by Martin Arendts, M.B.L.-HSG
The Administrative Court of Giessen (Verwaltungsgericht Gießen) has reffered two more sports betting cases (interdiction orders against betting shops, tranferring bets to private bookmarks licensed in another EU member state) to the European Court of Justice (ECJ) according to Article 234 EC Treaty. Earlier this year, the court already reffered a similar case to the ECJ (Markus Stoß v Wetteraukreis; Case C-316/07).
The two new cases have been filed as:
Avalon Service-Online-Dienste GmbH v Wetteraukreis (Case C-409/07) and
Olaf Amadeus Wilhelm Happel v Wetteraukreis (Case C-410/07).
Now, seven German sports betting cases are pending before the ECJ (one from Cologne, three each from Stuttgart and Giessen). As the Administrative Courts of Giessen and Stuttgart asked quite similar questions, it is quite likely that the ECJ will join these cases. A decision will probably be announcend in two or three years.
The Administrative Court of Giessen asked the ECJ following questions:
Are Articles 43 and 49 EC to be interpreted as precluding a national monopoly on certain gaming, such as sports betting, where there is no consistent and systematic policy to limit gaming in the Member State concerned as a whole, in particular because the operators which have been granted a licence within that Member State encourage participation in other gaming - such as State-run lotteries and casino games - and, moreover, other games with the same or a higher suspected potential danger of addiction - such as betting on certain sporting events (e.g. horse racing) and slot machines - may be provided by private service providers?
Are Articles 43 and 49 EC to be interpreted as meaning that authorisations to operate sports betting, granted by State bodies specifically designated for that purpose by the Member States, which are not restricted to the particular national territory, entitle the holder of the authorisation and third parties appointed by it to make and implement offers to conclude contracts also in other Member States without any additional national authorisations being required?
16 November 2007
09 November 2007
Settlement agreement with sellers of Ongame frees bwin from payment of purchase price of EUR 79.9 million including interest
ad-hoc-release of bwin
In connection with the bwin Games transaction (formerly Ongame Group), bwin and the sellers agreed on a deferred consideration with a potential value of EUR 83.0 million including interest as of settlement date.
The introduction of the so-called "Safe Port Act", which also contained several provi-sions of the "Unlawful Internet Gambling Enforcement Act of 2006", effectively prohibited payment transactions in connection with online gaming in the United States. In response to this law, bwin suspended its real-money gaming operations for US customers in the autumn of 2006.
In spring this year, bwin entered into negotiations with the former majority shareholders of bwin Games, who sold 96.3% of the company's shares. bwin has now reached agreement with this group of sellers to the effect that they will waive the purchase price owed amounting to EUR 79.9 million including interest. bwin also intends to enter into talks with the other sellers with respect to the remaining amount of the deferred consideration of EUR 3.1 million.
In return for waiving this claim, this group of sellers will receive 28.89% of the net gaming revenues generated with US customers over a period of five years should bwin reintroduce real-money gaming products for US customers, albeit capped to EUR 79.9 million. Net gaming revenues are defined as the balance of betting stakes and customer winnings less all expenses, such as marketing costs, taxes and duties, commissions to third-party software providers for gaming applications and payment transaction costs, including chargebacks by US customers. Furthermore, the buyers will be released from all remaining lock-up obligations on the sale of the bwin shares which they received as part of the purchase price.
This agreement fully settles the bwin Games transaction with this group of sellers.
In connection with the bwin Games transaction (formerly Ongame Group), bwin and the sellers agreed on a deferred consideration with a potential value of EUR 83.0 million including interest as of settlement date.
The introduction of the so-called "Safe Port Act", which also contained several provi-sions of the "Unlawful Internet Gambling Enforcement Act of 2006", effectively prohibited payment transactions in connection with online gaming in the United States. In response to this law, bwin suspended its real-money gaming operations for US customers in the autumn of 2006.
In spring this year, bwin entered into negotiations with the former majority shareholders of bwin Games, who sold 96.3% of the company's shares. bwin has now reached agreement with this group of sellers to the effect that they will waive the purchase price owed amounting to EUR 79.9 million including interest. bwin also intends to enter into talks with the other sellers with respect to the remaining amount of the deferred consideration of EUR 3.1 million.
In return for waiving this claim, this group of sellers will receive 28.89% of the net gaming revenues generated with US customers over a period of five years should bwin reintroduce real-money gaming products for US customers, albeit capped to EUR 79.9 million. Net gaming revenues are defined as the balance of betting stakes and customer winnings less all expenses, such as marketing costs, taxes and duties, commissions to third-party software providers for gaming applications and payment transaction costs, including chargebacks by US customers. Furthermore, the buyers will be released from all remaining lock-up obligations on the sale of the bwin shares which they received as part of the purchase price.
This agreement fully settles the bwin Games transaction with this group of sellers.
26 October 2007
EGBA condemns detention of Unibet CEO and France’s disrespect of EU law
Following a European arrest warrant issued by the French authorities, Petter Nylander, CEO of Unibet, a European publicly listed company has been arrested in the Netherlands on 22 October 2007. The European Gaming and Betting Association, of which Unibet is a member, strongly disapproves this action.
The arrest comes at a time, when France’s legislation on gaming is being challenged both at EU and national level. These actions by French authorities completely disregard the European Commission’s Reasoned Opinion of June 2007, which underlined the disproportionality of threatening and imposing criminal sanctions on CEOs of sports betting companies licensed in the EU. The 2007 European Court of Justice’s verdict “Placanica” confirmed that criminal proceedings brought against legitimate operators based in other EU member states are in contradiction with the EU Treaty.
With a few days to go before the expiration of the deadline to answer the Reasoned Opinion, which has already been extended by two months to allegedly facilitate dialogue and solutions between all parties, the EGBA questions the objectives of the French government today. On the one hand, France has recently and repeatedly claimed its willingness to cooperate with the European Commission, while on the other hand it enforces the same criminal sanctions as one year ago. Norbert Teufelberger, chairman of EGBA, said: “History is repeating itself. Therefore, we now urge the European Commission to adopt swift measures against France. Petter Nylander has all the support of the EGBA, and we call on French and Dutch authorities to immediately end these disproportionate sanctions. ”
press release of EGBA
The arrest comes at a time, when France’s legislation on gaming is being challenged both at EU and national level. These actions by French authorities completely disregard the European Commission’s Reasoned Opinion of June 2007, which underlined the disproportionality of threatening and imposing criminal sanctions on CEOs of sports betting companies licensed in the EU. The 2007 European Court of Justice’s verdict “Placanica” confirmed that criminal proceedings brought against legitimate operators based in other EU member states are in contradiction with the EU Treaty.
With a few days to go before the expiration of the deadline to answer the Reasoned Opinion, which has already been extended by two months to allegedly facilitate dialogue and solutions between all parties, the EGBA questions the objectives of the French government today. On the one hand, France has recently and repeatedly claimed its willingness to cooperate with the European Commission, while on the other hand it enforces the same criminal sanctions as one year ago. Norbert Teufelberger, chairman of EGBA, said: “History is repeating itself. Therefore, we now urge the European Commission to adopt swift measures against France. Petter Nylander has all the support of the EGBA, and we call on French and Dutch authorities to immediately end these disproportionate sanctions. ”
press release of EGBA
Legal terms explained: interstate treaty (Staatsvertrag)
by Martin Arendts
In Germany, the new Interstate Treaty on Gambling (Glücksspielstaatsvertrag) shall replace the current Interstate Treaty on Lotteries (Lotteriestaatsvertrag) on 1 January 2008. Why does Germany not simply pass a Gambling Act?
In the Federal Republic of Germany, as is officially called, the 16 German states (Länder) and the federal state (Bund) have different jurisdictions. In the past, gambling and sports betting (with the exception of horse betting) has been regulated by the states (however, the Federal Constitutional Court expressly mentioned the possibility of a new regulation by the Federal Parliament, as sports betting has to be regarded as a business matter).
Matters, falling under the jurisdiction of the states, can be regulated not only by normal state acts, but also by interstate treaties. The idea behind an interstate treaty, that is a treaty between all 16 states, is is the creation of uniform law, without giving the jurisdiction to the federal state. Interstate treaties are quite common to regulate media matters, e.g. Interstate Treaty on Broadcasting (Rundfunkstaatsvertrag) and Interstate Treaty on Media Services (Mediendienste-Staatsvertrag). Interstate treaties have to be ratified by the state parliaments and are regarded as state law.
In Germany, the new Interstate Treaty on Gambling (Glücksspielstaatsvertrag) shall replace the current Interstate Treaty on Lotteries (Lotteriestaatsvertrag) on 1 January 2008. Why does Germany not simply pass a Gambling Act?
In the Federal Republic of Germany, as is officially called, the 16 German states (Länder) and the federal state (Bund) have different jurisdictions. In the past, gambling and sports betting (with the exception of horse betting) has been regulated by the states (however, the Federal Constitutional Court expressly mentioned the possibility of a new regulation by the Federal Parliament, as sports betting has to be regarded as a business matter).
Matters, falling under the jurisdiction of the states, can be regulated not only by normal state acts, but also by interstate treaties. The idea behind an interstate treaty, that is a treaty between all 16 states, is is the creation of uniform law, without giving the jurisdiction to the federal state. Interstate treaties are quite common to regulate media matters, e.g. Interstate Treaty on Broadcasting (Rundfunkstaatsvertrag) and Interstate Treaty on Media Services (Mediendienste-Staatsvertrag). Interstate treaties have to be ratified by the state parliaments and are regarded as state law.
24 October 2007
Three Referrals to the ECJ from the Administrative Court of Stuttgart
References for a preliminary ruling from the Verwaltungsgericht Stuttgart (Germany), lodged on 2 August 2007
(Case C-360/07)
Questions referred:
1. Are Articles 43 and 49 EC to be interpreted as precluding a national monopoly on certain gaming, such as sports betting and lotteries, where there is no consistent and systematic policy to limit gaming in the Member State concerned as a whole, because the operators which have been granted a licence within that Member State encourage and advertise participation in other gaming - such as State-run sports betting and lotteries - and, moreover, other games with the same or even higher potential danger of addiction - such as betting on certain sporting events (horse racing), slot machines and casino games - may be provided by private service providers?
2. Are Articles 43 and 49 EC to be interpreted as meaning that authorisations to operate sports betting, granted by the competent State bodies of the Member States, which are not restricted to the particular national territory, entitle the holder of the authorisation and third parties appointed by it to make and implement offers to conclude contracts in other Member States as well without any additional national authorisations being required?
