Gibraltar to Keep Borders Open Post-Brexit

Brexit has been a hot topic for the last four years. Speculation over its impact on the UK’s gambling industry has divided opinion, with one of the most frequently brought-up issues being Gibraltar. The future has looked uncertain for the British territory, but plans to join the Schengen zone mean that Gibraltar’s gambling industry could soon benefit from the best of both worlds.

The famous rock of the Gibraltar.

A large number of British gambling operators are based in Gibraltar, due to favorable tax conditions. ©Lutz6078/Pixabay

Brexit Deal Reached

It was June 23rd, 2016 when the results of the EU membership referendum were announced. After weeks of intense debate, the leave campaign was declared the winner, although the results were close, with 52% for leave versus 48% to remain. Then Prime Minister, David Cameron resigned, and Theresa May was sworn in on July 11th.

Three and half years later, and with yet another Prime Minister elected, the UK left the EU on January 31st 2020. However, that was only a transition period, and the real change was to come a year later. After more than four years of intense talks and political fallout, a deal was reached on Christmas Eve 2020.

New rules came into force on January 1st, and despite government assurances, there has since been chaos at the ports. Lorries have been unable to cross from the UK into Ireland and France due to stacks of complicated paperwork. Irish supermarkets ran out of vegetables, and fishing industry workers picketed Whitehall after shellfish spoiled due to delays at customs.

Businesses were long told to prepare for Brexit, but with a deal reached just days before the rules changed, many have been caught out. The British gambling industry is now navigating its offshore operations, with the future of Gibraltar’s operators of particular concern. A peninsula at Spain’s southernmost point, Gibraltar is a British Overseas Territory. Thanks to its corporate tax regime, it has become a huge draw for many British online gambling operators.

However, Gibraltar’s border with Spain has been an issue, as many commuters cross it daily to go to work. An estimated 15,000 Spanish workers travel into Gibraltar every day. There are now plans for Gibraltar to join Europe’s Schengen zone, which would avoid a hard border and the resulting need for crossing checks. While that hasn’t formally come into place yet, an announcement at the end of last year from Gibraltar’s Chief Minister offered some hope, stating:

“We believe we may now be able to re-set our relationship with Spain and cast it in a more positive light going forward. After many months of hard work, we have reached an in principle agreement with the United Kingdom and Spain. The agreement is for a proposed framework for a UK / European Union Agreement or Treaty on Gibraltar’s future relationship with the EU. That agreement will govern the relationship between Gibraltar and the European Union in areas of EU competence.”

Freedom of Movement

The New Year’s Eve agreement between Gibraltar and Spain means that in the future, movement across the border could be unrestricted. The Schengen zone consists of 26 European countries that have agreed to keep their borders open to one another. That means that passing from one country to another in the area is fast and easy, because there is no need to go through passport checks or border control.

Brexit means an end to this freedom of movement for British citizens, but an agreement between Gibraltar and Spain would be of huge benefit to its frequent commuters. For British operators based in Gibraltar, this news will certainly alleviate fears. In fact, Andrew Lyman, Executive Director of the Government of Gibraltar’s Gambling Division, is positive about the future of Gibraltar’s gambling industry.

Speaking to press, Lyman offered assurance that Gibraltar’s industry of online casino and betting services would thrive following Brexit. He also spoke about why a Schengen agreement is so crucial to the continued success of the territory’s vibrant gaming industry, explaining that industry workers need to be able to cross the border fluidly travelling to and from work. He went as far as to say that Gibraltar may become even more attractive for entrepreneurs thanks to better air links, which in turn would attract more new businesses.

Further details of how Gibraltar’s border with Spain have also been released. At the moment, there is one road that links the territories. That road will be widened, so that people and cars can travel in and out more easily. At the border, some guards will remain on standby, and there could still be some specific customs checks, although plans for those have not been finalized.

There is also continuing debate over whether Gibraltar will become “part of” or “connected to” the Schengen zone, with variations in the language carrying quite significant differences. Visitors to Gibraltar who travel by air or sea will still be subject to checks. Passport checks will also be carried out by guards from the EU border, as well as Frontex, a Coastguard Agency.

Nevertheless, an open border between Gibraltar and Spain will be a huge relief for British operators based in the territory, and the workers they employ. With the pandemic still causing widespread disruption and distress, more Brexit woes and a government review of the 2005 Gambling Act well underway, this will be one less worry for operators.

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