The European Union’s top court has issued an opinion that says Germany can’t prosecute unauthorized sports betting operators because the country’s gambling regulations run contrary to European law.
On Thursday, the Court of Justice for the European Union (CJEU) released an opinion by Advocate General Maciej Szpunar in the case of Sebat Ince, a Turkish national residing in Germany.
Ince ran a ‘Sportsbar’ which provided technology that allowed German bettors to connect with a Malta-licensed online betting operator. German authorities wanted to prosecute Ince for taking bets without a license but a Bavarian court asked the CJEU to rule whether the prosecution violated EU prohibitions on the restriction of trade.
Germany passed its federal interstate treaty on sports betting in 2012 and issued 20 online betting licenses in 2014 following a widely criticized application process. However, court challenges by rejected applicants have prevented the licenses from taking effect and the European Commission is currently considering whether to launch infringement proceedings against Germany due to its suspicion that the regime is incompatible with EU law.
Szpunar’s opinion can be read here, but in a nutshell, the ruling says Germany can’t prosecute private betting operators operating without a license because the chaotic and inscrutable tender process that capped the number of available licenses at 20 had failed to live up to EU standards of transparency.
A full ruling by the CJEU on Germany’s licensing regime is expected later this year. The German Sports Betting Association (DSWV) issued a statement saying it hoped Szpunar’s opinion would be enough to convince the German government to convene meetings with stakeholders to create a “fair and legally compliant” gambling regime.
Earlier this week, a court in the German state of Hesse rejected the appeal of an earlier ruling that prevented the issuance of those 20 sports betting licenses. The Hessian Administrative Court upheld a lower court’s ruling that the ‘Gambling College’ that was established to vet the license applicants represented neither the federal nor state governments, creating, in effect, a third unaccountable level of government that the court called a “breach of the principle of democracy.” Ouch.
The Hessian court also determined that this Gambling College had disproportionately favored German companies over equally qualified firms from other EU member states when it came to deciding who made up the lucky 20 license recipients. The Court concluded that Germany would be far better off forgetting the whole sordid episode and starting the process over from scratch. Amen.
Showing posts with label EU. Show all posts
Showing posts with label EU. Show all posts
October 23, 2015
September 29, 2014
CJEU confirms differentiated tax regime for Danish online gambling
The Court of Justice of the European Union (CJEU) has issued a ruling that confirms the differentiated Danish tax regime for online gambling in the country.
Applicants had challenged a decision by the European Commission to approve the Danish taxation model for online and offline gambling, which sets out two different taxation levels for the alternate types of gambling.
The Danish level of tax for online gaming was established after taking into account the need to channel consumers in the country towards regulated services.
However, the Court ruled that land-based applicants are not individually impacted by the tax regime.
The Court also confirmed that Member States are able to continue setting a tax level for online gambling that considers the competitive global internet market to ensure consumers are channelled to regulated services.
Maarten Haijer, secretary general of the European Gaming & Betting Association, said: “We welcome today’s decision of the Court confirming that the Commission correctly argued that online gambling requires a tax level that takes into account the competitiveness of the global online .com offer.
“With the unregulated offer just one click away on the internet, consumers will only play within the regulated environment if that offer is sufficiently attractive in terms of price and consumer experience.
“There are plenty examples of Member States where the regulated offer fails to attract consumers due to product restrictions and tax levels, resulting in those consumers being pushed outside the European regulatory umbrella, often to unregulated Asian offerings.”
Haijer added: “Having a restrictive market defeats the purpose of any regulation, namely ensuring proper consumer protection.
“An appropriate tax level is one of the key elements in creating an attractive and safe playing environment, albeit not the only one.
“It is important to emphasise that EGBA does not consider a differentiated tax regime as an objective in itself.
“But it is imperative that the tax level for online gambling is set at a level that allows for a competitive regulated market compared to the unlicensed offer from outside of the EU.”
Applicants had challenged a decision by the European Commission to approve the Danish taxation model for online and offline gambling, which sets out two different taxation levels for the alternate types of gambling.
The Danish level of tax for online gaming was established after taking into account the need to channel consumers in the country towards regulated services.
However, the Court ruled that land-based applicants are not individually impacted by the tax regime.
The Court also confirmed that Member States are able to continue setting a tax level for online gambling that considers the competitive global internet market to ensure consumers are channelled to regulated services.
Maarten Haijer, secretary general of the European Gaming & Betting Association, said: “We welcome today’s decision of the Court confirming that the Commission correctly argued that online gambling requires a tax level that takes into account the competitiveness of the global online .com offer.
“With the unregulated offer just one click away on the internet, consumers will only play within the regulated environment if that offer is sufficiently attractive in terms of price and consumer experience.
“There are plenty examples of Member States where the regulated offer fails to attract consumers due to product restrictions and tax levels, resulting in those consumers being pushed outside the European regulatory umbrella, often to unregulated Asian offerings.”
Haijer added: “Having a restrictive market defeats the purpose of any regulation, namely ensuring proper consumer protection.
“An appropriate tax level is one of the key elements in creating an attractive and safe playing environment, albeit not the only one.
“It is important to emphasise that EGBA does not consider a differentiated tax regime as an objective in itself.
“But it is imperative that the tax level for online gambling is set at a level that allows for a competitive regulated market compared to the unlicensed offer from outside of the EU.”
September 26, 2014
General Court of the EU upholds the Danish tax regime for online gambling
The General Court of the EU issued a ruling at first instance in the Danish State aid case (and upheld the European Commission’s decision, confirming that the Danish regime instituting a lower tax for online gambling is compliant with EU state-aid rules.
In doing so, the Court found that the applicants did not demonstrate that they were directly and individually affected by the tax measure. As a result, Member States can adopt a differentiated tax regime for online gambling with the view to designing an attractive market that is able to compete in the international online gambling market.
It is worth noting that the judgment implicitly accepts the arguments put forward by the Danish government about the need to channel Danish consumers towards the regulated online gambling market. The Court limited itself to deciding whether the applicants, who are land-based gambling operators, were directly and individually affected by the Commission’s decision. In both cases, the Court reached the same conclusion:
“The applicant is therefore not individually concerned by the contested decision.”
This means that the implementation of an internationally competitive tax regime that is critical in safeguarding the public policy objectives pursued by the Danish Gambling Act 2012 is now clearly in compliance with EU law.
Clive Hawkswood, CEO of the RGA, stated that: “it is very encouraging to see that the EU judicial body upholds the Commission’s decision which recognises that tax regimes for online gambling cannot be considered in isolation and have to be viewed within the context of international competition. Although this decision relates solely to tax, we believe that a similar rationale should apply across the board to all aspects of online gambling regulations and that this can be done without undermining very legitimate public policy objectives, such as safeguarding consumers and keeping gambling crime-free. This ruling will undoubtedly help us make the case for workable and competitive licensing regimes as more and more EU Member States open and regulate their online gambling markets.”
In doing so, the Court found that the applicants did not demonstrate that they were directly and individually affected by the tax measure. As a result, Member States can adopt a differentiated tax regime for online gambling with the view to designing an attractive market that is able to compete in the international online gambling market.
It is worth noting that the judgment implicitly accepts the arguments put forward by the Danish government about the need to channel Danish consumers towards the regulated online gambling market. The Court limited itself to deciding whether the applicants, who are land-based gambling operators, were directly and individually affected by the Commission’s decision. In both cases, the Court reached the same conclusion:
“The applicant is therefore not individually concerned by the contested decision.”
This means that the implementation of an internationally competitive tax regime that is critical in safeguarding the public policy objectives pursued by the Danish Gambling Act 2012 is now clearly in compliance with EU law.
Clive Hawkswood, CEO of the RGA, stated that: “it is very encouraging to see that the EU judicial body upholds the Commission’s decision which recognises that tax regimes for online gambling cannot be considered in isolation and have to be viewed within the context of international competition. Although this decision relates solely to tax, we believe that a similar rationale should apply across the board to all aspects of online gambling regulations and that this can be done without undermining very legitimate public policy objectives, such as safeguarding consumers and keeping gambling crime-free. This ruling will undoubtedly help us make the case for workable and competitive licensing regimes as more and more EU Member States open and regulate their online gambling markets.”
