24 septembre 2009

Online Gambling In Europe: Much Confusion, Still

While Europe is liberalizing online gambling, the recent European Court of Justice ruling on Portugal's state-run betting and lottery services provider, Las Santa Casa de Misericordia, suddenly reboosted the ancient model. In fact, the European Court of Justice confirmed on the 8 September the right of the Portuguese Government to forbid private companies of providing online betting services. Fraud prevention and punter protection seemed to be the main justification behind the Court's ruling.


"The prohibition imposed on operators such as Bwin of offering games of chance via the Internet may be regarded as justified by the objective of combating fraud and crime."

Ladbrokes, an online betting and gaming company, have just pulled out of a similar case after the Norwegian Government indicated that they would be using the Portuguese case as precedent. Thus, it could be more difficult for bookmakers to fight state monopolies despite of the new European law, as player protection and fraud prevention can always be used as an excuse for maintaining the state monopoly.

Following the Portuguese case, the European online gambling industry has responded angrily to the European Court of Justice ruling and Bwin has asked for an update of EU regulations. If the laws are not updated, a black market is likely to thrive and Europe may suffer the potential downsides of online gambling. Italy, France and Great Britain have already made concessions to change legal framework allowing for cross border trade of internet betting services as opposed to the position Portugal and Norway has taken.
"Online gaming has become a market reality. There is an urgent need to develop a legal framework in tune with the times to warrant the interest of consumers, the state and operators." Manfred Bodner, Bwin Co-CEO

"Only a regulated online gaming market with a diversified and attractive line-up of games will provide adequate security against the risks of a black market." Norbert Teufelberger, Bwin co-CEO

On the other hand, Denmark just took the opposite stake by proposing a new law to tear the monopoly down, in compliance with the European law.

"We have a special way to deal with earnings generated by online games. Denmark is a country full of sports clubs and associations. Part of the earnings generated by the industry goes back to these associations. We are aware of the problems of addiction created by gaming and we dedicate part of the revenues to fight them as well as money laundering and fraud. We have three major objectives for the time being: better protect the players, fight organized crime and donate money to charities."

Denmark hopes that the new bill will be approved by the European Commission as it could take effect in 2011.

Meanwhile, France seems to be leading the field in betting regulation with a new law that requires a business offering a sport bet to have acquired:
  • the right to do so from the corresponding national federation;
  • an official license provided by the ARJEL (Autorité de Régulation des Jeux en Ligne), the official body regulating betting in France.
While horse racing has structured its betting activity in France, no other sports do for the moment. Those other sports have absolutely no relationship with betting or, therefore, the punter. ISPs (Internet Service Providers) will be forced under the new law to prevent access to illegal websites, supposedly 25000 in France currently used by 5% of the French punters.

In anticipation of the significant changes that are going to happen on the French market, we see a growing number of joint ventures being created these days between the media and big players in the gambling sector (Bwin with Amaury group, Betclick with Europe1, Unibet with RMC, Canalturf with France Television, etc).

In England, leading sports figures are pushing the government to modify gambling regulation, arguing that the recent European Court of Justice ruling opens the door for tougher regulation of bookmakers. According to The Guardian, "A delegation led by the England and Wales Cricket Board's chief executive, David Collier, including the British Horseracing Authority's chief executive, Nic Coward, the CCPR chief executive, Tim Lamb, and representatives from the Football Association and the Rugby Football Union, met the sports minister, Gerry Sutcliffe, yesterday to advance the case that all bookmakers should comply with rules forcing them to share match-fixing information and, potentially, contribute financially to fighting corruption. The stage is set for a debate between bookmakers and sports governing bodies as the government makes the issue a priority. Sutcliffe is understood to be keen to act."

1 commentaire:

Segoviano a dit…

Even though we are supposed to be within a single market where all EU consumers should have the right to choose their services provider, the truth is different in several economic sectors, the gambling one, amongst them.
Now it is Poland making noise about banning online gambling outright, before it was Sweden staunchly defending its national monopoly... And the list could go on...
Taking into account that national governments are mostly interested in their national interests and inflate the state budget, rather than in consumers choices, consumers are gathering and developing initiatives such as Right2bet aimed at guaranteeing the right of consumers to decide which betting operator they want regardless of the country where they are based on.
If you also believe in a truly open single European market, go to www.right2bet.net and sign the petition that will be presented to the European authorities.

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