Kulpa Automatenservice Asperg GmbH v Land Baden-Württemberg
(Case C-358/07)
SOBO Sport & Entertainment GmbH v Land Baden-Württemberg
(Case C-359/07)
(Case C-360/07)
Questions referred:
1. Are Articles 43 and 49 EC to be interpreted as precluding a national monopoly on certain gaming, such as sports betting and lotteries, where there is no consistent and systematic policy to limit gaming in the Member State concerned as a whole, because the operators which have been granted a licence within that Member State encourage and advertise participation in other gaming - such as State-run sports betting and lotteries - and, moreover, other games with the same or even higher potential danger of addiction - such as betting on certain sporting events (horse racing), slot machines and casino games - may be provided by private service providers?
2. Are Articles 43 and 49 EC to be interpreted as meaning that authorisations to operate sports betting, granted by the competent State bodies of the Member States, which are not restricted to the particular national territory, entitle the holder of the authorisation and third parties appointed by it to make and implement offers to conclude contracts in other Member States as well without any additional national authorisations being required?
Referral to the ECJ from the Administrative Court of Giessen
Reference for a preliminary ruling from the Verwaltungsgericht Giessen lodged on 9 July 2007 - Markus Stoß v Wetteraukreis
(Case C-316/07)
Questions referred:
Are Articles 43 and 49 EC to be interpreted as precluding a national monopoly on certain gaming, such as sports betting, where there is no consistent and systematic policy to limit gaming in the Member State concerned as a whole, in particular because the operators which have been granted a licence within that Member State encourage participation in other gaming - such as State-run lotteries and casino games - and, moreover, other games with the same or a higher suspected potential danger of addiction - such as betting on certain sporting events (e.g. horse racing) and slot machines - may be provided by private service providers?
Are Articles 43 and 49 EC to be interpreted as meaning that authorisations to operate sports betting, granted by State bodies specifically designated for that purpose by the Member States, which are not restricted to the particular national territory, entitle the holder of the authorisation and third parties appointed by it to make and implement offers to conclude contracts also in other Member States without any additional national authorisations being required?
(Case C-316/07)
Questions referred:
Are Articles 43 and 49 EC to be interpreted as precluding a national monopoly on certain gaming, such as sports betting, where there is no consistent and systematic policy to limit gaming in the Member State concerned as a whole, in particular because the operators which have been granted a licence within that Member State encourage participation in other gaming - such as State-run lotteries and casino games - and, moreover, other games with the same or a higher suspected potential danger of addiction - such as betting on certain sporting events (e.g. horse racing) and slot machines - may be provided by private service providers?
Are Articles 43 and 49 EC to be interpreted as meaning that authorisations to operate sports betting, granted by State bodies specifically designated for that purpose by the Member States, which are not restricted to the particular national territory, entitle the holder of the authorisation and third parties appointed by it to make and implement offers to conclude contracts also in other Member States without any additional national authorisations being required?
18 October 2007
bwin plans retail pilot project in Spain
The sports betting law that came into effect in the province of Madrid on 7 January this year permits and regulates the operation of retail betting shops based on the UK model.
bwin has been a prime sponsor of Real Madrid since 1 July this year, and has since dramatically increased its brand awareness in Spain. A pilot retail project is now being developed in Madrid in collaboration with Betbull Plc, an experienced betting shop operator in which bwin holds a strategic investment. The final licence application will be submitted to the authorities shortly, and the first betting shop under the bwin brand is scheduled to open in Madrid in the first quarter of 2008. The pilot project is intended to show the extent to which bwin's strong brand awareness can be successfully transferred to the retail sector. Details of financing will be published once the necessary licence has been issued.
press release of bwin, 18 October 2007
bwin has been a prime sponsor of Real Madrid since 1 July this year, and has since dramatically increased its brand awareness in Spain. A pilot retail project is now being developed in Madrid in collaboration with Betbull Plc, an experienced betting shop operator in which bwin holds a strategic investment. The final licence application will be submitted to the authorities shortly, and the first betting shop under the bwin brand is scheduled to open in Madrid in the first quarter of 2008. The pilot project is intended to show the extent to which bwin's strong brand awareness can be successfully transferred to the retail sector. Details of financing will be published once the necessary licence has been issued.
press release of bwin, 18 October 2007
13 September 2007
Betting licence procedures under tight EU scrutiny
The European Gaming and Betting Association (EGBA) welcomes the ruling of the European Court of Justice in the case (C-260/04) concerning the renewal of horse race betting licences in Italy which states that “the Italian Republic failed to fulfil its obligations under Articles 43 (freedom of establishment) and 49 (freedom to provide services) of the EC Treaty“. In particular, the Court found that „the Italian authorities infringed the general principle of transparency and the obligation to ensure a sufficent degree of advertising“. Today’s court decision is in line with previous ECJ rulings reached in the Gambelli and Placanica cases.
According to the ECJ, Italian authorities cannot restrict access to European operators simply for the purpose of guaranteeing “continuity, financial stability and a proper return on past investments for licence holders”. Moreover, the Italian argumentation failed to show how the renewal or maintenance of the old concessions without a tendering procedure would in any way help to prevent clandestine betting.
According to Sigrid Ligné, Secretary General of the EGBA: „The Court’s decision sends a clear signal to Member States currently offering, or planning to offer, licences to European gaming and betting operators. The Court clearly states that the licensing must be undertaken within a set of clear and strict parameters, which are in line with the EC treaty. The Court‘s decision also underlines that these licences cannot be awarded without a transparent, competitive and fair tendering procedure“.
The EGBA considers today’s ECJ ruling marks an important step towards a regulated European gaming and betting market and encourages Italy and other EU Member States to review their legislation.
press release EGBA, 13 September 2007
According to the ECJ, Italian authorities cannot restrict access to European operators simply for the purpose of guaranteeing “continuity, financial stability and a proper return on past investments for licence holders”. Moreover, the Italian argumentation failed to show how the renewal or maintenance of the old concessions without a tendering procedure would in any way help to prevent clandestine betting.
According to Sigrid Ligné, Secretary General of the EGBA: „The Court’s decision sends a clear signal to Member States currently offering, or planning to offer, licences to European gaming and betting operators. The Court clearly states that the licensing must be undertaken within a set of clear and strict parameters, which are in line with the EC treaty. The Court‘s decision also underlines that these licences cannot be awarded without a transparent, competitive and fair tendering procedure“.
The EGBA considers today’s ECJ ruling marks an important step towards a regulated European gaming and betting market and encourages Italy and other EU Member States to review their legislation.
press release EGBA, 13 September 2007
ATE and River City Group to Merge and Re-brand as Clarion Gaming
Following on the successful purchase of two key gaming industry event/publication companies by Clarion Events, a merger of those into a single entity called Clarion Gaming will begin in September 10, 2007 and be complete by early 2008.
ATE produces the major London exhibitions ICE and ICEi, along with The Betting Show and other conference events. In July 2006, ATE was joined by sister company, River City Group. Together we produce the European I-Gaming Congress and Expo (EiG) and BetMarkets. River City Group produces the Global Interactive Gaming Summit and Expo (GIGSE), World Poker Congress, Asian i-Gaming Congress (AiG, formerly PCIG) and I-Gaming InDepth conferences. In addition, both companies are responsible for key trade publications such as IGaming News, Betting Business, and Casino Review among others.
Simon Kimble, Managing Director of Clarion Events in London, said, "We made these two strategic purchases to get a foothold in serving the global gaming industry. We expect, as these two companies integrate, that they will form a dynamic foundation allowing us to assemble yet more key gaming industry event and publication companies in various regions of the world."
What does this mean for River City Group clients? Our staff and services will remain essentially the same and we plan to continue to offer the same trusted services to you as our readers, delegates, exhibitors and sponsors. This merger will allow us, and by extension, our clients, a broader reach as the lines between terrestrial and online gaming services continue to blur. We’ll be offering a combined suite of events and even more innovative digital information services so that you can best reach your markets.
Clarion Gaming, as the newly merged companies will be known, will espouse the same principles that have allowed River City Group and ATE to become the standard by which gaming companies gauge conferences and exhibitions serving their markets. Under this new moniker, we look forward to the opportunity to improve even further upon our new and established business relationships via the increased resources and reach of a shared identity and assets.
ATE produces the major London exhibitions ICE and ICEi, along with The Betting Show and other conference events. In July 2006, ATE was joined by sister company, River City Group. Together we produce the European I-Gaming Congress and Expo (EiG) and BetMarkets. River City Group produces the Global Interactive Gaming Summit and Expo (GIGSE), World Poker Congress, Asian i-Gaming Congress (AiG, formerly PCIG) and I-Gaming InDepth conferences. In addition, both companies are responsible for key trade publications such as IGaming News, Betting Business, and Casino Review among others.
Simon Kimble, Managing Director of Clarion Events in London, said, "We made these two strategic purchases to get a foothold in serving the global gaming industry. We expect, as these two companies integrate, that they will form a dynamic foundation allowing us to assemble yet more key gaming industry event and publication companies in various regions of the world."
What does this mean for River City Group clients? Our staff and services will remain essentially the same and we plan to continue to offer the same trusted services to you as our readers, delegates, exhibitors and sponsors. This merger will allow us, and by extension, our clients, a broader reach as the lines between terrestrial and online gaming services continue to blur. We’ll be offering a combined suite of events and even more innovative digital information services so that you can best reach your markets.
Clarion Gaming, as the newly merged companies will be known, will espouse the same principles that have allowed River City Group and ATE to become the standard by which gaming companies gauge conferences and exhibitions serving their markets. Under this new moniker, we look forward to the opportunity to improve even further upon our new and established business relationships via the increased resources and reach of a shared identity and assets.
21 August 2007
German Courts On Hold For ECJ Guidance
http://www.gamblingcompliance.com/
by James Kilsby
A High Court decision last week boosted the hopes of a number of private betting operators still facing charges brought by German authorities before early 2006 but a spectacular backlog of cases looks set to accumulate over the coming years as a third sports betting case is referred to the European Court of Justice.
Casual observers of the German gambling market could be forgiven for feeling as though understanding the legal situation surrounding sports betting in the country is a predicament that somehow corresponds to that faced by Josef K in Kafka’s ‘The Trial.’
