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Fax to Hon Minister of IT & Telecoms 26th February 2003 (ICT) 
 
 
 
 

Hon Pradeep Jeeha

Minister of Information Technology and Telecommunications

9th Floor

Air Mauritius Centre

John Kennedy Street

Port Louis

 

Date: 26th February 2003

 

 

Dear Honorable Minister,

 

Further to the meeting held in the Conference Room of your Ministry on 25th February 2003 at 1400 hours the following were noted

 

Only 25 % of the Office Space is reserved in the Cyber Tower, which is due to be completed in December 2003.

I expressed my views on promoting Mauritius as a hosting destination for online gambling and Casinos, which is the biggest revenue generating industry on the Internet.

 

The following document will justify the above-mentioned views and it will be my contribution to the Working Committee on the preparation for SECA 2003.

 

 

Honorable Minister, I am just doing my duty of a Mauritian as I am totally for the concept of the Cyber Island and fully confidant that the ICT sector will boost the economy of Mauritius.

 

I hope that you will consider the points mentioned in the document as I think, it will be a way to fill the remaining 75 % of the Cyber Tower.

 

Thanking you in anticipation,

 

Yours Sincerely

 

 

 

Dave Kissoondoyal, ACMI

Group Information Technology and Telecommunications Director

Bowman International Sports Ltd


Proposal to make Mauritius a hosting destination for offshore Online Gambling and Betting.

 

Preface

Online gambling operations have sprouted in cyberspace. “Virtual” or “cyber” casinos have boomed over the last several years into a very lucrative enterprise.  Online gambling revenues are expected to exceed $15 billion by the year 2005. This dramatic increase may be attributed to several factors, including increased Internet access, improvements in technology which facilitate online betting, increased public confidence with online financial transactions, and national licensing of Internet gambling operations by several countries.  Online gambling ranges from real-time casino-style gambling, to pari-mutuel betting, to sports wagering, to lotteries.  Placing a bet in cyberspace eliminates travel costs to casinos or other wagering establishments, protects a bettor’s privacy and anonymity, and currently provides those who wish to skirt state restrictions on gambling a means by which to do so. On-line wagering promises to revolutionize the way people gamble because it opens up the possibility of immediate, individual, 24-hour access to the full range of gambling in every home.”

Many Governments including those of Costa Rica and the Caribbean Islands do provide the incentives for online gambling business to operate. In Costa Rica itself there are about 150 betting centres or "sportsbooks" at which an estimated 10,000 to 15,000 young people are employed, many of them university students who make 4-8 dollars per hour.

 

There has been a drastic change that the Costa Rican Government is bringing which Mauritius can take advantage of. The following articles speak by themselves:

More Taxes For Costa Rican On-Line Gaming Operators
by Mike Godfrey, Tax-News.com, New York 
13 February 2003

 

Costa Rica's government has continued its efforts to extract some revenue from its booming gambling industry, with the news that the economy ministry will establish a registry of online gambling companies, and will charge each one between 10m and 24m Colons (US$26,000 to $63,000) according to the number of persons employed.

The initiative follows congressional legislation that established taxes targeted at gaming companies. Last December, provisions to tax casinos and online betting operators were approved in the National Assembly by a margin of 45 to 5.

Slot machine operators had protested that plans to tax them between US$250 and $300 per slot machine, per month would drive smaller operators out of business, and in the event the rate per machine was reduced to US$20. Computer terminals used to place bets were to have been charged US$1,000 per month, but this was revised down to $500.

It remains to be seen whether the on-line gambling operators will accept what seems to be a fairly heavy impost, or whether they will defect en masse for friendlier shores, or just take avoiding action by outsourcing labour-intensive work to other jurisdictions.

 

http://www.worldmarketsanalysis.com/wma_sample_pages/site_pages/WMRASampleDailyAnalysis.html

Latin America and Caribbean

 

 Costa Rica: New Taxes Could Threaten Costa Rica's Online Gambling Operations - (Mon 20 Jan 2003)

Internet gambling sites began establishing themselves in Costa Rica in 1996 in order to take advantage of vague legislation on gaming, cheap labour and English-speaking workers. However, with the government threatening to impose new fees or taxes on the industry, the boom days for internet gambling websites could be over. Many gambling operators have already said that they will simply move on to the next gambling-friendly haven, singling out Panama and Belize, which are offering buildings, lax tax requirements and maybe even a break on telephone fees, as possibilities as sites for their operations. Both countries need to create jobs. Gambling operators have in the past bailed out quickly from countries when it seems that they are no longer welcome. For example, the imposition of new taxes in Antigua on the industry in the mid-1990s caused the operators to quickly leave the island. Costa Rica is clearly unhappy that the internet sports betting operations, which are disguised as data processing centres, pay no licensing fees and few taxes. It is also concerned by the industry's reputation for money laundering. However, the industry provides 10,000 to 15,000 well-paid jobs, so a final decision on the direction of government policy will be difficult to make. In the meantime, internet gambling operators may see increased regulation as inevitable. If so, they will already be planning their next move.  

 IF MAURITIUS CAN PROVIDE THE RIGHT ALTERNATIVE TO THEM, I AM SURE THE BOOKMAKERS WILL HAVE NO HESITATION COMING TO MAURITIUS.

Control and Regulation

 

Despite all the promises and ambitions this industry seems to offer, there are numerous con artists, scam operators and disreputable people in this industry (some with criminal records). It would be short sighted to think that everyone in this business is honest. Some firms claiming to be the most reputable and honourable in terms of casinos and business are in fact out to rip everyone off. Despite their glowing and trusting appearance, they are the opposite in every way. Some online betting companies do not abide by agreements in the form of contracts they sign.

 

Therefore the appropriate control has to be put in place by the Government before issuing any licenses. Remember, there is close relationship with the financial offshore business and the offshore online gaming business. Since the appropriate agency on the offshore financial side is doing pretty well, I am confident that this Government, which is really determined to combat fraud and corruption, will have the necessary control in place for the offshore online gaming industry.

 

This industry provides its own means of accessing the players itself.

Major Wager (http://www.majorwager.com ) is a site which gamblers voice their satisfaction and dissatisfaction with various casinos. It is an extremely popular site, which gamblers read regularly. The Casino Affiliate Programs' Scam Alert (http://www.casinoaffiliateprograms.com/scam_alerts.htm ) watches the various webmaster affiliate programs offered by casinos. For a casino to be listed in a negative light on either of these two webpages is not a good thing and can hurt the financial profitability of such an operation long term.

 

 

I have a critical view of the participation in SECA for the past years. What have we achieved through the participation in SECA year after year? Not much.

 

I personally think that we should change the strategy and present Mauritius as an Online Gaming hosting destination.

 

When businesses have an online business, it is evident that they need to have a call centre to be able to operate. Online gaming businesses and call centres do work together.

 

Where there are online bookies established, Gaming Software development companies do get established as well to provide technical support and service. In Costa Rica, big software development companies like IQ Ludorum, Extension Software Inc etc have their offices there to be able to provide support to the online businesses. 

 

If we adopt this strategy, I am sure that we would get so much of business that there would not be enough free space to fill in the Cyber Tower.

 

My personal view is that in SECA 2003, together with the strategy of promoting the concept of Call Centres, much emphasis should be laid on making Mauritius the destination for Online Gaming hosting business.

 

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Last Updated Wednesday,10  September 2003    

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