UK Channel Island opens arms to e-gambling
By Linda
One of the UK Channel islands Alderney has amended legislation to allow online gambling firms to set up businesses there.

The tax haven island Alderney has issued its first interactive gaming licences to three firms, local officials have announced.

The Alderney Gambling Control Commission has issued licences, to Littlewoods Leisure, Ritz Interactive and online casino developer WagerWorks, a developer of Internet gaming technology.

The island is located between Britain and France, but is a British Crown dependency.

Littlewoods Leisure intends to launch its own online casino via its Isle of Man licence and hold the Alderney licence for potential partnerships with third-party companies looking to break into the market.

Suzanne Judge, spokeswoman for Littlewoods Leisure’s parent company Sportech, said: “Part of our strategy is to expand channels of distribution to reach new customers and we will use the Alderney licence in case we want to do something with a third party to develop new products.”

Ritz Interactive is a subsidiary of The Ritz Club, based in The Ritz Hotel in London.

The issuing of the licences sees Alderney challenge the status of The Isle of Man as the offshore bastion of regulated online gaming for companies targeting the UK market.

The Isle of Man has awarded online gaming licences to Nevada-based MGM Mirage, Littlewoods Leisure, Rank Organisation and SunOnline, the new-media division of resort and casino operator Sun International Hotels.

“The Isle of Man is a competitor, but we believe we have stricter regulations,” said Ilona Soane-Sands, States of Alderney marketing manager. “We expect the first operation to be up and running in July.”

The commission added that politicians on the island have amended original legislation drafted last summer, removing a cap on the number of e-gaming licences it is permitted to distribute.

Alderney, together with the Isle of Man, also a UK Crown dependency, have been vying to attract top-flight gambling firms to set up online businesses, luring them with a pitch of a friendly tax regime and stable regulatory environment.

The interactive gambling sector is a promising one. A widely cited US report by gambling consultancy River City Group estimates it will be a £3.5bn industry in 2003.

But the early hype has been tarnished of late by reports that some site operators do not pay out jackpots and that some gamblers commit credit card fraud.

Because many gaming sites operate in loose regulatory environments in the Caribbean, defrauded victims have little recourse to recoup losses. The issue has forced some credit card companies to ban outright Net gambling transactions.

Authorities in offshore tax haven islands are trying to change the image, promising strict compliance rules to woo the more established gaming firms.

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