June 13, 2014
European Court upholds German online gambling regulations
The European Court of Justice ruled on today that Germany’s strict regulation of online gambling was justified even if the regional state of Schleswig-Holstein had eased the rules for online gambling.
Digibet had taken the case to the European court as they had been blocked from offering online gambling in Germany and believed it to be unconstitutional as one stae allows online gambling so why not all of Germany.
“The 15 remaining states were not required to change their rules just because a single state had pursued a more liberal policy for a limited time,” the European court said in a statement.
Digibet had taken the case to the European court as they had been blocked from offering online gambling in Germany and believed it to be unconstitutional as one stae allows online gambling so why not all of Germany.
“The 15 remaining states were not required to change their rules just because a single state had pursued a more liberal policy for a limited time,” the European court said in a statement.
April 03, 2014
Digibet asks the EC to clarify German igaming laws
German sports betting market focused operator Digibet has asked the European Court of Justice to bring clarity to the German sports betting licensing procedure. The operator has brought fourth a case concerning German licensing procedure, stating it to be cumbersome and lacking in transparency, which has in turn affected its business practices.
Digibet are concern by the slow progress, of issuing licenses for the region and the inability of the government to set corporate guidelines and best practice for the governance of the sector.
German ministers have indicated that the first batch of licenses will be set for Q4 2014, it is unknown which operators will be granted permission to market igaming services in the region. Ministers have also not given specific details with regards to implementations of new laws which may affect the sector.
Digibet hope that the European Court of Justice may add pressure to the German policy makers on the issuing of igaming policy. The Q4 target has been thought of as being optimistic given the circumstances.
German focused operators are hoping for transparency in 2014, given the sporting significance of 2014, operators in the region will be hoping for less stringent policies that have affected igaming markets in other legislated European Jurisdictions
Digibet are concern by the slow progress, of issuing licenses for the region and the inability of the government to set corporate guidelines and best practice for the governance of the sector.
German ministers have indicated that the first batch of licenses will be set for Q4 2014, it is unknown which operators will be granted permission to market igaming services in the region. Ministers have also not given specific details with regards to implementations of new laws which may affect the sector.
Digibet hope that the European Court of Justice may add pressure to the German policy makers on the issuing of igaming policy. The Q4 target has been thought of as being optimistic given the circumstances.
German focused operators are hoping for transparency in 2014, given the sporting significance of 2014, operators in the region will be hoping for less stringent policies that have affected igaming markets in other legislated European Jurisdictions
February 10, 2014
Online gambler suing operator that has consequences for whole of EU
A gambler that lost €1,000,000 playing online casino games in Austria is suing the online operator based on the fact that the company operated in conflict to Austrian monopoly laws towards online gambling, hence the player says makes it illegal and wants his losses back.
The case has reached the Austrian Supreme Court (OGH) which asked for a revision of the entire national gambling legislation.
The court that heard the initial case has supported the claim by the player but was overruled by Austria’s Supreme Court which decided in favour of the online operator which claimed that the national gambling law established in Austria was a monopoly against European treaties on the free movement of services.
Because of the complexity of the case and rulings so far given the case has now gone to the European Court of Justice (ECJ) for further evaluations.
The conclusion and decision of the ECJ will have huge consequences should they favour the idea of gambling monopolies being against European rules.
With countries such as Belgium, Cyprus, Czech Republic, Lithuania, Poland, and Romania facing legal actions similar to those of Austria, not only this but should the gambler win his fight for compensation it would see thousands of other online gamblers going to court in those countries with similar laws as Austria.
The decision of the ECJ is crucial and a wake-up call for the EU to get a coherent and regulated law across the states to prevent this exploding into massive court cases.
The case has reached the Austrian Supreme Court (OGH) which asked for a revision of the entire national gambling legislation.
The court that heard the initial case has supported the claim by the player but was overruled by Austria’s Supreme Court which decided in favour of the online operator which claimed that the national gambling law established in Austria was a monopoly against European treaties on the free movement of services.
Because of the complexity of the case and rulings so far given the case has now gone to the European Court of Justice (ECJ) for further evaluations.
The conclusion and decision of the ECJ will have huge consequences should they favour the idea of gambling monopolies being against European rules.
With countries such as Belgium, Cyprus, Czech Republic, Lithuania, Poland, and Romania facing legal actions similar to those of Austria, not only this but should the gambler win his fight for compensation it would see thousands of other online gamblers going to court in those countries with similar laws as Austria.
The decision of the ECJ is crucial and a wake-up call for the EU to get a coherent and regulated law across the states to prevent this exploding into massive court cases.
September 19, 2013
European Lotteries President welcomes adoption of unfair operator principle
On Tuesday September 10 in Strasbourg, the European Parliament adopted with an overwhelming majority the online gambling report prepared by the Internal Market and Consumer Protection Committee.
While the report does not call for harmonization of the online gambling sector at EU level, it highlights the need for co-operation amongst member states and urges a high level of protection for consumers.
European Lotteries, the umbrella organization of national lottery operators, welcomed the European Parliament resolution that confirms the European Commission’s approach to not propose a sectoral harmonization directive for online gambling.
Friedrich Stickler, President of European Lotteries, commented: "The European Parliament has spoken out very clearly that a sectoral online gambling Directive is not desirable: gambling is not an ordinary economic activity. We are pleased that the threat for consumers from illegal gambling offerings is taken seriously. This Resolution takes a clear stance on the need for law enforcement at the national level and cooperation between the Member States: we welcome in particular the adoption of the ‘unfair operator principle’: online gambling companies that violate the laws of one Member State should lose their license in other Member States."
The texts adopted by the the European Parliament elaborated on 5 different topics: specific nature of the online gambling sector and consumer protection, compliance with EU law, administrative cooperation, money laundering and integrity of sports, but Bookmakers Review could not find any specific mention of the adoption of the so-called ‘unfair operator principle’.
If anything the European Parliament noted the need for more coherent EU policies in order to address the cross-border nature of online gambling.
European Lotteries also welcomed the European Parliament strong stance on the need for a broad set of measures to fight illegal operators, although we hope and believe MEPs do not consider illegal bookmakers licensed in the Isle of Man, a British Crown Dependency.
Earlier this year, while speaking during the CEO panel at the World Gaming Executive Summit, the President of European Lotteries labeled as 'illegal operator' SBOBET, an online bookmaker present in Asia and Europe with licenses in First Cagayan (Philippines) and the Isle of Man.
The sensation that day of July was that Mr Stickler considers illegal all online bookmakers based in offshore jurisdictions and that he would have probably bashed Gibraltar-licensed BWIN had the company's Co-CEO not been present in the same panel.
While the report does not call for harmonization of the online gambling sector at EU level, it highlights the need for co-operation amongst member states and urges a high level of protection for consumers.
European Lotteries, the umbrella organization of national lottery operators, welcomed the European Parliament resolution that confirms the European Commission’s approach to not propose a sectoral harmonization directive for online gambling.
Friedrich Stickler, President of European Lotteries, commented: "The European Parliament has spoken out very clearly that a sectoral online gambling Directive is not desirable: gambling is not an ordinary economic activity. We are pleased that the threat for consumers from illegal gambling offerings is taken seriously. This Resolution takes a clear stance on the need for law enforcement at the national level and cooperation between the Member States: we welcome in particular the adoption of the ‘unfair operator principle’: online gambling companies that violate the laws of one Member State should lose their license in other Member States."
The texts adopted by the the European Parliament elaborated on 5 different topics: specific nature of the online gambling sector and consumer protection, compliance with EU law, administrative cooperation, money laundering and integrity of sports, but Bookmakers Review could not find any specific mention of the adoption of the so-called ‘unfair operator principle’.
If anything the European Parliament noted the need for more coherent EU policies in order to address the cross-border nature of online gambling.
European Lotteries also welcomed the European Parliament strong stance on the need for a broad set of measures to fight illegal operators, although we hope and believe MEPs do not consider illegal bookmakers licensed in the Isle of Man, a British Crown Dependency.