In a non-fictional trial last week, however, Germany’s highest federal court expressed some sympathy for bookmakers who have been directly entangled in the uncertainty by upholding a regional court’s decision to dismiss charges brought against a bookmaker accused of operating illegal betting in the state of Saarland in 2003 and 2004. The High Court confirmed the assertion of the regional court that the bookmaker had committed an “inevitable error” due to the complexity and uncertainty surrounding the legal status of sports betting in Germany during the period in question.
According to leading German gaming lawyer Martin Arendts of the firm Arendts Anwalte, the decision is of great significance for other bookmakers still facing prosecution over their activities during the period up until the Constitutional Court verdict of March 2006 which sought to bring clarity to what was, as the High Court duly recognises, a muddled and constitutionally uncertain legal situation. Arendts suggests that the volume of cases that have continued to be brought since March 2006 means that the High Court’s latest clarification barely scratches the surface of the mountain of litigation involving bookmakers active in the German market.
“This is not such a big decision,” says Arendts. “It is relevant for the few hundred old cases from 2004 and 2005, but not for most of the cases that are currently pending before the German courts - and we have thousands of cases now.”
The fates of those thousands of cases could effectively be decided in Luxembourg rather than in Berlin or Munich as, despite the March 2006 ruling and the likely adoption of a new interstate gambling treaty in January 2008, German courts have begun to look to the European Court of Justice to determine the compatibility of German legislation with European Community law. A court in Stuttgart referred the third sports betting case from Germany to the ECJ in July, following courts in Gießen (May 2007) and Cologne (September 2006).
According to Arendts, the Stuttgart court seeks ECJ clarification on similar issues to its counterpart in Gießen in order to establish the rights of German authorities to prevent foreign bookmakers from offering their services within German and whether a sports betting monopoly (which would be maintained by the current draft interstate treaty) is legal under European law.
Despite the Federal High Court’s decision in Karlsruhe last week, it seems apparent that the number of pending cases in Germany is only set to grow whilst the referred cases await hearing in the ECJ. For example, Arendts says that courts in Stuttgart will await the ECJ’s decision before presiding over the 200 sports betting cases already filed in the state. If, as Arendts believes is possible, other state and Federal courts adopt the same ‘wait-and-see’ approach, uncertainty could continue to reign until the first German betting case is heard in the ECJ, an event that is unlikely to happen for 2 or 3 years at least. “We haven’t seen any new decisions since the latest referral but it might well change the attitude of a few of the courts,” Arendts says.
by James Kilsby
A High Court decision last week boosted the hopes of a number of private betting operators still facing charges brought by German authorities before early 2006 but a spectacular backlog of cases looks set to accumulate over the coming years as a third sports betting case is referred to the European Court of Justice.
Casual observers of the German gambling market could be forgiven for feeling as though understanding the legal situation surrounding sports betting in the country is a predicament that somehow corresponds to that faced by Josef K in Kafka’s ‘The Trial.’
In a non-fictional trial last week, however, Germany’s highest federal court expressed some sympathy for bookmakers who have been directly entangled in the uncertainty by upholding a regional court’s decision to dismiss charges brought against a bookmaker accused of operating illegal betting in the state of Saarland in 2003 and 2004. The High Court confirmed the assertion of the regional court that the bookmaker had committed an “inevitable error” due to the complexity and uncertainty surrounding the legal status of sports betting in Germany during the period in question.
According to leading German gaming lawyer Martin Arendts of the firm Arendts Anwalte, the decision is of great significance for other bookmakers still facing prosecution over their activities during the period up until the Constitutional Court verdict of March 2006 which sought to bring clarity to what was, as the High Court duly recognises, a muddled and constitutionally uncertain legal situation. Arendts suggests that the volume of cases that have continued to be brought since March 2006 means that the High Court’s latest clarification barely scratches the surface of the mountain of litigation involving bookmakers active in the German market.
“This is not such a big decision,” says Arendts. “It is relevant for the few hundred old cases from 2004 and 2005, but not for most of the cases that are currently pending before the German courts - and we have thousands of cases now.”
The fates of those thousands of cases could effectively be decided in Luxembourg rather than in Berlin or Munich as, despite the March 2006 ruling and the likely adoption of a new interstate gambling treaty in January 2008, German courts have begun to look to the European Court of Justice to determine the compatibility of German legislation with European Community law. A court in Stuttgart referred the third sports betting case from Germany to the ECJ in July, following courts in Gießen (May 2007) and Cologne (September 2006).
According to Arendts, the Stuttgart court seeks ECJ clarification on similar issues to its counterpart in Gießen in order to establish the rights of German authorities to prevent foreign bookmakers from offering their services within German and whether a sports betting monopoly (which would be maintained by the current draft interstate treaty) is legal under European law.
Despite the Federal High Court’s decision in Karlsruhe last week, it seems apparent that the number of pending cases in Germany is only set to grow whilst the referred cases await hearing in the ECJ. For example, Arendts says that courts in Stuttgart will await the ECJ’s decision before presiding over the 200 sports betting cases already filed in the state. If, as Arendts believes is possible, other state and Federal courts adopt the same ‘wait-and-see’ approach, uncertainty could continue to reign until the first German betting case is heard in the ECJ, an event that is unlikely to happen for 2 or 3 years at least. “We haven’t seen any new decisions since the latest referral but it might well change the attitude of a few of the courts,” Arendts says.
16 August 2007
bwin Video Webcast
bwin cordially invites you to participate in the online presentation following the publication of the second quarter and first half year of 2007. The presentation will be simultaneously transmitted in English.
Date: Thursday, 23 August 2007
Time: 9.30 - 9.45 a.m. CET (3.30 - 3.45 a.m. EST)
Webcast: www.bwin.ag
The presentation will be held by Norbert Teufelberger, Co-CEO of bwin.
N.B.: To participate via the Internet, you need Windows Media Player. Please remember to install the necessary software in time before transmission begins. (Download: Media Player®)
A recording of the Webcast will be available in German and English on the bwin Investor Relations website at www.bwin.ag and www.ots.at about one hour after the presentation has ended.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada) and Germany, Italy, Mexico, Argentinia, Austria and the United Kingdom, the Group has set itself the goal of becoming the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Bundesliga. The parent company bwin Interactive Entertainment AG has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). Further information about the Company can be found on its investor relations website at www.bwin.ag.
Date: Thursday, 23 August 2007
Time: 9.30 - 9.45 a.m. CET (3.30 - 3.45 a.m. EST)
Webcast: www.bwin.ag
The presentation will be held by Norbert Teufelberger, Co-CEO of bwin.
N.B.: To participate via the Internet, you need Windows Media Player. Please remember to install the necessary software in time before transmission begins. (Download: Media Player®)
A recording of the Webcast will be available in German and English on the bwin Investor Relations website at www.bwin.ag and www.ots.at about one hour after the presentation has ended.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada) and Germany, Italy, Mexico, Argentinia, Austria and the United Kingdom, the Group has set itself the goal of becoming the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Bundesliga. The parent company bwin Interactive Entertainment AG has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). Further information about the Company can be found on its investor relations website at www.bwin.ag.
23 July 2007
European Court of Justice decides on Euro Millions
by Martin Arendts, M.B.L.-HSG
After several cases on sports betting the European Court of Justice (ECJ) will, once again, decide on a lotteries case. A Belgian court, Rechtsbank van koophandel Hasselt, referred a case concerning the pan-European lottery Euro Millions to the ECJ (Case C-525/06, Nationale Lotterij). Plaintiff in the Belgian case is NV de Nationale Loterij, the monopoly operator in Belgium. The defendant is BVBA Customer Service Agency, which offers the participation as a group in Euro Millions.
The Belgian lottery monopoly has been justified by the public interest, mainly the prevention of squandering through gaming. The Belgian court somehow does not really seemed to be convinced by this reasoning. It referres to the fact that advertising in reality strenghens gaming compulsion and that Nationale Loterij is induced by the present system to maximise turnover. It also raises the question whether there are less obstructive measures than a monopoly, such as restriction of possible stakes and winnings.
Apart from that, the Belgian court, in its second question to the ECJ, asks whether a distribution company as the defendant can argue with the freedom to provide services. Especially this question is releveant for EU Member States where gaming monopoly products are (also) distributed by private companies (e.g. Germany which tries to ban any private distribution with the planned Interstate Treaty on Gambling, Glücksspielstaatsvertrag).
The ECJ will have to answer following questions, the Belgian court referred to Luxembourg:
1. Is Article 49 of the EC Treaty to be interpreted as meaning that restrictive national provisions, such as Article 37 of the Law of 19 April 2002, which obstruct the access to the market of an undertaking wishing to sell for profit group participation forms in Euro Millions, are still permitted having regard to the public interest (prevention of squandering through gaming), in the knowledge that:
(a) the Nationale Loterij, which acquired a statutory monopoly from the Belgian State and pays a monopoly rent for it and which has the objective of channelling man's inherent compulsion to gamble, regularly advertises participation in Euro Millions thereby in reality strengthening that compulsion;
(b) the regular advertising by Nationale Loterij and its sales methods have a foreclosure effect, in which the Nationale Loterij is induced to maximise turnover (financial reasons) rather than channel the citizens' inherent compulsion to gamble;
(c) less obstructive measures, such as restriction of possible stakes and winnings, would better achieve the objective pursued, namely the channelling of the inherent compulsion to gamble?
2. Is a restrictive national provision such as Article 37 of the Law of 19 April 2002, which prevents the access to the market of an undertaking intending to sell, for profit, group participation forms in Euro Millions, contrary to the freedom to provide services (Article 49 of the EC Treaty) where the defendant itself does not organise a lottery but in fact seeks to organise, for profit, merely participation as a group in Euro Millions via the Nationale Loterij's own participation forms?
After several cases on sports betting the European Court of Justice (ECJ) will, once again, decide on a lotteries case. A Belgian court, Rechtsbank van koophandel Hasselt, referred a case concerning the pan-European lottery Euro Millions to the ECJ (Case C-525/06, Nationale Lotterij). Plaintiff in the Belgian case is NV de Nationale Loterij, the monopoly operator in Belgium. The defendant is BVBA Customer Service Agency, which offers the participation as a group in Euro Millions.
The Belgian lottery monopoly has been justified by the public interest, mainly the prevention of squandering through gaming. The Belgian court somehow does not really seemed to be convinced by this reasoning. It referres to the fact that advertising in reality strenghens gaming compulsion and that Nationale Loterij is induced by the present system to maximise turnover. It also raises the question whether there are less obstructive measures than a monopoly, such as restriction of possible stakes and winnings.
