GIBRALTAR: Britain and Gibraltar are regarded as one EU state in terms of a key aspect of the single market, said the EU’s top lawyer, in a decision that might affect the rocky entity’s status after Brexit.
A statement from the advocate general to the European Court of Justice, Maciej Szpunar said he “takes the view that, for the purposes of the freedom to provide services, Gibraltar and the UK are to be treated as one entity”.
“The application of EU law to Gibraltar does not create new or supplementary rights between the UK and Gibraltar that are in addition to those flowing from the UK and Gibraltar constitutional law,” said Szpunar. The legal representative disputed a challenge from Gibraltar’s large electronic gambling industry, the key driver of its booming economy, against taxes imposed by London in 2014.
The Gibraltar Betting and Gaming Association is challenging the tax which required all UK-facing operators, no matter whether they were located in the UK, to pay 15 per cent on revenue from UK gamblers. The industry alleged that the UK was trying to tax the free movement of services, one of the EU’s “four freedoms” with people, goods and capital.
It means Britain has the right to charge the domestic tax, because it is not covered by EU law, which would bar London from introducing a tax which had an impact on another EU state. The court frequently follows the advocate general’s rulings when it hands down its final decision. Gibraltar has been examining ways of staying in the single market if Britain leaves.
Held by Britain since 1713, Gibraltar, a 6.7-square-kilometre peninsula in southern Spain, has about 33,000 residents, and has an electronic gambling sector and offshore financial services that trade with the whole EU.
Gibraltar has looked to UK Prime Minister Theresa May to confirm its commitment, amid fears it will be vulnerable to Spain, which wants to reclaim the territory. The EU has had to resolve fishing and border disputes with Madrid in the past.
A Gibraltar governmental spokesperson said: “Her Majesty’s Government of Gibraltar notes the opinion of the Advocate General of The Court of Justice of the European Union in the case brought by the Gibraltar Gaming and Betting Association.