Earlier this year, while speaking during the CEO panel at the World Gaming Executive Summit, the President of European Lotteries labeled as 'illegal operator' SBOBET, an online bookmaker present in Asia and Europe with licenses in First Cagayan (Philippines) and the Isle of Man.
The sensation that day of July was that Mr Stickler considers illegal all online bookmakers based in offshore jurisdictions and that he would have probably bashed Gibraltar-licensed BWIN had the company's Co-CEO not been present in the same panel.
January 24, 2013
Greece monopoly ruled illegal
OPAP’s gambling monopoly in Greece is close to the end of the road after the Court of Justice for the European Union (CJEU) ruled it illegal. The monopoly contravenes European Union (EU) law as it grants exclusive rights without serving the public interest by limiting the amount of betting opportunities, according to a court ruling this morning. The current case was one filed by Stanleybet, William Hill and Sportingbet, with the result sending OPAP’s share price sliding downwards on the Stoxx Europe 600 Index – 11 percent to €6.27 at the last check.
There is still breathing room for Greece and if they implement stricter controls to ensure consumer protection they will be allowed to preserve it. If that doesn’t happen then Greece will have to open up the market to allow firms from other EU countries to operate.
Immediate reaction to the ruling came from Sigrid Ligné, secretary general of the European Gaming and Betting Association, who stated: Given the factual setup of OPAP’s monopoly which clearly fails to meet the CJEU test we hardly expect effective control to be implemented in the future. Therefore, Greece should follow the Court’s clear advice to liberalise the market. The ruling is highly relevant and gives the EC yet more jurisprudence to put an end to non-compliant gambling policies across the EU.”
Ligne is hopeful this ruling will give way to more cases being investigated by the EU regarding other member states that contravene EU law.
“At this stage only the EC, as the Guardian of the Treaties, can restore legal security by acting directly on the many complaints it has received, not only against Greece, but also against many other Member States. The EC can now take firm action on all pending infringement cases in order to ensure all Member States are in full compliance,” she added.
There is still breathing room for Greece and if they implement stricter controls to ensure consumer protection they will be allowed to preserve it. If that doesn’t happen then Greece will have to open up the market to allow firms from other EU countries to operate.
Immediate reaction to the ruling came from Sigrid Ligné, secretary general of the European Gaming and Betting Association, who stated: Given the factual setup of OPAP’s monopoly which clearly fails to meet the CJEU test we hardly expect effective control to be implemented in the future. Therefore, Greece should follow the Court’s clear advice to liberalise the market. The ruling is highly relevant and gives the EC yet more jurisprudence to put an end to non-compliant gambling policies across the EU.”
Ligne is hopeful this ruling will give way to more cases being investigated by the EU regarding other member states that contravene EU law.
“At this stage only the EC, as the Guardian of the Treaties, can restore legal security by acting directly on the many complaints it has received, not only against Greece, but also against many other Member States. The EC can now take firm action on all pending infringement cases in order to ensure all Member States are in full compliance,” she added.
October 23, 2012
EU Weighs Money-Laundering Curbs in Online Gambling Action Plan
The European Union may toughen safeguards against money laundering through online betting sites and promote hotlines against match fixing as part of a push to boost protection of gamblers and counter fraud.
The European Commission will also speed up probes into whether national restrictions on online gambling firms are legal in a bid to clarify market-access rules for the industry, according to an EU official.
The measures will be included in an action plan for the online gaming and betting industry to be published tomorrow by Michel Barnier, the EU’s financial services chief, said the official, who asked not to be identified because the plans aren’t yet public.
The EU’s top court in recent years has examined a series of cases brought by betting companies including Bwin.Party digital entertainment Plc, Ladbrokes Plc and Betfair Ltd. over whether it is legal for state monopolies to block them from operating freely across the 27-nation region. Online gambling firms have also called on the EU to take action against what they say are unjustified national restrictions on cross-border gambling.
Since 2006, the Brussels-based commission has probed whether national rules in states such as Germany, France and Italy comply with EU laws. Many investigations are ongoing.
The Brussels-based commission has received complaints about market-access curbs in 20 EU nations, the official said.
Nations tend to justify the curbs on the basis that they are needed to protect citizens from gambling addiction and to prevent crime.
Barnier has said that any moves at EU level to remove market barriers mustn’t harm these consumer protection and law enforcement objectives.
The commission has considered and rejected proposing legislation to clarify competition rules for the industry, the official said.
On money laundering, the commission will weigh whether to extend legislation for casinos to online gaming firms, the official said.
The law sets out identity checks and other monitoring that gaming companies must carry out on their customers. It also requires casinos to report suspicious activities to the authorities.
The European Commission will also speed up probes into whether national restrictions on online gambling firms are legal in a bid to clarify market-access rules for the industry, according to an EU official.
The measures will be included in an action plan for the online gaming and betting industry to be published tomorrow by Michel Barnier, the EU’s financial services chief, said the official, who asked not to be identified because the plans aren’t yet public.
The EU’s top court in recent years has examined a series of cases brought by betting companies including Bwin.Party digital entertainment Plc, Ladbrokes Plc and Betfair Ltd. over whether it is legal for state monopolies to block them from operating freely across the 27-nation region. Online gambling firms have also called on the EU to take action against what they say are unjustified national restrictions on cross-border gambling.
Since 2006, the Brussels-based commission has probed whether national rules in states such as Germany, France and Italy comply with EU laws. Many investigations are ongoing.
The Brussels-based commission has received complaints about market-access curbs in 20 EU nations, the official said.
Nations tend to justify the curbs on the basis that they are needed to protect citizens from gambling addiction and to prevent crime.
Barnier has said that any moves at EU level to remove market barriers mustn’t harm these consumer protection and law enforcement objectives.
The commission has considered and rejected proposing legislation to clarify competition rules for the industry, the official said.
On money laundering, the commission will weigh whether to extend legislation for casinos to online gaming firms, the official said.
The law sets out identity checks and other monitoring that gaming companies must carry out on their customers. It also requires casinos to report suspicious activities to the authorities.
September 27, 2012
Greece offers more OPAP to get privatizations on track
Greece will sell almost all of its stake in gambling monopoly OPAP, the government said on Thursday, increasing the amount that is for sale in an attempt to convince foreign lenders that it is serious about selling off state assets.
Athens, which owns 34 percent of one of Europe's biggest gaming companies, has launched a tender to sell a 33 percent stake in the company, the privatization agency HRADF said. Previously Greece had planned to sell 29 percent of OPAP, currently worth about 450 million euros on the Athens bourse.
OPAP is central to Greece's plan to raise 19 billion euros from privatizations by 2015 - a key condition of its 130-billion euro bailout agreed earlier this year. It is the country's most profitable state firm with a sports betting monopoly stretching, for some games, as far as 2030.
Greece is badly behind on privatization targets and the three-month-old, conservative-led government has pledged to do better as it struggles to convince the EU and the IMF to resume the bailout payments that keep the country afloat.
"The fact that OPAP is being completely sold off shows the government's will to privatize," said Dimitris Mardas, an economics professor at Thessaloniki's Aristotle University.
HRADF set an October 19 deadline for expressions of interest and said the tender would be carried out in two phases. After an initial declaration of interest, bidders will be called to submit binding offers, HRADF said. The agency has the right to introduce an intermediary phase of non-binding bids in order to evaluate bidders' business plans.
"The complete privatization of OPAP will be carried out transparently, rapidly and with efficiency," HRADF's chief executive Yiannis Emiris said in the statement.
A senior government official told Reuters earlier this month that Athens aimed to find a buyer for OPAP by January and that four consortia of Greek and foreign companies were interested in the company.
Turkish conglomerate Dogan Holding said on Monday it would consider taking part in a sale tender for OPAP. Investment funds Fidelity and Silchester Inv. already hold 5 percent each in the company.
Greece has picked Deutsche Bank and National Bank of Greece as financial advisers, it added.
Athens has already moved to clear issues that might block the company's sale. Earlier this month, it settled a row with European Union competition authorities over how the company should be taxed and set a new 30 percent levy on gross earnings from next year.
