Gambling:A Safe BetP

How big a threat to Gibraltar's place in the Cyberspace gaming industry are recent moves by the US Congress which, in theory, should put an end to American punters placing bets with offshore firms such as PartyGaming,888.com and SportingBet? That's the question hundreds of locals employed in the industry have asked in recent weeks.

Are their jobs secure? What will happen on the middle and lower rungs of the property ladder in terms of the prices of homes?

Could some of the 14 local gaming companies — which between them employ almost 1,500 staff— move their operations elsewhere leav ing a 'black hole' in Government revenue that the already hard-hit individual lax-payer would have to plug? These are only a few of the questions doing the rounds on the Rock.

And — though Chief Minister Peter Caruana appears to take a less roseate view of the issue than that of his usual optimism about anything relating to Gibraltar's economy — the answers to most of the questions are encouraging. While the industry accepts that the loss of American punters will have a heavy impacton the profits of the bigger players whose main custom ers are on the other side of "the Pond", most have initiated plans to broaden their non-US base.

Suggesting that Gibraltar would not "escape unscathed" from the proposed US measure which could close the door to American gamblers betting on offshore-based internet gaming sites, Caruana forecast that there would be "interim pain, no doubt of that." But he believed the gaming companies would remain committed to the Rock and that they would pull through the dif ficult times ahead. Most of the big companies are more sanguine than the Chief Minister.

A multi-lingual betting service and a massive promotional drive to attract global punters will be accelerated by the PartyGaming Group, I was told. And other online gaming firms such as 888. com and SportingBet have similar contingency plans — prepared when &e first threats of potential US protectionist measures raised their heads above the international gambling parapet.

The moves — and the fact that in the first half of this year PartyG aming clocked up more than $150 million in profits from its gaming operations outside the US — have secured the jobs of more than 1,000 Gibraltarians and ex-patsemployed in the industry on the Rock... at least for the time being.

"One can never say 'never', but as things stand there is no likeli hood that a single job in Gibraltar will go," PartyGaming spokesman John Sheppard told me in a tele phone call from London on last month's "black Monday" when the roof fell in on gaming company shares.."Of course it(the US move] is a setback for the company, its

Following the move in the final hours before Congress went into recess for this month's elections, which saw Capitol Hill approve legislation making it unlawful for credit-card companies to collect payments for transactions with online-gaming sites, shares in PartyGaming, the world's biggest online poker operator,slumped by almost two thirds while those of 888.com — the second largest Gi braltar-based operation—dropped by 56 per cent.

The falls saw the personal for tune of Ruth Parasol, the reclusive co-founder of PartryGaming and its biggest individual shareholder, plummet from an estimated £310 million to £100 million.

Between them PartyGaming and 888.com employ more than 500 people in their round-the-clock telephone and on-line gambling operations on the Rock. Both com panies draw more than half of their punters from the United States — though since US threats to the industry reached Capitol Hill they have made strong — and largely successful—effortsto expand their client base away from the United States.

Nevertheless, both companies expect their profits to be hit hard when,and if, President Bush signs the bill into law next month, and news of the Congressional victory — achieved by political sleight of hand — led locals to fear for their relatively highly-paid jobs. Howev er, although there is no short-term fix, potential for growth outside the US seems secure and likely to lead to recovery — jobs now seem safe. PartyGaming, particularly, believes that its massive profits increases over the past two years are largely due to the efforts of its Gibraltar staff.

In spite of attempts by the US^