Apart from that, the Belgian court, in its second question to the ECJ, asks whether a distribution company as the defendant can argue with the freedom to provide services. Especially this question is releveant for EU Member States where gaming monopoly products are (also) distributed by private companies (e.g. Germany which tries to ban any private distribution with the planned Interstate Treaty on Gambling, Glücksspielstaatsvertrag).
The ECJ will have to answer following questions, the Belgian court referred to Luxembourg:
1. Is Article 49 of the EC Treaty to be interpreted as meaning that restrictive national provisions, such as Article 37 of the Law of 19 April 2002, which obstruct the access to the market of an undertaking wishing to sell for profit group participation forms in Euro Millions, are still permitted having regard to the public interest (prevention of squandering through gaming), in the knowledge that:
(a) the Nationale Loterij, which acquired a statutory monopoly from the Belgian State and pays a monopoly rent for it and which has the objective of channelling man's inherent compulsion to gamble, regularly advertises participation in Euro Millions thereby in reality strengthening that compulsion;
(b) the regular advertising by Nationale Loterij and its sales methods have a foreclosure effect, in which the Nationale Loterij is induced to maximise turnover (financial reasons) rather than channel the citizens' inherent compulsion to gamble;
(c) less obstructive measures, such as restriction of possible stakes and winnings, would better achieve the objective pursued, namely the channelling of the inherent compulsion to gamble?
2. Is a restrictive national provision such as Article 37 of the Law of 19 April 2002, which prevents the access to the market of an undertaking intending to sell, for profit, group participation forms in Euro Millions, contrary to the freedom to provide services (Article 49 of the EC Treaty) where the defendant itself does not organise a lottery but in fact seeks to organise, for profit, merely participation as a group in Euro Millions via the Nationale Loterij's own participation forms?
11 July 2007
Germany Set For EU Showdown As Schleswig-Holstein Backs Controversial Interstate Treaty
by James Kilsby, www.gamingcompliance.com
In a move that will stun observers, the state government of Schleswig-Holstein has declared its intention to ratify the draft Interstate Lotteries Treaty, shelved since December 2006. According to one gaming lawyer, the move could lead to a “war” with the European Commission.
The Schleswig-Holstein cabinet yesterday authorised Prime Minister Peter Harry Cartensen to add his signature to the draft Interstate Lotteries Treaty. Cartensen had been the one state PM to refuse to sign the Treaty when it was debated in December 2006 by all sixteen state Prime Ministers, stating that Germany should instead wait for further guidance from Brussels before adopting new legislation on betting, as a Constitutional Court verdict from March 2006 requires it to by January 1, 2008.
The Treaty, in its current form, prohibits the use of the internet for all forms of gambling in Germany, with the exception of horserace betting, as well as extending the monopoly on lotteries and sports betting services to the state lottery companies cartelised into Deutscher Lotto- und Totoblock for a further four years, until 2012. The Treaty also obliges German financial institutions to block attempted online payments for gambling services.
What makes yesterday’s news all the more surprising, given Schleswig-Holstein’s reasoning at the end of last year, is that the European Commission has made abundantly clear that it considers the Treaty to be a blatant violation of EC law. The Commission has already sent Germany two letters in the form of Detailed Opinions. In the first letter in March, the Commission stated that it does not consider the proposed ban on the use of the internet to be “proportionate” to achieve stated aims of combating gambling addiction, nor consistent given the ban specifically excludes gambling on horseracing.
The Commission went further in its objections to the Treaty in the second Detailed Opinion sent to Germany in May. According to the Commission, not only is the Treaty non-compliant with European competition laws and against the principle of freedom of establishment enshrined in the Treaty of Rome, but it also violates laws protecting the free movement of capital with the Union and does not form part of coherent policy given that restrictions on advertising apply only to betting and not to slot machines.
The January 1, 2008 deadline set by the Constitutional Court means that the German gambling industry would enter a period of legal uncertainty were the Lander unable to reach a consensus and that uncertainty could affect the state’s ability to secure revenue from state lotteries and betting services to fund sports and other social programs. These concerns, combined with the entrenched position of other states in favour of a blanket extension of the state gambling monopolies, go some way to explaining the surprise decision taken by the Schleswig-Holstein cabinet yesterday. “There are at present no viable alternatives to securing revenue from gambling,” said Prime Minister Cartensen, explaining the decision.
“At the last conference of the German state Prime Ministers, Schleswig-Holstein suggested that, if it was the last state standing against the Treaty, it would be forced to sign it,” notes Martin Arendts, a leading German gaming lawyer with the firm Arendts Anwalte. “There have been doubts expressed by other state governments regarding the Treaty, by Baden-Wurttemberg in particular, but what Schleswig-Holstein had to do [to create an alternative solution] was to convince two or three other states to firmly oppose the Treaty – and it has definitely failed to do so.”
(...)
Presuming none of the other fifteen Lander have an even more dramatic change of heart on the gambling issue, and the draft Treaty is duly signed later this year, Germany can expect to find itself at loggerheads with the European Commission. “There were reports in the German magazine ‘Der Spiegel’ that the Commission was looking to reach some sort of compromise with Germany over betting but this is not a compromise; it’s a clash of opinions,” says Arendts. “It looks like there is going to be some sort of war between Germany and the European Commission - the European Commission has already said in its previous letters that there will definitely be another infringement proceeding if the draft Treaty is adopted.”
Although yesterday’s news can be considered progress towards the adoption of new legislation, the future of the industry has arguably never been less clear given the inevitability of legal challenges in both European and German courts. “Even the German civil servants responsible for drafting the Treaty concede there are problems with it given that casinos and slot machines will not be subject to same level of protection as betting and lotteries,” says Arendts. “If you look at the most recent EFTA Court decision on the case between Ladbrokes and the Norwegian government, the need for states to show consistency in their gaming policy as a whole is important – and there is definitely not a coherent policy in Germany.”
www.gamblingcompliance.com
In a move that will stun observers, the state government of Schleswig-Holstein has declared its intention to ratify the draft Interstate Lotteries Treaty, shelved since December 2006. According to one gaming lawyer, the move could lead to a “war” with the European Commission.
The Schleswig-Holstein cabinet yesterday authorised Prime Minister Peter Harry Cartensen to add his signature to the draft Interstate Lotteries Treaty. Cartensen had been the one state PM to refuse to sign the Treaty when it was debated in December 2006 by all sixteen state Prime Ministers, stating that Germany should instead wait for further guidance from Brussels before adopting new legislation on betting, as a Constitutional Court verdict from March 2006 requires it to by January 1, 2008.
The Treaty, in its current form, prohibits the use of the internet for all forms of gambling in Germany, with the exception of horserace betting, as well as extending the monopoly on lotteries and sports betting services to the state lottery companies cartelised into Deutscher Lotto- und Totoblock for a further four years, until 2012. The Treaty also obliges German financial institutions to block attempted online payments for gambling services.
What makes yesterday’s news all the more surprising, given Schleswig-Holstein’s reasoning at the end of last year, is that the European Commission has made abundantly clear that it considers the Treaty to be a blatant violation of EC law. The Commission has already sent Germany two letters in the form of Detailed Opinions. In the first letter in March, the Commission stated that it does not consider the proposed ban on the use of the internet to be “proportionate” to achieve stated aims of combating gambling addiction, nor consistent given the ban specifically excludes gambling on horseracing.
The Commission went further in its objections to the Treaty in the second Detailed Opinion sent to Germany in May. According to the Commission, not only is the Treaty non-compliant with European competition laws and against the principle of freedom of establishment enshrined in the Treaty of Rome, but it also violates laws protecting the free movement of capital with the Union and does not form part of coherent policy given that restrictions on advertising apply only to betting and not to slot machines.
The January 1, 2008 deadline set by the Constitutional Court means that the German gambling industry would enter a period of legal uncertainty were the Lander unable to reach a consensus and that uncertainty could affect the state’s ability to secure revenue from state lotteries and betting services to fund sports and other social programs. These concerns, combined with the entrenched position of other states in favour of a blanket extension of the state gambling monopolies, go some way to explaining the surprise decision taken by the Schleswig-Holstein cabinet yesterday. “There are at present no viable alternatives to securing revenue from gambling,” said Prime Minister Cartensen, explaining the decision.
“At the last conference of the German state Prime Ministers, Schleswig-Holstein suggested that, if it was the last state standing against the Treaty, it would be forced to sign it,” notes Martin Arendts, a leading German gaming lawyer with the firm Arendts Anwalte. “There have been doubts expressed by other state governments regarding the Treaty, by Baden-Wurttemberg in particular, but what Schleswig-Holstein had to do [to create an alternative solution] was to convince two or three other states to firmly oppose the Treaty – and it has definitely failed to do so.”
(...)
Presuming none of the other fifteen Lander have an even more dramatic change of heart on the gambling issue, and the draft Treaty is duly signed later this year, Germany can expect to find itself at loggerheads with the European Commission. “There were reports in the German magazine ‘Der Spiegel’ that the Commission was looking to reach some sort of compromise with Germany over betting but this is not a compromise; it’s a clash of opinions,” says Arendts. “It looks like there is going to be some sort of war between Germany and the European Commission - the European Commission has already said in its previous letters that there will definitely be another infringement proceeding if the draft Treaty is adopted.”
Although yesterday’s news can be considered progress towards the adoption of new legislation, the future of the industry has arguably never been less clear given the inevitability of legal challenges in both European and German courts. “Even the German civil servants responsible for drafting the Treaty concede there are problems with it given that casinos and slot machines will not be subject to same level of protection as betting and lotteries,” says Arendts. “If you look at the most recent EFTA Court decision on the case between Ladbrokes and the Norwegian government, the need for states to show consistency in their gaming policy as a whole is important – and there is definitely not a coherent policy in Germany.”
www.gamblingcompliance.com
04 July 2007
Talks between bwin and Sportingbet discontinued
Ad-hoc Release of bwin:
On 7th March 2007, bwin Interactive Entertainment AG announced that it was in preliminary discussions with the Board of Sportingbet plc about the possible acquisition of Sportingbet plc. Sportingbet plc has announced that these discussions have now been amicably discontinued.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
On 7th March 2007, bwin Interactive Entertainment AG announced that it was in preliminary discussions with the Board of Sportingbet plc about the possible acquisition of Sportingbet plc. Sportingbet plc has announced that these discussions have now been amicably discontinued.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
28 June 2007
First extensive medical research about online gambling
For the very first time researchers from the Harvard Medical School faculty from the Division on Addictions have been able to analyse the behaviour of online gamblers during their gambling activities.