But investors' appetites might be dampened by an ongoing court challenge against the Greek company's monopoly brought by Britain's biggest bookmaker William Hill and online gaming companies Sportingbet and Stanleybet after they were denied gambling licenses in the country.
A senior EU legal adviser raised questions about OPAP's right to control all betting in the country last week. Greece's highest administrative court is expected to issue a final ruling on the case in the coming months.
September 18, 2012
Parliament mulls EU laws to fight organised crime in sport
Plans for an EU-wide legal approach to match-fixing and money laundering in sport are under way, with the European Parliament committee on mafia and organised crime holding a debate on the issue yesterday (17 September).
“Match-fixing might seem like a minor issue, but it is a serious problem in Europe” said Emine Bozkurt, an MEP (S&D) and author of a study on match-fixing and corruption in sport. “It is a form of crime with high revenues and excessively low sentences and detection rates.”
The complexity of sporting finances and illegal online betting rings offer ideal avenues for money laundering, with amounts running into the tens of millions of euros. However, the majority of member states do not have a definition of this type of fraud and match-fixing in criminal law.
Some countries have have minimum fines as low as €100 and maximum prison sentences as low as four years for those convicted.
European football’s governing body, UEFA, says it has undertaken official investigations in 19 of the 27 member states and four candidate countries.
The report by Bozkurt said "strong ties have been detected between the football establishment and criminal organisations, especially in Eastern Europe and the Balkans."
A study by the Institut de Relations Internationales et Stratégiques said that in countries such as Russia, Ukraine, Bulgaria and Serbia, criminals have infiltrated the clubs and federations and operate from within, while using the clubs as covers for a number of criminal activities.
Bozkurt said sport presented a “permanent risk of corruption”, due to little regulation, a vast network of online betting markets, and direct links with organised crime. Furthermore, because of the disparity in criminal sentences between member states, match-fixers habitually move their operations to those countries with the lower sentences.
State of play
Bozkurt and a number of organisations are calling for a cross-border approach to criminalise match-fixing, proposing an EU-wide legal framework as well as agreements amongst the main stakeholders to coordinate investigations.
A number of organisations have begun work to combat organised crime in sport, including the Council of Europe, which has drafted a convention on match-fixing, football’s worldwide governing body FIFA and Interpol, which agreed a €20 million partnership aimed at fighting the problem in Asia. Eurojust and Europol are also carrying out investigations.
Androulla Vassiliou, the commissioner responsible for culture and sport, said her cabinet was asking for EU funds under the 2014-2020 budget to combat “international threats to sport”, including match-fixing.
Bozkurt suggested the European Commission play a role in coordinating the different stakeholders and provide a platform for discussion. She also urged member states to include a harmonised definition of match-fixing in criminal law and impose sanctions for match-fixing including fines and confiscation.
This month, Michel Barnier, commissioner for the single market, announced the publication of an action plan to discuss "How to regulate betting and gambling in Europe".
Sporting integrity
The parliament debate follows the news this week that Antonio Conte, coach of Italian football club Juventus, has had his ban extended for failing to report fixing during a spell at Siena in 2010-11.
This was not the only high-profile case involving fixing over the past few months. This summer, authorities arrested 11 footballers in Italy, some in connection with bribes of about €600,000 to fix the result of a top division game between Lazio and Lecce. Matches have also been rigged in Belgium (Ye case), Germany (Hoyzer and Bochum case) and Finland (Tampere case).
Last year Pakistani cricketer Mohammad Asif served six months in a British prison for his part in a fixing scam. A number of other cricketers had also been sentenced following the scandal.
Some commentators are calling these high-profile cases just the ‘tip of the ice-berg.’
“Match-fixing might seem like a minor issue, but it is a serious problem in Europe” said Emine Bozkurt, an MEP (S&D) and author of a study on match-fixing and corruption in sport. “It is a form of crime with high revenues and excessively low sentences and detection rates.”
The complexity of sporting finances and illegal online betting rings offer ideal avenues for money laundering, with amounts running into the tens of millions of euros. However, the majority of member states do not have a definition of this type of fraud and match-fixing in criminal law.
Some countries have have minimum fines as low as €100 and maximum prison sentences as low as four years for those convicted.
European football’s governing body, UEFA, says it has undertaken official investigations in 19 of the 27 member states and four candidate countries.
The report by Bozkurt said "strong ties have been detected between the football establishment and criminal organisations, especially in Eastern Europe and the Balkans."
A study by the Institut de Relations Internationales et Stratégiques said that in countries such as Russia, Ukraine, Bulgaria and Serbia, criminals have infiltrated the clubs and federations and operate from within, while using the clubs as covers for a number of criminal activities.
Bozkurt said sport presented a “permanent risk of corruption”, due to little regulation, a vast network of online betting markets, and direct links with organised crime. Furthermore, because of the disparity in criminal sentences between member states, match-fixers habitually move their operations to those countries with the lower sentences.
State of play
Bozkurt and a number of organisations are calling for a cross-border approach to criminalise match-fixing, proposing an EU-wide legal framework as well as agreements amongst the main stakeholders to coordinate investigations.
A number of organisations have begun work to combat organised crime in sport, including the Council of Europe, which has drafted a convention on match-fixing, football’s worldwide governing body FIFA and Interpol, which agreed a €20 million partnership aimed at fighting the problem in Asia. Eurojust and Europol are also carrying out investigations.
Androulla Vassiliou, the commissioner responsible for culture and sport, said her cabinet was asking for EU funds under the 2014-2020 budget to combat “international threats to sport”, including match-fixing.
Bozkurt suggested the European Commission play a role in coordinating the different stakeholders and provide a platform for discussion. She also urged member states to include a harmonised definition of match-fixing in criminal law and impose sanctions for match-fixing including fines and confiscation.
This month, Michel Barnier, commissioner for the single market, announced the publication of an action plan to discuss "How to regulate betting and gambling in Europe".
Sporting integrity
The parliament debate follows the news this week that Antonio Conte, coach of Italian football club Juventus, has had his ban extended for failing to report fixing during a spell at Siena in 2010-11.
This was not the only high-profile case involving fixing over the past few months. This summer, authorities arrested 11 footballers in Italy, some in connection with bribes of about €600,000 to fix the result of a top division game between Lazio and Lecce. Matches have also been rigged in Belgium (Ye case), Germany (Hoyzer and Bochum case) and Finland (Tampere case).
Last year Pakistani cricketer Mohammad Asif served six months in a British prison for his part in a fixing scam. A number of other cricketers had also been sentenced following the scandal.
Some commentators are calling these high-profile cases just the ‘tip of the ice-berg.’
March 20, 2012
Platini wants match-fixers criminalised
UEFA president Michel Platini on Thursday called for match-fixing to be criminalised in all European countries.
"Let's not accept the autonomy of sport to be an obstacle to intervention by public authorities," Platini told a Council of Europe conference of sports ministers.
"We have to deal with a real problem of a political order, therefore we will regulate it not only with the means (available) to sports federations."
Platini urged the states participating in the conference to "declare match fixing illegal". "Judicial and police cooperation between the European countries must be able to break the power of the criminals," he insisted.
The Council of Europe called for all nations to adopt similar stances towards match-fixing.
"A harmonization of norms and adoption of penal sanctions for sporting frauds will be necessary as there are only several countries that have such codes", Anne Brasseur of the Council of Europe Parliamentary Assembly told AFP.
Platini also noted that European teams "accumulated more than 1.6 billion euros ($ two billion) losses in 2010".
"At the same time, they (the clubs) have never gained so much money," he said, renewing his call for financial discipline in football.
Such a situation has shown a "fragility of the system that has converted some of these clubs into gigantic casinos," he said.
"Let's not accept the autonomy of sport to be an obstacle to intervention by public authorities," Platini told a Council of Europe conference of sports ministers.
"We have to deal with a real problem of a political order, therefore we will regulate it not only with the means (available) to sports federations."
Platini urged the states participating in the conference to "declare match fixing illegal". "Judicial and police cooperation between the European countries must be able to break the power of the criminals," he insisted.
