The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A prominent web shop operator says there are too many “outstanding issues” facing the industry that have yet to be resolved, including the permitted number of web shop locations and locations per operator, plus zoning enforcement.

Craig Flowers, the FML Group of Companies chief executive, told Tribune Business that with several gaming house operators having effectively exited the industry due to financial challenges, the status of their licenses - which were among the eight issued by the Gaming Board - remains unclear.

He added that while there have been reports of new developments within the industry, there appeared to be very little enforcement of the zoning regulations, which prohibit the location of web shops near schools and churches.

“It has been argued that there should be a moratorium on the amount of licenses issued in the Bahamas,” Mr Flowers said. “The problem that I am having is that I am not too familiar with how many licenses are active now that we are talking about locking up.

“We started with eight of us, and there were at least two or three companies that were having financial challenges. Is the Government allowing us to buy these licenses and leave them active? Is the Government cancelling these licenses and taking them back in? What are the number of licenses that currently exist?

“If someone can tell me there are five licenses and we are putting a moratorium on those, then fine, but if you are going to tell me that there is a moratorium being put in place and don’t say how many licenses are now active, I don’t know how I can endorse it.”

Nine companies applied for gaming house licenses when the Government began the process to legalise, regulate and tax the sector.

Eight applicants were subsequently provided with provisional licenses, with Bet Vegas the only operator to have been denied. Bet Vegas has since mounted a legal challenge to that decision via Judicial Review.

Island Luck, Nassau Games, Percy’s Island Games, A Sure Win, Chances, Paradise Games, Bahama Dreams and Asue Draw were all awarded licenses. However, Asue Draw + Spin later announced it would not renew its gaming house operator license for 2016-2017, and exited from the industry.

And Bahama Dreams ultimately sold a majority 65 per cent equity stake in its business to rival web shop chain, Island Luck, raising questions as to the fate of two of the eight licenses, and how they will be treated going forward.

Alluding to this, Mr Flowers said: “There has been zero information back to us as to how many of us really qualified when the licenses were issued.

“Companies have been closing left, right and centre. What are they doing with these licenses? Are they reissuing them? Have they been cancelled permanently, or is the Government allowing us to buy them and keep them active?

“We need public disclosure on the amount of active licenses out there. The Government had indicated to us at a meeting that there will be another license issued. Is that included as well? They never said who the license was going to be for; they only said another license is going to be considered.”

Obie Wilchcombe, who has ministerial responsibility for gaming, announced in a statement last week that the Government had decided to limit the number of gaming house operator licenses to eight until 2027.

However, this moratorium does not prevent the Minister from issuing a request for proposal (RFP) for a gaming house operator license in the event that its existing holder goes out of business or has it revoked.

And no such moratorium has been placed on the number of web shop houses that will be allowed to exist in the Bahamas, or on the number of locations each operator will be allowed to have.

This allows the Gaming Board and the Government to have the flexibility to “react appropriately to the development of the industry”, Mr Wilchcombe said.

The number of permitted web shop locations per operator had been a key concern for Mr Flowers. “I’m hearing a lot of things come out from the Government as it relates to new activities in the industry, and we haven’t been able to address the outstanding ones,” he told Tribune Bsiness.

“What is the limit on the amount of stores that a company will be allowed to have? All of us must be granted the opportunity to have the same number of locations. I need to know so I can plan and create a business plan conducive to my investment.

“In addition to that, are we ever going to follow up on the fact that there are some of us operating in proximity to churches as well as schools that need to be removed. There has been no conversation about stores that need to be relocated. The Act speaks to these things.”

A key objective of the newly-released regulations on gaming house premises licenses is to minimise any negative impact on communities, particularly places of worship, schools, premises where videos or similar games may be played by people, or premises at which pensions or welfare payments are collected.

The regulations say that no gaming house can be located “immediately adjacent, [or] at any property line, to a property whose dominant use is residential, unless zoned to be multi-use (commercial and residential)”.

And no gaming house can be located “within 100 feet of a place of worship, school, games arcade or premises at which pensions or welfare payments are collected.”

Gaming houses can also not be located “within 100 feet of any other licensed gaming house premise, unless the Gaming Board expressly determines there is good cause to conclude that proximity to another licensed gaming house of less than 100 feet does not offend the character of the area in which the premises is located, and the need to prevent over-proliferation of gaming house premises in any area”.