UK
PHOTO: SOURCE: UNSPLASH

Historically one of the leading iGaming hubs in the world, the UK has long been among the most sought-after markets for gambling start-ups. It is no wonder, as the country still retains the status of the largest European gambling market, generating £15.1 billion and £15.6 billion in gross gambling yield in the 2023 and 2024 fiscal years, respectively.

Despite still offering great return potential for gaming firms looking to enter the market, the UK is no longer the jewel in the crown. Formerly highly praised for supportive regulation and start-up-friendly incentives, the UK is becoming increasingly difficult for operators to conduct business in.

Over the last five years, the country has witnessed a substantial outflow of active gambling operators, adding a new migration pattern to the industry. Many firms are reducing their UK presence or relocating completely to jurisdictions with more attractive business climates, including offshore Anjouan or other European hotspots like Estonia and Malta.

Fewer Operators Each Year

For five years in a row, gambling firms have run away from the UK market, according to the regulator's website. The latest figures from the UK Gambling Commission (UKGC) reveal a 12.2% decline in the number of active iGaming operators in the market since 2020.

Even with a certain number of new licences granted each year, the total number of gaming businesses in the region has fallen from 2,576 (as of 31 March 2020) to 2,262 by the end of 2024. Exits peaked in 2021 when 137 operators left the market, followed by 20 in 2022, 76 in 2023, and 81 in 2024.

Once regarded as the "iGaming capital of the world", the UK is slowly becoming the capital of caution as firms silently run elsewhere.

Why Are Companies Leaving?

The main catalyst for companies ceasing operations in the UK is widely considered the ever-intensifying enforcement by the country's gambling regulator. The UK Gambling Commission has doubled down on enforcement, introducing regular audits, significant fines, and, in certain cases, licence suspensions for minor breaches.

In 2024, eight operators alone paid a combined total of over £13.4 million in fines (£7.16 million) and regulatory settlements (£6.24 million). Starting from this month, however, the penalties are expected to rise further. A revised UKGC enforcement model will impose percentage-band fines tied to operators' gross gambling yield (GGY).

Going further, for the most serious violations, the fine may be calculated at 15% of an operator's GGY, or more in exceptional cases. With this in mind, small and medium-sized operators focused on reinvesting earnings back into the business cannot afford the high risk of large penalties or strict enforcement that could hinder their growth.

Even major gambling operators, however, are under the microscope. Back in February 2025, Stake, one of the largest casino operators around the world, left the UK amid regulatory scrutiny of its social media advertising by the Gambling Commission.

Apart from probes and penalties, operators are also subject to a 15% gross margin tax, increasingly strict reporting standards, and more rigorous AML/KYC controls. The rising cost of maintaining compliance, coupled with legal uncertainty brought about by every change in gambling regulation, makes long-term strategic planning extremely difficult.

Facing continuous pressure in the UK, more iGaming operators are deciding to migrate to jurisdictions with a stable regulatory climate, lower ongoing expenses, and minimised risk exposure – all collectively allowing for sustainable growth in a highly competitive industry. In effect, once a magnet for iGaming firms, the UK market is losing its allure as operators find the current compliance rulebook unsustainable.

The Shift Towards Offshore

In light of the current unfavourable climate, many operators choose to establish themselves offshore or other emerging hubs to gain relief from the problems of running a gambling business within the UK. Jurisdictions like Anjouan, Estonia, Nevis, Kahnawake, and Tobique continue to attract a steadily rising number of operators each year.

International market access (subject to the operator's responsibility), low or no corporate and GGY-based taxes, cost-efficient and relatively fast licensing, global reputation, and a steady regulatory environment make offshore options a breath of fresh air for gambling businesses.

Currently, therefore, UK gambling companies increasingly seek qualified consultancy support from firms like Inteliumlaw to secure an offshore gaming licence for their business. These firms are seeing an all-time high demand for legal counsel from industry operators on establishing themselves offshore, assisting with company formation, licensing, and compliant market entry.

With proven industry expertise, such legal advisers help start-ups launch, support mature businesses as they scale by covering compliance matters, and ensure a seamless transition for companies relocating to more favourable regimes.

As gambling has long been a mainstream leisure activity in the country, the United Kingdom is still considered one of the leading iGaming destinations, offering a mature regulatory framework and strong earnings potential for operators. Yet, with regulation tightening and costs climbing, gaming companies are forced to establish themselves elsewhere. Without decisive reform, operators will likely keep steering clear of the UK and migrate offshore, while the country risks losing gaming revenue and its current position on the global iGaming stage.