The Council of Europe called for all nations to adopt similar stances towards match-fixing.
"A harmonization of norms and adoption of penal sanctions for sporting frauds will be necessary as there are only several countries that have such codes", Anne Brasseur of the Council of Europe Parliamentary Assembly told AFP.
Platini also noted that European teams "accumulated more than 1.6 billion euros ($ two billion) losses in 2010".
"At the same time, they (the clubs) have never gained so much money," he said, renewing his call for financial discipline in football.
Such a situation has shown a "fragility of the system that has converted some of these clubs into gigantic casinos," he said.
October 12, 2010
EC: Romanian draft egaming law is uncompliant
The European Commission (EC) has expressed doubts about the compatibility of draft Romanian egaming legislation with EU law, which means that Romania cannot implement the legislation in its current form.
According to the European Gaming and Betting Association (EGBA), which campaigns for a single European egaming market, a number of provisions in the draft were unlikely to comply with EU law, including: “[T]he discriminatory prohibition of marketing and advertising activities for EU-licensed companies which are not authorised in Romania”; the requirement for EU licensed online betting companies to be established and have their servers in Romania; and “the unjustified exclusion of online pool betting while all other forms of online gambling would be allowed.”
Sigrid Ligné, secretary general of EGBA, said: “EGBA notes that Romania is the third country in the last 12 months to receive a detailed opinion from the European Commission and will have as in the case of Denmark and Poland to re-notify and adjust its draft legislation.
“While we support Romania’s legitimate wish to regulate its online gaming market, it is important from a consumer protection perspective that national gambling policies are consistent. As confirmed by the ECJ in its recent rulings, there are less restrictive means than forced establishment to monitor and control the online gaming and betting market.”
The Romanian draft legislation was notified to the European Commission and member states on 2 July. The opinion will extend the standstill period until 3 November. Romania will then have to amend the legislation according to the EC’s response.
According to the European Gaming and Betting Association (EGBA), which campaigns for a single European egaming market, a number of provisions in the draft were unlikely to comply with EU law, including: “[T]he discriminatory prohibition of marketing and advertising activities for EU-licensed companies which are not authorised in Romania”; the requirement for EU licensed online betting companies to be established and have their servers in Romania; and “the unjustified exclusion of online pool betting while all other forms of online gambling would be allowed.”
Sigrid Ligné, secretary general of EGBA, said: “EGBA notes that Romania is the third country in the last 12 months to receive a detailed opinion from the European Commission and will have as in the case of Denmark and Poland to re-notify and adjust its draft legislation.
“While we support Romania’s legitimate wish to regulate its online gaming market, it is important from a consumer protection perspective that national gambling policies are consistent. As confirmed by the ECJ in its recent rulings, there are less restrictive means than forced establishment to monitor and control the online gaming and betting market.”
The Romanian draft legislation was notified to the European Commission and member states on 2 July. The opinion will extend the standstill period until 3 November. Romania will then have to amend the legislation according to the EC’s response.
September 11, 2010
ECJ rules against Austrian gaming laws
The European Court of Justice (ECJ) has ruled that Austrian legislation requiring gaming operators to locate their seat in the country is not compliant with EU law.
In a judgement published yesterday, the ECJ found that “the obligation on persons holding concessions to operate gaming establishments to have their seat in Austria constitutes a restriction on freedom of establishment.”
Casinos Austria AG is currently the only company with permission from the Austrian Government to organise and operate gaming in the country, with 12 concessions granted and renewed without a public tender process.
The court said in its ruling that the absence of a competitive process allowing operators from other EU countries to apply for a casino license in the country “is contrary to the principle of equal treatment” and “constitutes indirect discrimination on grounds of nationality prohibited by EU law.”
Further, held the court, while restriction of operators located in other countries could be justified on the basis of “preventing those activities from being carried out for criminal or fraudulent purposes...the categorical exclusion of operators whose seat is in another Member State is disproportionate, as it goes beyond what is necessary to combat crime.”
The court was ruling on the questions raised by German national Ernst Engelmann on the compatibility of Austrian legislation on games of chance with freedom of establishment and freedom to provide services. This followed Engelmann appealing the decision of the Linz regional court of unlawfully organising games of chance after he operated two gaming establishments in Austria without having applied for a concession.
The ECJ judgement went on to say that in the absence of any transparency around the tender procedure, Austria’s grant of a concession to a local operator “constitutes difference in treatment to the detriment of operators located in other Member States, who have no real possibility of manifesting their interest in obtaining the concession in question.”
The court stated in its ruling that Austria had the choice of “various less restrictive measures” to monitor the activities and accounts of egaming operators located in other Member States.
Sigrid Ligné, secretary general of the European Gaming and Betting Association said: “Today’s ruling against the Austrian gambling laws confirms clearly that Member States cannot require EU licensed online operators to be physically present on their territory. In the Digital age there are obviously other and more efficient means available to monitor the activities of the operators.”
In a judgement published yesterday, the ECJ found that “the obligation on persons holding concessions to operate gaming establishments to have their seat in Austria constitutes a restriction on freedom of establishment.”
Casinos Austria AG is currently the only company with permission from the Austrian Government to organise and operate gaming in the country, with 12 concessions granted and renewed without a public tender process.
The court said in its ruling that the absence of a competitive process allowing operators from other EU countries to apply for a casino license in the country “is contrary to the principle of equal treatment” and “constitutes indirect discrimination on grounds of nationality prohibited by EU law.”
Further, held the court, while restriction of operators located in other countries could be justified on the basis of “preventing those activities from being carried out for criminal or fraudulent purposes...the categorical exclusion of operators whose seat is in another Member State is disproportionate, as it goes beyond what is necessary to combat crime.”
The court was ruling on the questions raised by German national Ernst Engelmann on the compatibility of Austrian legislation on games of chance with freedom of establishment and freedom to provide services. This followed Engelmann appealing the decision of the Linz regional court of unlawfully organising games of chance after he operated two gaming establishments in Austria without having applied for a concession.
The ECJ judgement went on to say that in the absence of any transparency around the tender procedure, Austria’s grant of a concession to a local operator “constitutes difference in treatment to the detriment of operators located in other Member States, who have no real possibility of manifesting their interest in obtaining the concession in question.”
The court stated in its ruling that Austria had the choice of “various less restrictive measures” to monitor the activities and accounts of egaming operators located in other Member States.
Sigrid Ligné, secretary general of the European Gaming and Betting Association said: “Today’s ruling against the Austrian gambling laws confirms clearly that Member States cannot require EU licensed online operators to be physically present on their territory. In the Digital age there are obviously other and more efficient means available to monitor the activities of the operators.”
February 12, 2010
Gambling monopoly in Greece to be broken by European Commission
There are a few nations that realized the overall benefits that can be reaped for the immense gambling industry, both on and off line. Greece is one such nation and has been trying to protect its carefully constructed gambling industry from foreign sources for a while now.
Greek gambling law is pretty basic and approves gambling in many forms, but only in casinos. There are about 20 casinos in Greece, most of which are located on some of the islands which serve as popular tourist destinations. In a nutshell, the gambling industry in Greece is intended more for visitors as a source of revenue from outside the country.
Lotteries and sportsbetting in Greece are strictly controlled by the company OPAP, one-third of which is owned by the government. They have an outstanding monopoly that has been running solid since 1958 but they have yet to offer an online sportsbook in Greece.
Generally, internet gambling in Greece is not very popular. Players must rely on foreign sites to play online, but the Greek government would rather not see this happening. It’s in their interest to protect the monopoly that’s currently in existence so that they can maximize their profits.
The European Commission has noticed that Greece has been protecting this monopoly in a subtle manner. They repeatedly reject bids for a license on behalf of companies like StanleyBet who would like to break onto the market. As a result, the EC may start to enforce EU internal market rules in Greece.
Greek gambling law is pretty basic and approves gambling in many forms, but only in casinos. There are about 20 casinos in Greece, most of which are located on some of the islands which serve as popular tourist destinations. In a nutshell, the gambling industry in Greece is intended more for visitors as a source of revenue from outside the country.