The study has followed a sample of more than 40.000 individual online gamblers over a period of 8 months. It is the first time ever that such a large investigation is based on the actual online gaming behaviour rather than on self-reports. This has been made possible due to the collaboration with the private online operator and EGBA member bwin that has opened its data centre to the researchers of Harvard Medical School. The first publication of this ongoing research study can be found under http://www.divisiononaddictions.org/html/library.htm.
Preliminary results of this ongoing study have been presented by Drs. Howard Shaffer and Richard LaBrie of Havard Medical School at a workshop hosted by EGBA in which leading experts in the field of gaming, addiction and social responsibility took part. "Addiction has on many occasions been raised as one of the concerns associated with gambling related activites. Our intensive research reveals that many different elements contribute to the fact that only a very small proportion of people experience gambling addiction, whether online or with traditional forms of gambling. Moreover, the most striking result of this research shows that the assumption of a typical gambler being somebody out of control is fundamentally wrong. This data shows that a typical online gambler risks 148€ and has a loss of about 33€ during a period of 8 months" according to professor Howard J. Shaffer, head of this research project.
"We are very pleased that one of our members, bwin, has been willing to contribute to such an important scientific project. This study and its first results bring some important insight to the behavioural aspects and helps us all better understand what possible problems may arise and how to minimise them. EGBA has always stressed that any policy decision should be based upon scientifically proven facts and figures. We therefore call upon national governments and the scientific community in Europe to take these methodologies into account and conduct further studies when regulating online gambling." says Sigrid Ligné, secretary general of the EGBA, the European association of private online gaming and betting operators. “In order to gain a more comprehensive understanding of online gambling, extensive research needs to be conducted.
This study has the merit that it shows for the first time the very limited impact on addiction among online gamblers. But at the same time education remains necessary and governments have a responsibility to take up this aspect", according to Geoffrey Godbold, CEO of GamCare in London. EGBA reminds regulators that this peer-reviewed study proves its awareness of and commitment to responsible gaming. Moreover, all EGBA members are bound to comply with the EGBA Code of Conduct. This self-regulation system was set up by investigating industry best practice, leading jurisdictions and state monopoly standards and will be independently monitored.
press release EGBA
The study has followed a sample of more than 40.000 individual online gamblers over a period of 8 months. It is the first time ever that such a large investigation is based on the actual online gaming behaviour rather than on self-reports. This has been made possible due to the collaboration with the private online operator and EGBA member bwin that has opened its data centre to the researchers of Harvard Medical School. The first publication of this ongoing research study can be found under http://www.divisiononaddictions.org/html/library.htm.
Preliminary results of this ongoing study have been presented by Drs. Howard Shaffer and Richard LaBrie of Havard Medical School at a workshop hosted by EGBA in which leading experts in the field of gaming, addiction and social responsibility took part. "Addiction has on many occasions been raised as one of the concerns associated with gambling related activites. Our intensive research reveals that many different elements contribute to the fact that only a very small proportion of people experience gambling addiction, whether online or with traditional forms of gambling. Moreover, the most striking result of this research shows that the assumption of a typical gambler being somebody out of control is fundamentally wrong. This data shows that a typical online gambler risks 148€ and has a loss of about 33€ during a period of 8 months" according to professor Howard J. Shaffer, head of this research project.
"We are very pleased that one of our members, bwin, has been willing to contribute to such an important scientific project. This study and its first results bring some important insight to the behavioural aspects and helps us all better understand what possible problems may arise and how to minimise them. EGBA has always stressed that any policy decision should be based upon scientifically proven facts and figures. We therefore call upon national governments and the scientific community in Europe to take these methodologies into account and conduct further studies when regulating online gambling." says Sigrid Ligné, secretary general of the EGBA, the European association of private online gaming and betting operators. “In order to gain a more comprehensive understanding of online gambling, extensive research needs to be conducted.
This study has the merit that it shows for the first time the very limited impact on addiction among online gamblers. But at the same time education remains necessary and governments have a responsibility to take up this aspect", according to Geoffrey Godbold, CEO of GamCare in London. EGBA reminds regulators that this peer-reviewed study proves its awareness of and commitment to responsible gaming. Moreover, all EGBA members are bound to comply with the EGBA Code of Conduct. This self-regulation system was set up by investigating industry best practice, leading jurisdictions and state monopoly standards and will be independently monitored.
press release EGBA
EGBA welcomes the adoption of a Code of Conduct on sports betting by 23 European Lotteries
The EGBA, representing the main European online gaming and sports betting operators, welcomes the adoption of a code of conduct on sports betting by 23 European lotteries, and calls on the remaining to do the same. EGBA members have already adopted a strict and obligatory code of conduct since 2003 in protecting players, fighting money laundering and gambling addiction in sports betting and all other games offered online.
Private operators have for several years taken strong commitments and actions to offer safe and secured online games and bets. According to Sigrid Ligné, Secretary General of the EGBA, “in the specific case of sport betting, private initiatives such as the European Sports Security Association (www.eu-ssa.org), are already largely contributing to enhance clean and fair sports by alerting the competent sport regulators on irregular betting patterns. ESSA has signed specific cooperation agreements with FIFA, UEFA, and the Royal Belgian Football Association. The EGBA recalls that corruption of sport teams is strongly damaging clubs, gaming operators and players.
By adopting their code of conduct, lotteries are following the example of EGBA members who implemented a strict code of conduct since the creation of the association in 2003. In the frame of corporate responsibility, EGBA members have taken strict measures such as the regular checking of IDs, providing assistance to problem gamblers, implementing the strictest anti money laundering standards, and preventing taking bets on questionable sport events.
press release EGBA
Private operators have for several years taken strong commitments and actions to offer safe and secured online games and bets. According to Sigrid Ligné, Secretary General of the EGBA, “in the specific case of sport betting, private initiatives such as the European Sports Security Association (www.eu-ssa.org), are already largely contributing to enhance clean and fair sports by alerting the competent sport regulators on irregular betting patterns. ESSA has signed specific cooperation agreements with FIFA, UEFA, and the Royal Belgian Football Association. The EGBA recalls that corruption of sport teams is strongly damaging clubs, gaming operators and players.
By adopting their code of conduct, lotteries are following the example of EGBA members who implemented a strict code of conduct since the creation of the association in 2003. In the frame of corporate responsibility, EGBA members have taken strict measures such as the regular checking of IDs, providing assistance to problem gamblers, implementing the strictest anti money laundering standards, and preventing taking bets on questionable sport events.
press release EGBA
EGBA welcomes further steps to remove national gambling protectionism
The European Gaming & Betting Association (EGBA), welcomes today’s decision by the European Commission to challenge two of the largest EU gambling monopolies by sending a reasoned opinion to Sweden and France and by pursuing infringement proceedings against Greece.
“As the guardian of the EU Treaty, the Commission has taken another important step towards removing unjustified restrictive national measures and creating a level playing field and a single market across the EU. The measures designed to protect national or regional markets do nothing to serve the population of the EU - they are discriminatory, inconsistent and clearly against both progress and simple single market principles”, says EGBA Secretary-General Sigrid Ligné. “While this is an important step forward, we urge Finland, Hungary, Denmark and now Sweden and France to follow the clear requests of the Commission to bring their legislation in conformity with EU law. It is time now for the Governments to accept a dialogue with the leading European operators and to seek the development of sustainable and fair regulation in order to prevent lengthy court actions.”
Today’s decision to send a Reasoned Opinion against Sweden shows that the Commission’s infringement procedures can be suspended only on the basis of solid evidence that the national authorities are in the process of bringing the targeted national legislation in full conformity with EU law.
The EGBA hopes that France’s new government will understand that accepting the principles laid down in the EU Treaty and working closely with the European Commission is the only way to meaningfully regulate the gambling and betting industry in Europe, an industry that like many other sectors, now transcends state borders through the Internet. Proper regulation and control of this increasingly popular activity is the only sensible way forward as demonstrated in several other EU Member States, including the UK.
OPAP, the Greek national monopoly, has over the years continued to maximise its profits, expanding its activities beyond the Greek borders while preventing a fair access of EU operators to its market. “The decision to open an infringement procedure against Greece was widely expected since the purpose of OPAP is clearly not to seek a genuine decrease of gambling opportunities” says Ligné.
Sigrid Ligné also said: “To claim that only closed, nationally monopolistic markets can protect the consumer when it comes to gambling services is clearly untrue. It is a fact that EGBA’s Code of Conduct applies to all of its members in addition to their national legal requirements, and is independently verified. It requires additional standards of consumer protection and social responsibility that match or even exceed those established by many EU gambling monopolies.” In particular, the Code seeks to address a number of key concerns such as problem gambling and by ensuring that children are prevented from playing and that vulnerable players are properly protected. “In our view, European adults have the right to use the Internet for gambling services if they so choose and should be able to access properly regulated and legitimate service providers, irrespective of their location in the EU. Ultimately, the nature of the Internet means that the best way to guarantee that all public and private actors comply with appropriate rules and regulations would be to agree on a framework at the EU level” says Sigrid Ligné.
press release EBGA
“As the guardian of the EU Treaty, the Commission has taken another important step towards removing unjustified restrictive national measures and creating a level playing field and a single market across the EU. The measures designed to protect national or regional markets do nothing to serve the population of the EU - they are discriminatory, inconsistent and clearly against both progress and simple single market principles”, says EGBA Secretary-General Sigrid Ligné. “While this is an important step forward, we urge Finland, Hungary, Denmark and now Sweden and France to follow the clear requests of the Commission to bring their legislation in conformity with EU law. It is time now for the Governments to accept a dialogue with the leading European operators and to seek the development of sustainable and fair regulation in order to prevent lengthy court actions.”
Today’s decision to send a Reasoned Opinion against Sweden shows that the Commission’s infringement procedures can be suspended only on the basis of solid evidence that the national authorities are in the process of bringing the targeted national legislation in full conformity with EU law.
The EGBA hopes that France’s new government will understand that accepting the principles laid down in the EU Treaty and working closely with the European Commission is the only way to meaningfully regulate the gambling and betting industry in Europe, an industry that like many other sectors, now transcends state borders through the Internet. Proper regulation and control of this increasingly popular activity is the only sensible way forward as demonstrated in several other EU Member States, including the UK.
OPAP, the Greek national monopoly, has over the years continued to maximise its profits, expanding its activities beyond the Greek borders while preventing a fair access of EU operators to its market. “The decision to open an infringement procedure against Greece was widely expected since the purpose of OPAP is clearly not to seek a genuine decrease of gambling opportunities” says Ligné.
