Moving one step closer to becoming the first Gulf state to legalize casinos, the UAE last month established the General Commercial Gaming Regulatory Authority (GCGRA) to create a framework for regulating national lottery and commercial gaming – a move that industry experts believe may lead to billions of dollars in annual revenue.
A timeline for the regulatory body to begin its operations is yet to be announced. Abu Dhabi will be overseeing GCGRA’s operations, as is the case with all federal authorities. However, the rulers of each of the seven emirates will have the power to decide whether to allow gambling or not.
Gambling has, in the past, been off-limits in the UAE, but reports suggest the country could be exploring that option in its attempt to boost its tourism industry.
“There are expected to be a number of positive effects, from domestic and international tourist attraction, longer vocational stays in the region, to additional incentives for bringing events to the area,” legal and business expert on UAE regulations at The Sovereign Group, Zana Jablan Musa, told Al Arabiya English.
“The new legislation will potentially allow casinos to operate while docked and this could be a game changer and very attractive to cruise liners. This will help bring in significant revenue, following the model of Singapore, where gambling contributes a notable percentage of GDP,” she added.
The UAE could generate as much as $6.6 billion in gaming revenues annually and eventually surpass Singapore, where gambling constitutes 1.6 percent of the GDP, according to a Bloomberg projection.
The revenue generated from gambling can lead to “significant” state income, in turn benefiting residents, Musa said, adding that GCGRA’s framework to regulate gambling and lotteries will be “crucial” in mitigating the negative perception that may have been associated with gambling and the strict policies surrounding it in the past.
“This (GCGRA) equips the UAE to best design and implement a gambling operation as they deem appropriate,” she said. “If you take the example of Hong Kong, with horse racing being the only legal form of gambling, revenues from these events go to the government, which in turn provides a significant opportunity to the government to give the benefits back to residents and citizens,” Musa explained.
The establishment of GCGRA comes about a month after hotel and casino operator Wynn Resorts, which is building a $3.9 billion gaming resort in Ras Al Khaimah, said it expects to obtain a license soon.
Although the country has not announced any immediate plans to allow gambling, earlier this year, Bloomberg reported that casino operators, consultants and lawyers familiar with the matter said they were at an early stage of discussions and a possible change in policy was being considered.
Gambling is prohibited in Islam. Currently, the UAE imposes hefty fines on gambling offenders.
Legalizing gambling could be a game changer for the Gulf country that follows Islamic and Sharia law.
With the UAE known “to react quickly to changes and roll out regulations,” Musa said she won’t be surprised “to see the framework published in three to six months.”