Lotteries and sportsbetting in Greece are strictly controlled by the company OPAP, one-third of which is owned by the government. They have an outstanding monopoly that has been running solid since 1958 but they have yet to offer an online sportsbook in Greece.
Generally, internet gambling in Greece is not very popular. Players must rely on foreign sites to play online, but the Greek government would rather not see this happening. It’s in their interest to protect the monopoly that’s currently in existence so that they can maximize their profits.
The European Commission has noticed that Greece has been protecting this monopoly in a subtle manner. They repeatedly reject bids for a license on behalf of companies like StanleyBet who would like to break onto the market. As a result, the EC may start to enforce EU internal market rules in Greece.
January 05, 2010
Belgium becomes latest to ignore EU online gambling agreements
Many countries are making their own laws regarding online gambling and are ignoring European Union trade agreements in the process. The latest to do so is Belgium, where lawmakers have inked new laws in an effort to regulate online gambling in the country.
Belgium lawmakers felt that the current Internet gambling system was being corrupted by organized crime. They believe that regulations would keep the crime out of the industry, but what they have come up with is in direct violation of EU agreements.
The European Union warned Belgium in a letter back in June of last year that these new laws would be a violation. Belgium, however, ignored the warning, and created new regulatory laws to oversee Internet gambling, more specifically, online poker.
Some of the top online poker players in the world reside in Belgium. With the new laws in place, major poker sites such as PartyPoker, Full Tilt, and PokerStars, would not be permitted to accept players from Belgium. That means that the top players could only play while putting themselves at risk of arrest.
The EU has not been consistent in their upholding of agreements. While Belgium and France has been warned about their nationalization of online poker, other countries such as Italy have been permitted to regulate their online gambling industry.
The US, which is the biggest online gambling market in the world, has been in violation of EU agreements since they enacted the Unlawful Internet Gambling Enforcement Act back in late 2006. Lawmakers in the US, however, are in the process of attempting to overturn the UIGEA and set up a regulated Internet gambling industry in the country.
Belgium lawmakers felt that the current Internet gambling system was being corrupted by organized crime. They believe that regulations would keep the crime out of the industry, but what they have come up with is in direct violation of EU agreements.
The European Union warned Belgium in a letter back in June of last year that these new laws would be a violation. Belgium, however, ignored the warning, and created new regulatory laws to oversee Internet gambling, more specifically, online poker.
Some of the top online poker players in the world reside in Belgium. With the new laws in place, major poker sites such as PartyPoker, Full Tilt, and PokerStars, would not be permitted to accept players from Belgium. That means that the top players could only play while putting themselves at risk of arrest.
The EU has not been consistent in their upholding of agreements. While Belgium and France has been warned about their nationalization of online poker, other countries such as Italy have been permitted to regulate their online gambling industry.
The US, which is the biggest online gambling market in the world, has been in violation of EU agreements since they enacted the Unlawful Internet Gambling Enforcement Act back in late 2006. Lawmakers in the US, however, are in the process of attempting to overturn the UIGEA and set up a regulated Internet gambling industry in the country.
November 12, 2009
Betfair and Ladbrokes take Dutch government to court
Betfair and Ladbrokes to take on the Dutch government tomorrow in two separate landmark legal battles at the EU’s highest court, the European Court of Justice (ECJ), over the right of offer egaming in the Netherlands.
For Betfair, the case follows a formal complaint made to the European Commission in May about a letter from the Dutch government to banks telling them to block payments from the British betting exchange’s Dutch customers, arguing that the letter was in breach of EU rules which allow companies authorised in one European Union member state to offer goods and services in any other.
If the case is successful, Betfair will also sue the Dutch government for damages that legal counsel Mark Warrington told EGRmagazine.com “will certainly run into millions.”
For Ladbrokes, the ECJ hearing will decide the fate of end of the British bookmaker’s seven-year struggle against an injunction imposed by Dutch courts that prevents Ladbrokes from accepting bets from Dutch citizens on Ladbrokes.com, which was referred to the ECJ in June.
Ladbrokes remote betting and gaming managing director John O’Reilly said: “Ladbrokes is a well regulated, licensed betting and gaming operator and under Article 49 of the Treaty on European Union our services should be accessible in other Member States.
“The injunction against Ladbrokes is aimed at protecting the revenues of the Dutch state monopoly sports betting provider and there is no justification for it in European Community law. It does not make sense that a Dutch citizen can cross the border into Belgium to place a bet in a Ladbrokes shop, yet we are banned from accepting bets from Dutch citizens online.”
As reported on EGRmagazine.com, however, in September the ECJ ruled against Bwin in favour of Portugal’s right to continue to favour state monopoly La Santa Casa da Misericordia (SCM), permitting states to protect state operators from competition if that decision is made to protect citizens from fraud or other crimes.
The decision led Ladbrokes to drop its five-year legal action against Norway’s state monopoly, although it also pledged to unite with other operators to fight other state monopolies across Europe.
The judgements in these two cases are not expected for 6-12 months.
For Betfair, the case follows a formal complaint made to the European Commission in May about a letter from the Dutch government to banks telling them to block payments from the British betting exchange’s Dutch customers, arguing that the letter was in breach of EU rules which allow companies authorised in one European Union member state to offer goods and services in any other.
If the case is successful, Betfair will also sue the Dutch government for damages that legal counsel Mark Warrington told EGRmagazine.com “will certainly run into millions.”
For Ladbrokes, the ECJ hearing will decide the fate of end of the British bookmaker’s seven-year struggle against an injunction imposed by Dutch courts that prevents Ladbrokes from accepting bets from Dutch citizens on Ladbrokes.com, which was referred to the ECJ in June.
Ladbrokes remote betting and gaming managing director John O’Reilly said: “Ladbrokes is a well regulated, licensed betting and gaming operator and under Article 49 of the Treaty on European Union our services should be accessible in other Member States.
“The injunction against Ladbrokes is aimed at protecting the revenues of the Dutch state monopoly sports betting provider and there is no justification for it in European Community law. It does not make sense that a Dutch citizen can cross the border into Belgium to place a bet in a Ladbrokes shop, yet we are banned from accepting bets from Dutch citizens online.”
As reported on EGRmagazine.com, however, in September the ECJ ruled against Bwin in favour of Portugal’s right to continue to favour state monopoly La Santa Casa da Misericordia (SCM), permitting states to protect state operators from competition if that decision is made to protect citizens from fraud or other crimes.
The decision led Ladbrokes to drop its five-year legal action against Norway’s state monopoly, although it also pledged to unite with other operators to fight other state monopolies across Europe.
The judgements in these two cases are not expected for 6-12 months.
Online gaming is driving spend in sports. But will the legislators derail the gravy train?
This season already, the gambling operator 188Bet.com has signed up as shirt sponsor of two Premier League clubs - Wigan Athletic and Bolton Wanderers - in north-west England, while 11 out of 16 Portuguese league clubs have BetClic emblazoned on their shirt-fronts this season.
This multiple sponsorship trend reflects a more general proliferation of gaming sector marketing around sport, and football, in particular… Real Madrid, AC Milan (Bwin) and Lyon (BetClic) are the continent’s market leaders in the promotion of gaming online and the likes of the German Bundesliga (Bwin) and the Australian A-League (Bet365) are among the best bets for combined live action and betting online.
It’s clear that the online gaming sector is no longer about fantasy revenue forecasts and stellar predictions. The amounts gambled online already scale the billions, while the sector represents a multi-million dollar marketing boon for sporting clubs and organisations.
Most importantly in these hard times, it’s a sector that is continuing to grow. According to Global Betting and Gaming Consultants (GBGC) global online gambling yield will increase by 25 per cent over on the next three years, with a significant proportion coming from global interest in football betting.
As Mike Falconer, chief executive of online gaming services firm, BettorLogic, reported in the SportBusiness International sister publication, iGaming Business, “Football has been almost singularly responsible for the steep progression of both Asian and newer [Southern and Eastern] European markets…and can account for 75 per cent - 80 per cent of bets taken in the major Asian countries.”
The 188Bet.com sponsorship of the two clubs in England’s north-west is a case in point, leveraging both local loyalties and the fame of the Premier League globally, especially in the gambling operator’s main market, Asia.