Sigrid Ligné also said: “To claim that only closed, nationally monopolistic markets can protect the consumer when it comes to gambling services is clearly untrue. It is a fact that EGBA’s Code of Conduct applies to all of its members in addition to their national legal requirements, and is independently verified. It requires additional standards of consumer protection and social responsibility that match or even exceed those established by many EU gambling monopolies.” In particular, the Code seeks to address a number of key concerns such as problem gambling and by ensuring that children are prevented from playing and that vulnerable players are properly protected. “In our view, European adults have the right to use the Internet for gambling services if they so choose and should be able to access properly regulated and legitimate service providers, irrespective of their location in the EU. Ultimately, the nature of the Internet means that the best way to guarantee that all public and private actors comply with appropriate rules and regulations would be to agree on a framework at the EU level” says Sigrid Ligné.
press release EBGA
27 June 2007
Infringement proceedings against France, Sweden and Greece
Crucial development for private gaming sector:
- Infringement proceedings against France and Sweden to be continued
- Initiation of infringement proceedings against Greece
- Austria yields to pressure from Commission in infringement proceedings
bwin welcomes today's decision by the European Commission to continue the infringement proceedings already instituted against France and Sweden in connection with gaming by issuing reasoned opinions. These so-called reasoned opinions represent the second stage in infringement proceedings. If the countries involved do not now take the demands of the European Commission into account, they are liable to be taken before the European Court of Justice.
The fact that Greece now also sees itself confronted with infringement proceedings can be attributed to the many protectionist measures on the Greek gaming market that are not in compliance with EU legislation.
The European Court of Justice recently declared Sweden's alcohol monopoly to be in contravention of EU legislation, and the gaming monopoly is now also coming under increasing pressure. The fact that, in the opinion of the European Court of Justice, the alcohol monopoly is not in conformity with the basic freedoms of the European Union makes us optimistic that the enlightened regulation of the gaming market will soon be forthcoming, commented Norbert Teufelberger, bwin Co-CEO.
Even France, which in the past has acted particularly aggressively towards private gaming providers licensed in the EU, has not managed to convince the Commission that its monopoly of gaming and horseracing is in conformity with EU legislation. In a detailed opinion the Commission has sharply criticized the discrepancies in the existing French regulations.
The initiation of infringement proceedings against Greece is also an indication that monopolies - even in sensitive areas such as alcohol, banking and gaming - are no longer in keeping with the times, and that cross-border solutions in keeping with EU legislation are called for instead. Only very recently, Greek market makers have frequently found themselves confronted with criminal proceedings, whereas the government's publicly listed OPAP company was free to maximize profits in the interests of shareholder value. This makes the Commission's decision to institute infringement proceedings all the more gratifying, said bwin Co-CEO Manfred Bodner.
The Austrian government has so far been unable to refute the Commission's accusations in the infringement proceedings against Austria. The Austrian government has therefore been obliged to assure the Commission that appropriate amendments will be made to its gaming laws with respect to the discrimination of foreign gamers and advertising restrictions for non-Austrian providers. If Austria fails to implement these amendments within the next few months, this would be in blatant infringement of European legislation, and the Commission would continue its formal infringement proceedings by initiating the second stage. This concession by the Austrian government shows that members states are aware that national gaming monopolies are not compatible with European law, and cannot therefore be sustained in the long term. This represents a positive step towards a modern, competitive legislative framework for cross-border gaming.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
press release bwin
- Infringement proceedings against France and Sweden to be continued
- Initiation of infringement proceedings against Greece
- Austria yields to pressure from Commission in infringement proceedings
bwin welcomes today's decision by the European Commission to continue the infringement proceedings already instituted against France and Sweden in connection with gaming by issuing reasoned opinions. These so-called reasoned opinions represent the second stage in infringement proceedings. If the countries involved do not now take the demands of the European Commission into account, they are liable to be taken before the European Court of Justice.
The fact that Greece now also sees itself confronted with infringement proceedings can be attributed to the many protectionist measures on the Greek gaming market that are not in compliance with EU legislation.
The European Court of Justice recently declared Sweden's alcohol monopoly to be in contravention of EU legislation, and the gaming monopoly is now also coming under increasing pressure. The fact that, in the opinion of the European Court of Justice, the alcohol monopoly is not in conformity with the basic freedoms of the European Union makes us optimistic that the enlightened regulation of the gaming market will soon be forthcoming, commented Norbert Teufelberger, bwin Co-CEO.
Even France, which in the past has acted particularly aggressively towards private gaming providers licensed in the EU, has not managed to convince the Commission that its monopoly of gaming and horseracing is in conformity with EU legislation. In a detailed opinion the Commission has sharply criticized the discrepancies in the existing French regulations.
The initiation of infringement proceedings against Greece is also an indication that monopolies - even in sensitive areas such as alcohol, banking and gaming - are no longer in keeping with the times, and that cross-border solutions in keeping with EU legislation are called for instead. Only very recently, Greek market makers have frequently found themselves confronted with criminal proceedings, whereas the government's publicly listed OPAP company was free to maximize profits in the interests of shareholder value. This makes the Commission's decision to institute infringement proceedings all the more gratifying, said bwin Co-CEO Manfred Bodner.
The Austrian government has so far been unable to refute the Commission's accusations in the infringement proceedings against Austria. The Austrian government has therefore been obliged to assure the Commission that appropriate amendments will be made to its gaming laws with respect to the discrimination of foreign gamers and advertising restrictions for non-Austrian providers. If Austria fails to implement these amendments within the next few months, this would be in blatant infringement of European legislation, and the Commission would continue its formal infringement proceedings by initiating the second stage. This concession by the Austrian government shows that members states are aware that national gaming monopolies are not compatible with European law, and cannot therefore be sustained in the long term. This represents a positive step towards a modern, competitive legislative framework for cross-border gaming.
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
press release bwin
26 June 2007
Deal Rumours Suggest Legal Uncertainties Growing In Germany
www.gamblingcompliance.com 26 June 2007
by James Kilsby
With pressure growing from both its national courts and the European Commission to determine a coherent gambling policy, politicians charged with steering Germany towards new gambling legislation are showing signs of denial.
Observers of the German gambling market have expressed surprise at the state Prime Ministers’ failure to approach the topic of gambling at the most recent prime ministerial conference in Berlin last Friday.
“At least as far as I’m aware, gambling was not discussed at the meeting,” says German gaming lawyer Martin Arendts, of the firm Arendts Anwalte. In accordance with a constitutional court ruling of March 2006, the Prime Ministers of the sixteen German Lander must unanimously adopt new legislation covering betting in Germany before January 1, 2008. The court found the existing state monopoly to be unconstitutional in its current form.
Expectation that the Prime Ministers would come round to addressing gambling at the latest meeting, after their failure to do so in March, had been raised by the European Commission’s continued interest in the current draft for new legislation, which the Commission clearly considers to be totally at odds with various aspects of European Community law. PR campaigns from private lottery companies highlighting the need for new legislation further served to raise the issue’s profile in the German media, one gaming company even taking out a full-page advertisement in a German newspaper.
The lack of news following last Friday’s meeting will therefore be of surprise to many, of disappointment to some and a relief to others. A report published in popular German weekly publication Der Spiegel on Saturday, and since circulated widely by Reuters, suggests instead that the state Prime Ministers are awaiting further guidance from the European Commission on the matter. According to Der Spiegel, representatives from the German Lander have arranged to meet with the European Commission sometime in early July.
Der Spiegel also reports that the German states have been offered a form of compromise deal by the European Commission that would allow the states to keep their lottery monopolies so long as the German sports betting market is opened to private operators. If sports betting was liberalised “the Commission would in no way challenge the existence and continuation of the states’ monopolies on lotteries and other forms of gambling,” says the report, citing an anonymous source in Brussels.
Given that it is the duty of the European Commission to monitor all European markets, such a clear-cut compromise certainly seems unlikely to be binding. Arendts agrees that any deal with the Commission could only be a temporary solution. “I cannot imagine how such a compromise would work,” he says.
According to Arendts, a compromise in which sports betting was liberalised would allow the European Commission to draw a line under the open infringement investigation into the German sports betting market, which could even be raised to the level of a Reasoned Opinion this week, as well as rendering the Commission’s investigation into the draft Interstate Lotteries Treaty obsolete as that would not be adopted. “It could only relate to the infringement proceedings that are already open,” he says.
A compromise between the Commission and Germany would not have any bearing on future cases to be decided in courts in either Germany or Luxembourg. “A deal would not have any effect on upcoming court cases within Germany – of which there are thousands. There are also two cases (related to cross-border gambling) due in the European Court of Justice and the ECJ doesn’t care about political compromises,” says Arendts.
Severe doubts surrounding the legitimacy of the states’ lottery monopolies, monopolies that would presumably go unchallenged by the Commission under the terms of the agreement over sports betting, have been raised by recent German court rulings. Last week, the Federal Supreme Court upheld rulings delivered by both the Federal Cartel Office and the Higher Regional Court in Dusseldorf that the cartel of German state lottery companies, Deutscher Lotto- und Totoblock, has contravened both German and European anti-trust law by agreeing not compete within one another across German state borders.
In the current situation, an agreement with the European Commission would by no means ease all of Lotto- und Totoblock’s woes. Moreover, according to Arendts, even if the European Commission has offered a compromise, there is no guarantee that it would prove to be an acceptable political solution to the German Lander, as the Prime Ministers of certain states remain determined to keep sports betting under state control. “It will be very hard to agree a compromise. Various German states would not agree to this,” he says.
For Arendts, the lack of discussion on the issue last week further increases the possibility that the German states will be unable to agree on legislation before the deadline set by the constitutional court. “They are really running into trouble. Not only do they have to find a solution but also they have to pass a Parliamentary Act. Most state Parliaments have ignored the problem until now.”
One option would be for the Bundestag to take the matter out of the states’ hands and pass a federal law. Arendts does not consider this a likely alternative however. “The Bundestag sports committee had a meeting and decided not to pass a Federal law and this [position] is not going to change. If the Federal government stepped in, it would change the nature of ‘checks and balances’ between the Bundestag and the German states – they even changed the German constitution last year to protect these checks and balances so it is an extremely sensitive political situation.”
