Gibraltar is a British overseas territory located at the southern tip of the Iberian Peninsula, east of the Bay of Algeciras, and extends over the geological formation of the rock of Gibraltar, bordering Spain and communicating the Mediterranean Sea and the Atlantic Ocean. It has a population of 33,000 inhabitants in an area of less than 7 sq. km.
Its official language is English and its official currency is the Gibraltar Pound (GIP), pegged to – and exchangeable with – the British pound sterling at par value.
The central bank controlling the GIP, with responsibility of minting coins and printing notes, is the Government of Gibraltar.
As a British Overseas Territory, Gibraltar has a governor, appointed by the monarch of the United Kingdom, who works as a representative of Her Majesty’s Government.
The governor is responsible for security in the territory and representation between the territory and the British Government; Also dissolves the legislature and acts to enforce the laws.
The Government of Gibraltar is elected for a term of four years. The unicameral Parliament currently consists of seventeen elected members. The head of the chamber is appointed by a resolution of the Parliament. The head of government is the Chief Minister.
Gibraltar is part of the European Union (EU) although with a special status. Being a British overseas territory, the UK is in charge of foreign affairs and business affairs.
According to the Treaty of Accession of the United Kingdom to the European Economic Community (EEC) in 1973, Gibraltar entered the EEC as a ‘European territory whose external relations the UK Government is responsible’.
Gibraltar is the only European territory enjoying this status in the European Union. In the referendum of Brexit its population voted mainly in favor of staying in the European Union.
As negotiated by the UK at the request of the Gibraltar government, some EU laws do not extend to Gibraltar. According to several provisions of the Treaty of Accession of the United Kingdom to the European communities, Gibraltar:
It is outside the customs union of the EU.
It is excluded from the Common Agricultural Policy (CAP).
It is excluded from the harmonization of VAT.
It does not allocate any part of the customs revenue to the EU.
Its economic activity is conditioned by its physical limitations and the lack of open land, which make agriculture non-existent.
It maintains a small amount of light industry for domestic consumption such as beverages. The main sources of income are on shipping, tourism, financial services, and the Internet.
In recent years there has been a significant expansion of hotel facilities to stimulate tourism. The port facilities occupy most of the western shore of the territory, as well as a portion of land gained to the sea in the bay of Algeciras.
In 1998, Gibraltar developed a tax law that made it an active offshore financial center, and currently boasts a broad offer of banks, investment banks, insurance companies, credit card companies, consumer finance companies, government-sponsored enterprises, and stock brokerages.
Gibraltar has become a center for Internet gaming companies. All gaming operations in Gibraltar require licensing under the Gambling Act of 2005. Despite the difficulties in obtaining these licenses, there are currently several operating in the Rock, some of which are among the world’s largest.