European Gaming & Betting Association

Online gaming and betting: Belgian draft legislation rejected by European Commission

The European Gaming and Betting Association (EGBA) welcomes the European Commission’s detailed opinion against the Belgian proposal for online gaming and betting. The draft legislation is supposed to restrict the online gaming and betting market to operators solely established in Belgium.

Maarten Haijer, EGBA Director for Regulatory Affairs said: “The requirement for operators to be established in Belgium is one of the clearest violations of EC Treaty provisions. It wrongly denies that many online gaming operators are effectively regulated, licensed and controlled elsewhere in the EU. As several jurisdictions in the EU already prove, it is possible to guarantee a high level of consumer protection and have a well regulated and competitive online gaming and betting market at the same time. ”  The Belgian draft law was notified to the European Commission and the other Member States on 27 March 2009. A detailed legal analysis carried out on behalf of EGBA highlighted a number of issues highly doubtful under EC law, inter alia: 

• the requirement for operators to be established in Belgium;
• the unjustified limitation of the number of available licenses;
• the unjustified restrictions on the freedom to provide services, and;
• criminal sanctions on consumers wishing to play with EU licensed operators.    

This is the second detailed opinion from the Commission against recent draft legislation for online gaming and betting in a short period. On 8 June France received a detailed opinion against its proposed legislation because it also violates several Treaty provisions (see here). Both proposals seem to have in common that they view the online gaming and betting market on a strictly national level. Both Belgium and France also intend to introduce ISP blocking to prevent consumers playing with EU licensed and regulated operators.

France earlier already received a detailed opinion against that proposal as well (see here). “ISP blockings cannot impose territorial boundaries on the Internet. Experience shows that such restrictions are difficult to implement, easy to circumvent, inefficient and foster the growth of an underground market” Maarten Haijer added.     

Today’s detailed opinion extends the standstill period until 30 July 2009, during which time Belgium cannot adopt its draft legislation. Belgium is required to reply to the Commission’s views before adopting the legislation. If Belgium decides to adopt the current text without taking into account the Commission’s objections, the Commission can immediately launch infringement proceedings.

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For further information or comment please contact: Maarten Haijer: +32 (0) 2 2567527maarten.haijer@egba.eu

The EGBA is an association of leading European gaming and betting operators Bet-at-home.com, bwin, Digibet, Expekt, Interwetten, PartyGaming and Unibet. EGBA is a Brussels-based non-profit association. It promotes the right of private gaming and betting operators that are regulated and licensed in one Member State to a fair market access throughout the European Union. Online gaming and betting is a fast growing market, but will remain for the next decades a limited part of the overall European gaming market in which the traditional  land based offer is expected to grow from € 78,5 Billion GGR in 2008 to € 82 Billion GGR in 2012, thus keeping the lion’s share with 88,1% of the market. Source: H2 Gambling Capital, January 2009.

www.egba.eu

The Notification Procedure  

Under Directive 98/34/EC, Member States must notify to the Commission and other Member States draft regulations regarding products and Information Society services such as online gaming and betting, before adopting them. This procedure is aimed at preventing Member States from creating new barriers to the internal market freedoms by giving the opportunity to the Commission and Member States to evaluate the content of a draft law before it is adopted.

The notification of a text to the Commission opens a three month standstill period during which the draft text must not be adopted. This period allows the Commission and Member States to ascertain whether the draft text presents any unjustified barriers to the internal market. The Commission and/or Member States may then issue:

• a detailed opinion, if they consider that the draft text would, if implemented, create barriers to trade, services or establishment within the EU;
• comments, if they consider that the text raises issues of interpretation or requires further details; or
• no response, if they consider that the text is compatible with EU law.

Once a detailed opinion had been issued, the standstill period, during which the draft text must not be adopted, is extended by one month. If, after this time, the draft text is adopted without modification, the Commission can immediately commence an infringement procedure against the Member State’s newly adopted legislation. On 31 January 2008, the Commission launched an infringement procedure against Germany after it failed to respect the detailed opinion issued against it in March 2007: Link to Commission press release. 

To access the TRIS database and search for other draft laws see: http://ec.europa.eu/enterprise/tris/pisa/app/search/index.cfm?lang=EN

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