As the gambling industry approaches the second half of 2007, the odds appear to be shortening on Germany passing new betting legislation before the year’s end. The Federal Government could reluctantly still step in at that point to avoid the constitutional crisis that would ensue if no agreement is reached in the next six months. The lack of a consensus at a state level suggests that it may yet have to.
by James Kilsby
With pressure growing from both its national courts and the European Commission to determine a coherent gambling policy, politicians charged with steering Germany towards new gambling legislation are showing signs of denial.
Observers of the German gambling market have expressed surprise at the state Prime Ministers’ failure to approach the topic of gambling at the most recent prime ministerial conference in Berlin last Friday.
“At least as far as I’m aware, gambling was not discussed at the meeting,” says German gaming lawyer Martin Arendts, of the firm Arendts Anwalte. In accordance with a constitutional court ruling of March 2006, the Prime Ministers of the sixteen German Lander must unanimously adopt new legislation covering betting in Germany before January 1, 2008. The court found the existing state monopoly to be unconstitutional in its current form.
Expectation that the Prime Ministers would come round to addressing gambling at the latest meeting, after their failure to do so in March, had been raised by the European Commission’s continued interest in the current draft for new legislation, which the Commission clearly considers to be totally at odds with various aspects of European Community law. PR campaigns from private lottery companies highlighting the need for new legislation further served to raise the issue’s profile in the German media, one gaming company even taking out a full-page advertisement in a German newspaper.
The lack of news following last Friday’s meeting will therefore be of surprise to many, of disappointment to some and a relief to others. A report published in popular German weekly publication Der Spiegel on Saturday, and since circulated widely by Reuters, suggests instead that the state Prime Ministers are awaiting further guidance from the European Commission on the matter. According to Der Spiegel, representatives from the German Lander have arranged to meet with the European Commission sometime in early July.
Der Spiegel also reports that the German states have been offered a form of compromise deal by the European Commission that would allow the states to keep their lottery monopolies so long as the German sports betting market is opened to private operators. If sports betting was liberalised “the Commission would in no way challenge the existence and continuation of the states’ monopolies on lotteries and other forms of gambling,” says the report, citing an anonymous source in Brussels.
Given that it is the duty of the European Commission to monitor all European markets, such a clear-cut compromise certainly seems unlikely to be binding. Arendts agrees that any deal with the Commission could only be a temporary solution. “I cannot imagine how such a compromise would work,” he says.
According to Arendts, a compromise in which sports betting was liberalised would allow the European Commission to draw a line under the open infringement investigation into the German sports betting market, which could even be raised to the level of a Reasoned Opinion this week, as well as rendering the Commission’s investigation into the draft Interstate Lotteries Treaty obsolete as that would not be adopted. “It could only relate to the infringement proceedings that are already open,” he says.
A compromise between the Commission and Germany would not have any bearing on future cases to be decided in courts in either Germany or Luxembourg. “A deal would not have any effect on upcoming court cases within Germany – of which there are thousands. There are also two cases (related to cross-border gambling) due in the European Court of Justice and the ECJ doesn’t care about political compromises,” says Arendts.
Severe doubts surrounding the legitimacy of the states’ lottery monopolies, monopolies that would presumably go unchallenged by the Commission under the terms of the agreement over sports betting, have been raised by recent German court rulings. Last week, the Federal Supreme Court upheld rulings delivered by both the Federal Cartel Office and the Higher Regional Court in Dusseldorf that the cartel of German state lottery companies, Deutscher Lotto- und Totoblock, has contravened both German and European anti-trust law by agreeing not compete within one another across German state borders.
In the current situation, an agreement with the European Commission would by no means ease all of Lotto- und Totoblock’s woes. Moreover, according to Arendts, even if the European Commission has offered a compromise, there is no guarantee that it would prove to be an acceptable political solution to the German Lander, as the Prime Ministers of certain states remain determined to keep sports betting under state control. “It will be very hard to agree a compromise. Various German states would not agree to this,” he says.
For Arendts, the lack of discussion on the issue last week further increases the possibility that the German states will be unable to agree on legislation before the deadline set by the constitutional court. “They are really running into trouble. Not only do they have to find a solution but also they have to pass a Parliamentary Act. Most state Parliaments have ignored the problem until now.”
One option would be for the Bundestag to take the matter out of the states’ hands and pass a federal law. Arendts does not consider this a likely alternative however. “The Bundestag sports committee had a meeting and decided not to pass a Federal law and this [position] is not going to change. If the Federal government stepped in, it would change the nature of ‘checks and balances’ between the Bundestag and the German states – they even changed the German constitution last year to protect these checks and balances so it is an extremely sensitive political situation.”
As the gambling industry approaches the second half of 2007, the odds appear to be shortening on Germany passing new betting legislation before the year’s end. The Federal Government could reluctantly still step in at that point to avoid the constitutional crisis that would ensue if no agreement is reached in the next six months. The lack of a consensus at a state level suggests that it may yet have to.
25 June 2007
European Commission proposes gambling monopoly compromise
According to the German magazine "Der Spiegel", the European Commission has offered Germany a compromise allowing it to continue with state monopolies on lotteries and casinos. The article reported that, by allowing sports betting firms to operate in its state jurisdictions, Germany would not face a challenge to the 'existence and continuation of the states’ monopolies on lotteries and other forms of gambling' by the EU.
24 June 2007
First empirical study of online gaming behaviour
To date, only speculations have been available to guide our understanding of the scale of gaming and problematic gaming behaviour among online sports betting. Now the initial results of a unique, broad-based study investigating the gaming behaviour of online players are available, which begins to shed light on the potential for gaming related problems.
Harvard Medical School faculty from the Division on Addictions have been active in the addiction research and treatment field for the past 30 years. They have been cooperating with bwin since May 2005 to undertake a research project the like of which has never been done before. For the first time ever, researchers are examining online gaming, not by means of difficult to verify opinions and self-report, but by carefully studying the actual online behaviour of players. In an anonymous study, researchers observed the actual behaviour of more than 40,000 active bwin users for a period of eight months. The first findings have now been published and might be surprising to some.
The first publication from this project is available at the Division on Addictions (http://www.divisiononaddictions.org/html/library.htm). The majority of the players observed in the course of the study exhibited moderate gaming behaviour. For example, the average loss of the players participating in this eight-month study amounted to 33 euro. Only 0.4% of the total sample could be classified as distinctively heavy bettors with large losses, suggesting that only a limited number of players might have serious financial problems. Further research will now investigate how many players report gaming related problems at every level of play.
These encouraging initial results from the long-term study indicate that the potential of sports betting to cause a problem is considerably lower than generally presumed. Drs. Howard Shaffer and Richard LaBrie of Harvard Medical School conducted a workshop on Thursday in Vienna attended by leading European gaming experts.
One of the workshop participants was Geoffrey Godbold, Chief Executive Officer of GAMcare. He said that "this research will help identify addictive gamblers at an early stage." He also suggested that, in terms of future regulation, "it is important not to spoil the fun of the majority but rather target the small minority that has problems."
Howard Shaffer noted, "This is a landmark project for both the gaming industry and science because we are studying the actual gambling behaviour of a large sample of Internet gamblers for the very first time. I am proud of bwin for committing to using science as a guide to assuring the welfare of their customers and to advancing the safety of the Internet and new technology."
"Particularly in view of the fact that gaming addiction is used generally as an argument to justify betting and gaming monopolies, these initial results are specially gratifying." bwin Co-CEO Norbert Teufelberger comments the research project initiated by bwin. Co-CEO Manfred Bodner adds: "The intensive collaboration between researchers on the one hand and practitioners on the other warrants that science does not conduct research without taking practical experience into account. bwin has dared to take that step and has consulted independent experts on this subject matter. Which has proven to be a good decision in all aspects."
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag
press release bwin
Harvard Medical School faculty from the Division on Addictions have been active in the addiction research and treatment field for the past 30 years. They have been cooperating with bwin since May 2005 to undertake a research project the like of which has never been done before. For the first time ever, researchers are examining online gaming, not by means of difficult to verify opinions and self-report, but by carefully studying the actual online behaviour of players. In an anonymous study, researchers observed the actual behaviour of more than 40,000 active bwin users for a period of eight months. The first findings have now been published and might be surprising to some.
The first publication from this project is available at the Division on Addictions (http://www.divisiononaddictions.org/html/library.htm). The majority of the players observed in the course of the study exhibited moderate gaming behaviour. For example, the average loss of the players participating in this eight-month study amounted to 33 euro. Only 0.4% of the total sample could be classified as distinctively heavy bettors with large losses, suggesting that only a limited number of players might have serious financial problems. Further research will now investigate how many players report gaming related problems at every level of play.
These encouraging initial results from the long-term study indicate that the potential of sports betting to cause a problem is considerably lower than generally presumed. Drs. Howard Shaffer and Richard LaBrie of Harvard Medical School conducted a workshop on Thursday in Vienna attended by leading European gaming experts.
One of the workshop participants was Geoffrey Godbold, Chief Executive Officer of GAMcare. He said that "this research will help identify addictive gamblers at an early stage." He also suggested that, in terms of future regulation, "it is important not to spoil the fun of the majority but rather target the small minority that has problems."
Howard Shaffer noted, "This is a landmark project for both the gaming industry and science because we are studying the actual gambling behaviour of a large sample of Internet gamblers for the very first time. I am proud of bwin for committing to using science as a guide to assuring the welfare of their customers and to advancing the safety of the Internet and new technology."
"Particularly in view of the fact that gaming addiction is used generally as an argument to justify betting and gaming monopolies, these initial results are specially gratifying." bwin Co-CEO Norbert Teufelberger comments the research project initiated by bwin. Co-CEO Manfred Bodner adds: "The intensive collaboration between researchers on the one hand and practitioners on the other warrants that science does not conduct research without taking practical experience into account. bwin has dared to take that step and has consulted independent experts on this subject matter. Which has proven to be a good decision in all aspects."
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Soccer League. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag
press release bwin
20 June 2007
REAL MADRID DEAL RAISES QUESTION OVER ONLINE GAMING IN SPAIN
Spain's communications watchdog, Asociación de Usuarios de la Comunicación (AUC), has logged a formal complaint with Spain's Ministry of Economy and Taxes, demanding an investigation into online gaming company, bwin's sponsorship of Real Madrid.
Real Madrid earlier this month signed a deal to make Austrian on-line betting firm Bwin its main sponsor. The Spanish media reported the deal to be worth between €15 million and €20 million.
The AUC believes that the shirt sponsorship is breaking up to as many as eight Spanish laws which they claim make it illegal for unlicensed online gaming companies to advertise their services in Spain.
