Entain Must Exit Unregulated Markets as Per the DPA

Entain recently reached a deferred prosecution agreement (DPA) with the Crown Prosecution Service (CPS). However, the settlement also says that Entain will have to exit unregulated markets.

For reference, the DPA saw Entain commit to pay $737.5 million because of the bribery-related offenses of its former Turkey-facing business. The company was also required to donate $25 million to charity and pay $12.5 million to cover the HMRC and the CPS’s costs.

In addition, as outlined in Clauses 32 and 33 of the DPA, Entain must cease its operations in markets that are yet to regulate gambling by the date 12 months after the exit date of the DPA. In addition to that, Entain must confirm that it is not operating or offering gambling in markets outside of regulated ones.

Entain has been striving to focus on regulated markets but has remained operational in a few markets that may regulate gambling in the near future. These include Brazil, Chile, Peru and Mexico, which have been mulling over the legalization of iGaming for a while.

Thanks to EU laws, Austria and Finland have been exempted from these clauses, allowing Entain to continue offering products to local players.

Entain May Request the Exit Date to Be Postponed

Under the DPA, Entain will have to commit to exiting the aforementioned markets within a year. Clause 33, however, may help the company retain its foothold in some of them.

As specified in Clause 33, Entain may request its exit date to be postponed in case it has a valid reason to make this demand. According to the clause, if Entain considers “that there are reasonable grounds to consider that the process of regulation will be completed within a reasonable time of the exit date,” it might request such an extension.

The company may have luck in Brazil, where the legalization of betting and iGaming is showing some signs of progress. However, Latin American markets remain somewhat unhurried in these matters, meaning that Entain might have some trouble convincing the CPS that any of them will legalize online gaming soon.

In any case, Entain must keep the CPS informed about its material position, market exits and potential regulatory changes.

If Entain is purchased by another company within the next four years, its new owner will have to make sure that its obligations under the DPA are fulfilled.