legal jurisdiction of Alderney from those activities and services rendered by entities outside Alderney’s legal jurisdiction.

In light of the proposed changes to Alderney’s regime, the Commission has revised annual fees applicable to different company forms. The newly proposed rates, upon approval, will become effective from January 2010, although - as a transitional measure - where the annual fee for a company wishing to renew its license before March 2010 is greater than that under the original regime, the licensee will be allowed to pay the lower rate. This allowance will not apply to those applying for renewal after March 2010. Comprehensive information on the proposals and annual fees is available on the Alderney Gaming Control Commission’s website.

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