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Entain has received its permanent Nevada gaming license after almost five years of operating in the state with a temporary license, amid concerns from regulators about its business in unregulated markets.

Barry Gibson, the chairman of Entain who will retire in September after four years with the company, assured the Nevada Gaming Commission (NGC) on Thursday (May 16) that Entain no longer does any business in unregulated markets.

“We have accelerated our removal from unregulated territories around the world,” Gibson said. “Some 140 countries that we used to trade in, we no longer trade in.”

That decision, Gibson told the commission, came at a “big price” to Entain and cost the company “£100m of profit”.

Gibson said some 95 percent of Entain’s revenues now come from regulated markets or markets that are about to regulate. Brazil accounts for about 5 percent of the company’s revenue.

Gibson said that Brazil “is really the only big market we are in that is on the path to regulation. The government has passed the laws, and the gambling commission is in the process of awarding licenses.”

Entain has undergone substantial changes since it first appeared before Nevada regulators in 2019 as GVC Holdings and was given a two-year temporary license.

At the time, the company was told to end any relationships with unregulated markets worldwide.

In May 2021, the NGC granted a three-year license to Entain, which is half of a joint venture with MGM Resorts International in BetMGM and also owns Las Vegas-based Stadium Technology Group. BetMGM's mobile sportsbook was relaunched in Nevada in February of this year using the Entain technology platform.

On Thursday, the five-member commission voted unanimously to approve Entain’s application for a permanent gaming license.

“We have been and continue to be in a process of continuous improvement, transformation, and enhancing the company’s governance and compliance efforts” since 2021, said Simon Zinger, Entain’s general counsel.

Zinger told the commission that approval of a deferred prosecution agreement (DPA) with UK authorities in December 2023 “reflected a chapter in our company’s history that is now behind us”.

Last year, Entain agreed to pay a penalty of £585m ($729m) under the DPA with the UK’s Crown Prosecution Service (CPS) to avoid any charges relating to alleged anti-bribery offenses at GVC’s former Turkish business.

The DPA ended a probe that was launched by HM Revenue & Customers (HMRC) in 2019. 

“With the court approving the DPA to be in the public interest, we saw the court acknowledging Entain’s exemplary cooperation [and] recognizing the wholesale change in the management team and validating our approach to culture and compliance practices,” Zinger told Nevada regulators.

Entain is also being actively investigated by Australian financial crime enforcer AUSTRAC for whether the company has “complied with its obligations” under Australian anti-money laundering and counter-terrorism financing (AML/CTF) legislation.

Entain executives on Thursday acknowledged the AUSTRAC investigation but did not update commissioners on the status of the probe that began in September 2022. 

Zinger reiterated Gibson's statements that Entain only operates in regulated or regulating markets.

Commissioner Brian Krolicki noted Entain’s presentation to the Nevada Gaming Control Board (NGCB) was extensive and detailed but “from regulated to regulating is a new verb for me”.

“You told the NGCB that those who are regulating but don’t successfully … conclude that process into regulation within 12 months, Entain will exit that market. Is that correct?” Krolicki asked.

Zinger said that was correct and it was a firm commitment that Entain had written into the DPA with UK prosecutors.

“We have a period of 12 months from December 2023 for regulation to take place and those markets to be regulated,” Zinger said. “If it doesn’t happen, we have an opportunity to discuss with the CPS the reasons why a delay may have occurred.”

Zinger described a legitimate delay as having legislation pending, or regulation was still being actively debated among politicians.

“Things get delayed,” he said. “We have seen this in Brazil, for example, but 12 months is very much the objective in getting all that type of thing sorted and we feel strongly that in terms of the biggest market that is still pending and is in the process of regulating, being Brazil, it is very much on the way there.”

Zinger said they expected that regulations and the licensing framework to be in place in Brazil in the third quarter of 2024. 

“So that is well within the 12 months,” he added.