‘Sports wagering is really dragging online gaming along with it’ – Panel addresses evolving regulations

“Online gaming in the United States is very much evolving”, or so believes Susan Hensel, co-founder of Hensel Grad, a firm helping iGaming companies navigate the country’s regulatory market.

iGaming in the country is “very much” in its infancy, with only six or seven states that have authorised online casinos, compared to the “30-or-so” that have authorised or are operating sports wagering online, she has found.

This, she said, speaking during a CasinoBeats Summit panel on the evolution of iGaming and online gambling in three key jurisdictions – Malta, the UK, and the US – titled ‘The Evolution of Online Casinos’, has created somewhat of an unexpected phenomenon.

“We thought that internet gaming would lead the way, but it has turned out that since the fall of PASPA – the law that prevented sports wagering in the United States – sports wagering is really dragging online gaming along with it as we see sports wagering in an online environment”, she explained. 

“We’re still very much at the front end of the learning curve for the regulator, for the industry and for the player. 

“What we do know is that in the United States, any type of gambling authorisation is a state right issue so we have in the online space, as we have in the land-based world, a fragmented approach to the regulation and to the legislation that oversees the various forms of gambling”.

Turning to the future, Ms Hensel predicted the continued opening up of states to online gambling.

“We are going to see more states come online in the coming months and years. It seems every day we are reading about more states authorising sports wagering, but we’re all working out way down that learning curve together and I’m sure that the industry and the regulatory approach to the industry will evolve as we go forward.” 

Ms Hensel was joined on the panel by Hilary Stewart-Jones of Harris Hagan, and Yanica Sant, general counsel at the Malta Gaming Authority (MGA).

Dr Sant discussed how the regulatory environment in Europe is evolving, and how Malta introduced a new wave of regulation in parallel with this in 2018.

“The best improvement is that the legislation, the legislative framework, is now objective-based, so we have a set of regulatory objectives which we aim to achieve by virtue of every regulation that we enact and impose upon our licensees”, she explained.

Discussing the regulatory philosophy of the Maltese authorities regarding iGaming, she emphasised the jurisdiction’s belief in mutual recognition.

“As a jurisdiction, we have always believed in mutual recognition. We have always been a point of supply jurisdiction and we believe that as long as a company is licensed and regulated in Malta, or in any EU jurisdiction for that matter, as long as we all have the same regulatory objectives, then we will always acknowledge that licence from another EU jurisdiction”.

Ms Stewart-Jones reflected on the growth of the UK gambling industry and regulatory framework from the industry’s roots in telephone betting to the roaring success of the online gambling industry, which most now accept.

“Everything has evolved in terms of the online gambling industry to see that obviously it’s a mainstay now for most. Even bricks and mortar companies now have an online presence, but also the regulation has evolved as well”.

The UK gambling industry had some tough times, she reflected, including a period during the 1990s when they were blacked out and weren’t allowed to advertise, but online gambling proved to be a game changer as it allowed paved the way for a new regulatory framework through the UK Gambling Commission.

In turn, this has seen the country develop a particularly rigorous and broad licensing system, she said. 

“We’ve ended up with a lot of people in our licensing net. We’ve got operators, suppliers, host providers. Any type of product is effectively the subject of separate licencing criteria. We’ve got software providers, gaming machine manufacturers. 

“We’ve even got betting intermediaries. We also have a concept of personal management licencing in the UK so that executives who have key roles are personally on the hook and can be personally prosecuted”.