EU Court of Justice rules that national gambling monopolies must be regulated in a consistent and systematic manner and that sanctions cannot discriminate between local and international providers

The ECJ confirmed in all cases its case law that EU member states have wide discretion to regulate their local markets by means of monopolies and to protect their citizens against risks associated with games of chance. As a consequence, they are not obliged to recognize licenses for the provision of games of chance granted by other member states. However, if they regulate games of chance by means of granting monopolies, they must do so in a manner proportionate to the public policy objectives pursued and in a non-discriminatory fashion.

That meant for the German cases that a sports betting monopolist should not be allowed to at the same time

- engage in advertising beyond what is necessary to channel consumers towards the monopolist’s offer by turning them away from other channels of unauthorized games, but instead encourage the propensity of consumers to gamble and to stimulate active participation in the latter for purposes of maximizing the anticipated revenue from such activities; and

- permit exploitation of other types of games of chance by private operators holding an authorization; while

- these privately exploited games present a higher potential risk of addiction than the games subject to the monopoly, and the authorities allow that supply to expand with a view to maximizing revenue from these games.

 In the Swedish case it meant that authorities are not allowed to discriminate in the sanctions applied to nationally established and cross border services for contravention of the prohibition to advertise games of chance that are not licensed in the member state. In the Swedish case the defendants alleged that the Swedish law imposed administrative sanctions on advertising an unlicensed game of chance from within Sweden, while criminal sanctions applied to advertising such games organized in another EU member state. In both cases it is now for the national courts to apply these rules to the cases before them. It is clear however that EU law, although it does not explicitly harmonize legislation on games of chance, imposes restrictions on the wide discretion member states think they enjoy to regulate games of chance. In particular member states will have to closely monitor if their rules are suitable for ensuring that the holder of the monopoly will in fact be able to pursue, in a consistent and systematic manner, the public policy objectives by means of a supply that is quantitatively measured and qualitatively planned by reference to the said objective and subject to strict control by the public authorities. These judgments show that although the EU respects national interests to protect consumers, the proportionality of the regulation to achieve that objective will be more and more closely scrutinized.

Erik Vollebregt

Greenberg Traurig, Amsterdam

PPA Calls on Congress to Put Americans’ Priorities First During Today’s House Financial Services Markup on Internet Poker Bill

Washington, DC (July 27, 2010) – John Pappas, Executive Director of the Poker Players Alliance (PPA), the leading poker grassroots advocacy group with more than one million members nationwide, released the following statement in advance of today's House Financial Services Committee markup on H.R. 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. 

Written by Amy Zupko

Woman Poker Player Magazine   

VANCOUVER, British Columbia, March 18, 2010 – Online casinos came on the scene right alongside the mainstream introduction of the internet. As people found a new way to communicate and do business, gamblers also found a new outlet.  Software originators such as Microgaming and Boss Media AB were formed in the mid 1990’s with Cryptologic being credited with developing the first interactive casino able to process real money financial transactions in 1996. Literally thousands followed suit until the market became saturated with online casinos. As the online gambling boom happened, global governments had a hard time keeping up with how to control the newly budding commerce.  It became apparent that the industry needed a medium to address issues and to present a unified front to lobby for regulation and to protect the industry.

The IGC has many roles in support of the gaming community including leading global lobbying efforts on behalf of its membership. The remarkable growth of internet gambling has many governments, most notably the United States debating suitable legislation, some suggesting an outright ban.