Entain’s Lycka Mulls Differences In Regulatory Approach Of Europe, U.S.

November 10, 2022
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It has been one year since Martin Lycka left Europe to become Entain’s top regulatory affairs executive in North America, and already he has noticed how distinct the oversight of gambling operations is in the United States and Canada.

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It has been one year since Martin Lycka left Europe to become Entain’s top regulatory affairs executive in North America, and already he has noticed how distinct the oversight of gambling operations is in the United States and Canada.

“The U.S. is even more process-driven than the UK and other European jurisdictions,” said Lycka, who is senior vice president for American regulatory affairs and responsible gaming at Entain.

“On the one hand, there’s a lot of red tape but also, to be fair… I do appreciate the open-door policy that most, if not all, U.S. regulators have.”

This open-door policy, he said, produces effective oversight largely because of an ongoing dialogue between regulators and gaming industry officials.

Lycka also praised the regulatory framework in Ontario, Canada, which launched online gaming on April 4.

“I would expect the other (Canadian) provinces to… follow the very successful Ontario model — the likes of British Columbia, Alberta,” he said.

Lycka describes himself as a “British-Czech man” who got into the gambling business while working for an international law firm in Prague, the capital of the Czech Republic.

When Betfair became one of his firm’s clients, the firm’s more senior attorneys balked at representing a company in an industry associated with controversy.

“So they foisted [Betfair] on the junior guy [Lycka],” he chuckled as he spoke to VIXIO GamblingCompliance on November 1 from his room at the Seminole Hard Rock Hotel in Miami where he attended the SBC Summit Latinoamerica.

Betfair offered Lycka a temporary job in London in 2009, and he ended up spending eight years with the company before moving on to GVC Holdings.

In December 2020, GVC Holdings rebranded itself as Entain to reflect the group’s ambition to be the world-leader in sports betting and gaming entertainment.

Lycka was in line to relocate to North America before COVID-19 struck in 2020.

The pandemic delayed his transfer to New York City until mid-October 2021.

Three months later, Lycka and his family moved to Jersey City, which is in the Garden State but is often described as New York City’s sixth borough.

At the very top of Lycka’s agenda in North America is responsible gaming.

“Unless we step up further under the responsible gambling front, the industry as a whole could start struggling with the likes of an ever-increasing number of consumer complaints,” Lycka said.

By emphasizing responsible gambling, Lycka said, “the U.S. markets, Ontario and ultimately Latin American markets…have a big opportunity…to avoid all the negativity that the industry is going through in Europe.”

That negativity includes a regulatory settlement brokered between Entain and the UK Gambling Commission this year, in respect to legacy systems and processes supporting operations of their British business in 2019 and 2020 that were not in line with evolving regulatory expectations of the commission.

The issues raised by the commission predate the many changes that Entain has introduced in safer gambling and AML, Lycka said, and since the alleged breaches took place over two years ago, Entain has “further reinforced our compliance processes across the board.”

Entain has made a commitment to service only domestically regulated jurisdictions, he said, and launched responsible gambling initiatives in Europe and North America.

“Consumer protection permeates the Entain culture. Fifteen percent of our bonuses depends on meeting our responsible gambling objectives and targets,” Lycka said.

The U.S. sports-betting industry failed to penetrate the coveted markets of California and Florida this year, but Lycka is bullish on Texas in 2023.

“I will be as brave as saying that I believe that Texas will get sports betting and regulation across the line next year with the market opening the day after,” he said.

Entain also is preparing to launch an esports vertical this year after acquiring the assets of Unikrn, an esports betting leader, in October 2021.

“I believe that surfing on the wave of ever-increasing interest in video games (and) offering esports betting is a no-brainer,” Lycka said.

In Asia, Lycka sees Japan and India as the most promising countries for gambling expansion.

“The word on the street is that Japan may start looking into regulating its online gambling market,” he said.

With a population of more than 125m and consumers with high buying power, Japan could influence neighboring countries to follow the Land of the Rising Sun into gambling expansion, according to Lycka.

The population of India is gargantuan, almost 1.4bn, and gambling regulation is spotty among its 28 states.

A federal regulatory scheme in India is likely to be a “slow burner,” according to Lycka.

As for China, where a crackdown on gambling is under way, Lycka said Entain plans to “steer clear.”

The Czech Republic did not qualify for this year’s World Cup, and even though he is a Brit-Czech, Lycka will not be rooting for England to win the tournament.

“My wife is Brazilian, so I know who I will be cheering for,” he said.

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