“The Premier League is and has been heavily broadcast globally and is increasing in a number of markets with several pending deals which will take it through pay-per-view to free-to-air in a number of markets,” said 188Bet CEO Andy Scott.
“So, that is a very strong attraction. It gives us a presence in our current markets as well as visibility in new markets."
It’s not only shirt sponsorship that is upping the ante for the gambling sector involvement in sport. 188Bet has signed two ‘official partnership’ agreements with Aston Villa and Chelsea, while Betfair, the leading betting exchange brand, has signed up for three years with current Premier League champions Manchester United.
Yet for clubs or organisations from jurisdictions in the United States or Europe where online gambling is banned or discouraged, such a close relationship between rights holder and gaming operator, may seem strange. And, it should be stressed that many European jurisdictions have yet to de-regulate the online gambling environment in the same way as the UK. But some European markets are catching up - and this is directly reflected in marketing activity. According to iGaming Business, the number of La Liga teams in Spain now sporting the logos of online operators are on a par with that of the UK in the early 2000s.
Similar growth is being witnessed in other EU countries such as Italy. In fact the biggest online gaming sponsorship deals in football are now in Spanish and Italian territories, where Austrian operator Bwin has set up landmark deals with Real Madrid and AC Milan. In the case of the Spanish giants, the sponsorship is thought to be worth around €45m over three years.
But changes to the law can’t come soon enough for Olympic Lyonnais. The French club was forced to start the new French football season without displaying the name of shirt sponsor BetClic, after the French football association rejected the club’s request to display the logo.
Then there is Portugal, once considered among the more accessible online gaming markets - and when BetClic signed up with 11 clubs in the top league for this season they gazumped Bwin which had title sponsored the entire national league from 2005-2008.
But in a move that will encourage other European governments to hold onto their gambling monopolies, the EU recently upheld the Portuguese government’s gambling restrictions as legal. The decision, which arose from a legal challenge brought by Bwin and the Portuguese League, could jeopardise the sponsorship contracts made by BetClic with the 11 Portuguese clubs.
Confusing? You bet. As is the situation Stateside, where the previous Bush administration passed a prohibitive anti-gaming law that has seen some online gaming operators jailed.
Although there are indicators that this legislation may change under the Democrats, any federally regulated online gambling system is likely to be fiercely protected and run by the major Nevada casinos.
Despite the unwanted attentions of government regulators, the online sector continues to grow its customer base - and now it has a new weapon in its marketing arsenal: live sports content. And the gaming sector’s relationship with sports rights is set to run and run. The depth of the relationship, however, will ultimately be determined by national legislators - and at this stage in the game, no one can predict with certainty how that particular story will pan out.
This multiple sponsorship trend reflects a more general proliferation of gaming sector marketing around sport, and football, in particular… Real Madrid, AC Milan (Bwin) and Lyon (BetClic) are the continent’s market leaders in the promotion of gaming online and the likes of the German Bundesliga (Bwin) and the Australian A-League (Bet365) are among the best bets for combined live action and betting online.
It’s clear that the online gaming sector is no longer about fantasy revenue forecasts and stellar predictions. The amounts gambled online already scale the billions, while the sector represents a multi-million dollar marketing boon for sporting clubs and organisations.
Most importantly in these hard times, it’s a sector that is continuing to grow. According to Global Betting and Gaming Consultants (GBGC) global online gambling yield will increase by 25 per cent over on the next three years, with a significant proportion coming from global interest in football betting.
As Mike Falconer, chief executive of online gaming services firm, BettorLogic, reported in the SportBusiness International sister publication, iGaming Business, “Football has been almost singularly responsible for the steep progression of both Asian and newer [Southern and Eastern] European markets…and can account for 75 per cent - 80 per cent of bets taken in the major Asian countries.”
The 188Bet.com sponsorship of the two clubs in England’s north-west is a case in point, leveraging both local loyalties and the fame of the Premier League globally, especially in the gambling operator’s main market, Asia.
“The Premier League is and has been heavily broadcast globally and is increasing in a number of markets with several pending deals which will take it through pay-per-view to free-to-air in a number of markets,” said 188Bet CEO Andy Scott.
“So, that is a very strong attraction. It gives us a presence in our current markets as well as visibility in new markets."
It’s not only shirt sponsorship that is upping the ante for the gambling sector involvement in sport. 188Bet has signed two ‘official partnership’ agreements with Aston Villa and Chelsea, while Betfair, the leading betting exchange brand, has signed up for three years with current Premier League champions Manchester United.
Yet for clubs or organisations from jurisdictions in the United States or Europe where online gambling is banned or discouraged, such a close relationship between rights holder and gaming operator, may seem strange. And, it should be stressed that many European jurisdictions have yet to de-regulate the online gambling environment in the same way as the UK. But some European markets are catching up - and this is directly reflected in marketing activity. According to iGaming Business, the number of La Liga teams in Spain now sporting the logos of online operators are on a par with that of the UK in the early 2000s.
Similar growth is being witnessed in other EU countries such as Italy. In fact the biggest online gaming sponsorship deals in football are now in Spanish and Italian territories, where Austrian operator Bwin has set up landmark deals with Real Madrid and AC Milan. In the case of the Spanish giants, the sponsorship is thought to be worth around €45m over three years.
But changes to the law can’t come soon enough for Olympic Lyonnais. The French club was forced to start the new French football season without displaying the name of shirt sponsor BetClic, after the French football association rejected the club’s request to display the logo.
Then there is Portugal, once considered among the more accessible online gaming markets - and when BetClic signed up with 11 clubs in the top league for this season they gazumped Bwin which had title sponsored the entire national league from 2005-2008.
But in a move that will encourage other European governments to hold onto their gambling monopolies, the EU recently upheld the Portuguese government’s gambling restrictions as legal. The decision, which arose from a legal challenge brought by Bwin and the Portuguese League, could jeopardise the sponsorship contracts made by BetClic with the 11 Portuguese clubs.
Confusing? You bet. As is the situation Stateside, where the previous Bush administration passed a prohibitive anti-gaming law that has seen some online gaming operators jailed.
Although there are indicators that this legislation may change under the Democrats, any federally regulated online gambling system is likely to be fiercely protected and run by the major Nevada casinos.
Despite the unwanted attentions of government regulators, the online sector continues to grow its customer base - and now it has a new weapon in its marketing arsenal: live sports content. And the gaming sector’s relationship with sports rights is set to run and run. The depth of the relationship, however, will ultimately be determined by national legislators - and at this stage in the game, no one can predict with certainty how that particular story will pan out.
March 27, 2009
EU Says U.S. Internet-Gambling Laws Break WTO Rules
A U.S. crackdown on European online gambling companies such as PartyGaming Plc and Sportingbet Plc is illegal and may justify a legal challenge at the World Trade Organization, the European Union said.
An investigation “found that U.S. laws on remote gambling and their enforcement against EU companies constitute an obstacle to trade that is inconsistent with WTO rules,” the European Commission said in a statement from Brussels today. “The provisional conclusions of the report imply that WTO proceedings against U.S. measures would be justified.”
The commission, acting on a complaint by European Internet gambling companies, says U.S. authorities targeted European businesses for operating gaming sites while failing to take action against domestic companies that offer similar services. The commission began its probe into the U.S. laws in March 2008.
The core of the industry complaint is that the U.S. Justice Department targets foreign Internet gambling owners -- and not domestic firms -- under U.S. legislation the WTO says violates international trade obligations. While the U.S. subsequently renounced those commitments and negotiated a settlement with the EU in December 2007, European companies are still subject to legal proceedings based on their past activities in the U.S. online gambling and betting market.
‘Positive News’
“Overall this is positive news for the industry as it’s another sign the EU is continuing with a reasonable approach on the issues surrounding the regulation of online gaming,” said Gavin Kelleher, lead analyst at online gambling consultancy H2 Gambling Capital.
Rather than going to the WTO immediately, the report “indicates that the issue should be addressed with the U.S. administration, with a view to finding a negotiated solution,” said the commission, the EU’s trade authority.
Many publicly traded European companies, including PartyGaming and 888 Holdings Plc, pulled out of the U.S. after Congress passed the 2006 Unlawful Internet Gambling Enforcement Act, but they face possible criminal prosecution for activities before then.
“The proceedings are continuing despite the withdrawal of European companies from the U.S. market in 2006 following changes in the U.S. regulatory framework,” the commission said. “The report comes to the conclusion that these proceedings are legally not justified and discriminatory.”
Concessions
Nefeterius McPherson, a spokeswoman for the U.S. Trade Representative’s office in Washington, said her agency and the Department of Justice “are studying the report and will discuss it with the European Commission.”
A WTO panel ruled against the U.S. ban on Internet gambling in November 2004 and an appellate body upheld that decision five months later. The U.S. then took the unusual step of going back and saying it never meant to make any pledges on gambling and was going to withdraw the issue from WTO jurisdiction. Other nations negotiated other concessions in return.
“Once this withdrawal occurs, the U.S. would no longer be obliged to guarantee future access to its gambling and betting market, but this does not mean it could disregard its obligations in respect of past trade,” the commission said.
The industry complaint was lodged mainly over the prosecution and threat of prosecution against EU operators while the U.S. commitments were in place, said Clive Hawkswood, chief executive officer of the Remote Gambling Association. “If the U.S. can give the EU some assurances it will no longer take action, then we’d be very happy,” he said.
Arrests
The EU is still investigating U.S. prosecutions of executives running Internet gambling sites. Sportingbet Chairman Peter Dicks was jailed in New York in September 2006 as part of an investigation into illegal gambling. David Carruthers, former head of Betonsports Plc, was arrested in Texas in July of that year and his company was barred from doing business in the U.S.
The arrests were part of the government crackdown on illegal online gambling in the U.S., where officials said Internet betting sites may launder money and sell drugs, and lack safeguards to screen out minors and gambling addicts.
U.S. laws have caused “serious adverse effects” for the EU including losses of revenue and stock-market value among companies that are absent from the U.S. market, the report says. In addition, “the threat of serious sanctions hanging over” these companies affects their activities outside the U.S. and there are knock-on effects on other sectors that supply the gambling industry, such as financial or professional services.
An investigation “found that U.S. laws on remote gambling and their enforcement against EU companies constitute an obstacle to trade that is inconsistent with WTO rules,” the European Commission said in a statement from Brussels today. “The provisional conclusions of the report imply that WTO proceedings against U.S. measures would be justified.”
The commission, acting on a complaint by European Internet gambling companies, says U.S. authorities targeted European businesses for operating gaming sites while failing to take action against domestic companies that offer similar services. The commission began its probe into the U.S. laws in March 2008.
The core of the industry complaint is that the U.S. Justice Department targets foreign Internet gambling owners -- and not domestic firms -- under U.S. legislation the WTO says violates international trade obligations. While the U.S. subsequently renounced those commitments and negotiated a settlement with the EU in December 2007, European companies are still subject to legal proceedings based on their past activities in the U.S. online gambling and betting market.
‘Positive News’
“Overall this is positive news for the industry as it’s another sign the EU is continuing with a reasonable approach on the issues surrounding the regulation of online gaming,” said Gavin Kelleher, lead analyst at online gambling consultancy H2 Gambling Capital.
Rather than going to the WTO immediately, the report “indicates that the issue should be addressed with the U.S. administration, with a view to finding a negotiated solution,” said the commission, the EU’s trade authority.
Many publicly traded European companies, including PartyGaming and 888 Holdings Plc, pulled out of the U.S. after Congress passed the 2006 Unlawful Internet Gambling Enforcement Act, but they face possible criminal prosecution for activities before then.
“The proceedings are continuing despite the withdrawal of European companies from the U.S. market in 2006 following changes in the U.S. regulatory framework,” the commission said. “The report comes to the conclusion that these proceedings are legally not justified and discriminatory.”
Concessions
Nefeterius McPherson, a spokeswoman for the U.S. Trade Representative’s office in Washington, said her agency and the Department of Justice “are studying the report and will discuss it with the European Commission.”
A WTO panel ruled against the U.S. ban on Internet gambling in November 2004 and an appellate body upheld that decision five months later. The U.S. then took the unusual step of going back and saying it never meant to make any pledges on gambling and was going to withdraw the issue from WTO jurisdiction. Other nations negotiated other concessions in return.
“Once this withdrawal occurs, the U.S. would no longer be obliged to guarantee future access to its gambling and betting market, but this does not mean it could disregard its obligations in respect of past trade,” the commission said.
The industry complaint was lodged mainly over the prosecution and threat of prosecution against EU operators while the U.S. commitments were in place, said Clive Hawkswood, chief executive officer of the Remote Gambling Association. “If the U.S. can give the EU some assurances it will no longer take action, then we’d be very happy,” he said.
Arrests
The EU is still investigating U.S. prosecutions of executives running Internet gambling sites. Sportingbet Chairman Peter Dicks was jailed in New York in September 2006 as part of an investigation into illegal gambling. David Carruthers, former head of Betonsports Plc, was arrested in Texas in July of that year and his company was barred from doing business in the U.S.
The arrests were part of the government crackdown on illegal online gambling in the U.S., where officials said Internet betting sites may launder money and sell drugs, and lack safeguards to screen out minors and gambling addicts.
U.S. laws have caused “serious adverse effects” for the EU including losses of revenue and stock-market value among companies that are absent from the U.S. market, the report says. In addition, “the threat of serious sanctions hanging over” these companies affects their activities outside the U.S. and there are knock-on effects on other sectors that supply the gambling industry, such as financial or professional services.
November 25, 2008
EU Member States may look to harmonise egaming regulation
EU Member States may be shifting their stance on online gaming and look to find a common approach to regulating the sector and in the process end years of deadlock when it comes to finding a harmonised EU-wide policy for the sector, according to Reuters.
A copy of the EU document obtained by the news agency stated: "While the legal frameworks differ, there are significant similarities in the member states' objectives as regards gambling and betting." European ministers will discuss the document on December 1, with some changes anticipated from states strongly opposed to any kind of opening of their gaming sector.
The issues that will be debated will include cooperation between national regulatory bodies to combat money laundering and fraud and corruption, a cap on pay-outs to players and an end to “double-taxation by taxing gaming where it takes place”.
France, currently holding the EU presidency, said there were “already grounds for seeking a common approach” back in July and French budget minister Eric Woerth recently said “Europe” may have to look at finding a regulatory solution for allowing the industry to work across borders and countries.
Others in the online gaming industry have interpreted this as a delaying tactic by the French, who are due to submit their draft regulation for the controlled opening of their online betting sector next month. But Sigrid Ligné, secretary general of the European Gaming and Betting Association, told Reuters: “In the end it's going to be back to the Commission to decide if it can take any further steps or if there is any need to do something new or different in the issue."
A dozen EU states are said to be supportive of the common approach to regulating in Europe although Britain and Malta were critical, Reuters said.
A copy of the EU document obtained by the news agency stated: "While the legal frameworks differ, there are significant similarities in the member states' objectives as regards gambling and betting." European ministers will discuss the document on December 1, with some changes anticipated from states strongly opposed to any kind of opening of their gaming sector.
The issues that will be debated will include cooperation between national regulatory bodies to combat money laundering and fraud and corruption, a cap on pay-outs to players and an end to “double-taxation by taxing gaming where it takes place”.
France, currently holding the EU presidency, said there were “already grounds for seeking a common approach” back in July and French budget minister Eric Woerth recently said “Europe” may have to look at finding a regulatory solution for allowing the industry to work across borders and countries.
Others in the online gaming industry have interpreted this as a delaying tactic by the French, who are due to submit their draft regulation for the controlled opening of their online betting sector next month. But Sigrid Ligné, secretary general of the European Gaming and Betting Association, told Reuters: “In the end it's going to be back to the Commission to decide if it can take any further steps or if there is any need to do something new or different in the issue."
A dozen EU states are said to be supportive of the common approach to regulating in Europe although Britain and Malta were critical, Reuters said.
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