888.com’s shirt sponsorship of Seville and Miapuesta’s deal with Figueres have also caught the attention of the AUC.
sportbusiness.com
Real Madrid earlier this month signed a deal to make Austrian on-line betting firm Bwin its main sponsor. The Spanish media reported the deal to be worth between €15 million and €20 million.
The AUC believes that the shirt sponsorship is breaking up to as many as eight Spanish laws which they claim make it illegal for unlicensed online gaming companies to advertise their services in Spain.
888.com’s shirt sponsorship of Seville and Miapuesta’s deal with Figueres have also caught the attention of the AUC.
sportbusiness.com
15 June 2007
Consequences of the Ladbrokes decision
quotation from World Online Gambling Law Report, May 2007
Ladbrokes: key guidance on restriction of services
by Martin Arendts, M.B.L.-HSG
(...)
In my view, the quintessence of the Ladbrokes decision is clearly the intensified analysis in the assessment of gambling services. Questions which recently have been regarded as purely political or which the ECJ mentioned incidentally have now come under the strict scrutiny of the judges.
The consistency test, developed by the ECJ in several decisions over the years, has now become a very detailed examination of the political aims and objectives and an explicit verification of the behaviour of the monopoly operators. The judges will now
have to address complex and discretionary issues, such as whether the advertising of the gambling and betting services is more informative than evocative in nature. National measures, aims put forward by the state or objectives are no longer sheltered from judicial review. The only exception which remains in the state’s discretion is the level of protection sought. Even then, the judges will have to decide whether the national gaming policy is indeed consistent and systematic on one hand, or whether it may be necessary to distinguish between the different games on the other hand.
The Ladbrokes as well as the Gaming Machines decisions provide for an extensive check list of questions the courts will have to answer in the affirmative in order to uphold a monopoly. Therefore, I do not comprehend why Norsk Tipping, European Lotteries as well as Deutscher Lotto- und Totoblock publicly announced that they are pleased with the Ladbrokes decision. The present legal regulations in most EEA Member States certainly do not fulfil the requirements the ECJ and the EFTA Court have set out. For example, Germany has a very inconsistent policy and no uniform level of protection. The same holds true for most other EU Member States with a gambling monopoly.
The plan to uphold a national monopoly at any cost will backfire in the long run, as judges and not politicians will have a greater say on the subject. This intensified judicial review will have a strong impact on national jurisdictions and national legislation issues. In this respect, it will certainly no longer be sufficient that a national court can simply decide that combating gambling addiction justifies any restriction of the fundamental freedoms. The State will have to demonstrate that only a monopoly will provide for a lower level of gambling addiction in society than would be the case without restrictions on free movement. The national court will have to ascertain the suitability and necessity of national measures in detail. Also the legislator will have to assess the potential risks associated with different games and decide on a uniform system of protection.
Ladbrokes: key guidance on restriction of services
by Martin Arendts, M.B.L.-HSG
(...)
In my view, the quintessence of the Ladbrokes decision is clearly the intensified analysis in the assessment of gambling services. Questions which recently have been regarded as purely political or which the ECJ mentioned incidentally have now come under the strict scrutiny of the judges.
The consistency test, developed by the ECJ in several decisions over the years, has now become a very detailed examination of the political aims and objectives and an explicit verification of the behaviour of the monopoly operators. The judges will now
have to address complex and discretionary issues, such as whether the advertising of the gambling and betting services is more informative than evocative in nature. National measures, aims put forward by the state or objectives are no longer sheltered from judicial review. The only exception which remains in the state’s discretion is the level of protection sought. Even then, the judges will have to decide whether the national gaming policy is indeed consistent and systematic on one hand, or whether it may be necessary to distinguish between the different games on the other hand.
The Ladbrokes as well as the Gaming Machines decisions provide for an extensive check list of questions the courts will have to answer in the affirmative in order to uphold a monopoly. Therefore, I do not comprehend why Norsk Tipping, European Lotteries as well as Deutscher Lotto- und Totoblock publicly announced that they are pleased with the Ladbrokes decision. The present legal regulations in most EEA Member States certainly do not fulfil the requirements the ECJ and the EFTA Court have set out. For example, Germany has a very inconsistent policy and no uniform level of protection. The same holds true for most other EU Member States with a gambling monopoly.
The plan to uphold a national monopoly at any cost will backfire in the long run, as judges and not politicians will have a greater say on the subject. This intensified judicial review will have a strong impact on national jurisdictions and national legislation issues. In this respect, it will certainly no longer be sufficient that a national court can simply decide that combating gambling addiction justifies any restriction of the fundamental freedoms. The State will have to demonstrate that only a monopoly will provide for a lower level of gambling addiction in society than would be the case without restrictions on free movement. The national court will have to ascertain the suitability and necessity of national measures in detail. Also the legislator will have to assess the potential risks associated with different games and decide on a uniform system of protection.
13 June 2007
German Court Says Lottery Cartel Violates Anti-Trust Laws
by James Kilsby, gamblingcompliance.com
The Higher Regional Court in Dusseldorf has upheld an earlier ruling of August 2006 that the Deutscher Lotto- und Totoblock's regionalised division of the German lottery market constitutes a violation of both European and German law.
The German Federal Cartel Office ruled last year that the agreement between the 16 state monopoly lottery operators in German to restrict their operations purely to their own regions to avoid entering into competition with one another represented an illegal cartel, in contravention of both German and European anti-trust laws.
Private lottery operator FLUXX AG initiated proceedings against the Deutscher Lotto- und Totoblock once the group attempted to prohibit private lottery distributors from selling various state lottery products in gas stations and other outlets throughout Germany, i.e. outside of the lottery’s state of origin and therefore effectively in competition with the products of a ‘rival’ state monopoly.
“Private operators wanted to sell products from state lottery companies that paid the highest commission but the Deutscher Lotto- und Totoblock tried to ban commercial operators,” explains leading German gaming lawyer Martin Arendts. “The court has said that under this system the monopoly operators do not compete with each other and form a cartel. It is illegal under German cartel law to agree not to compete.”
The Dusseldorf decision means that the 2006 ruling will now come into effect and private lottery companies should be free to distribute state lottery products throughout the country. Arendts believes that the verdict has even broader consequences for the German gambling industry. “This is a very fundamental decision. It almost outlaws the Deutscher Lotto- und Totoblock which is a kind of illegal organization now,” he says.
A spokesman from the Deutscher Lotto- und Totoblock was unavailable for comment yesterday although Gamblingcompliance.com understands that the group has indicated its intention to appeal the decision in the Federal Court of Justice.
In a second Detailed Opinion on the draft Interstate Lotteries Treaty proposed by the German Lander in 2006, the European Commission emphatically highlighted that the treaty renewing the states’ betting monopolies and outlawing the use of the internet for all gambling services would be illegal under European law were it to be adopted. Arendts believes that the verdict in Dusseldorf on Friday will now further increase the pressure on the 16 state Prime Ministers to discuss alternative legislation at their next scheduled meeting on June 22. “They should discuss new regulation now,” he says.
gamblingcompliance.com
The Higher Regional Court in Dusseldorf has upheld an earlier ruling of August 2006 that the Deutscher Lotto- und Totoblock's regionalised division of the German lottery market constitutes a violation of both European and German law.
The German Federal Cartel Office ruled last year that the agreement between the 16 state monopoly lottery operators in German to restrict their operations purely to their own regions to avoid entering into competition with one another represented an illegal cartel, in contravention of both German and European anti-trust laws.
Private lottery operator FLUXX AG initiated proceedings against the Deutscher Lotto- und Totoblock once the group attempted to prohibit private lottery distributors from selling various state lottery products in gas stations and other outlets throughout Germany, i.e. outside of the lottery’s state of origin and therefore effectively in competition with the products of a ‘rival’ state monopoly.
“Private operators wanted to sell products from state lottery companies that paid the highest commission but the Deutscher Lotto- und Totoblock tried to ban commercial operators,” explains leading German gaming lawyer Martin Arendts. “The court has said that under this system the monopoly operators do not compete with each other and form a cartel. It is illegal under German cartel law to agree not to compete.”
The Dusseldorf decision means that the 2006 ruling will now come into effect and private lottery companies should be free to distribute state lottery products throughout the country. Arendts believes that the verdict has even broader consequences for the German gambling industry. “This is a very fundamental decision. It almost outlaws the Deutscher Lotto- und Totoblock which is a kind of illegal organization now,” he says.
A spokesman from the Deutscher Lotto- und Totoblock was unavailable for comment yesterday although Gamblingcompliance.com understands that the group has indicated its intention to appeal the decision in the Federal Court of Justice.
In a second Detailed Opinion on the draft Interstate Lotteries Treaty proposed by the German Lander in 2006, the European Commission emphatically highlighted that the treaty renewing the states’ betting monopolies and outlawing the use of the internet for all gambling services would be illegal under European law were it to be adopted. Arendts believes that the verdict in Dusseldorf on Friday will now further increase the pressure on the 16 state Prime Ministers to discuss alternative legislation at their next scheduled meeting on June 22. “They should discuss new regulation now,” he says.
gamblingcompliance.com
11 June 2007
bwin new main sponsor of Real Madrid
bwin is pleased to announce a new partnership starting on 1 July 2007 as official main sponsor of Real Madrid, the top Spanish football club. The agreement has initially been concluded for a period of three seasons.
Apart from displaying the bwin logo on the jerseys of the Real Madrid team at national and international matches, the cooperation agreement also extends to extensive branding of the stadiums and Real Madrid's training ground.
The strategic decision to enter into this partnership should be seen against the background that several EU member states have yet to accept the freedom of establishment and services in the area of online gaming, despite the fact that both the European Commission and the European Court of Justice are of the opinion that the offering of online gaming is subject to the free movement of services and the freedom of establishment laid down in the Treaty on European Union. In the future, bwin will therefore be investing its available sponsoring resources in markets that have adopted an enlightened attitude to the subject of gaming regulation.
press release of bwin
Apart from displaying the bwin logo on the jerseys of the Real Madrid team at national and international matches, the cooperation agreement also extends to extensive branding of the stadiums and Real Madrid's training ground.
The strategic decision to enter into this partnership should be seen against the background that several EU member states have yet to accept the freedom of establishment and services in the area of online gaming, despite the fact that both the European Commission and the European Court of Justice are of the opinion that the offering of online gaming is subject to the free movement of services and the freedom of establishment laid down in the Treaty on European Union. In the future, bwin will therefore be investing its available sponsoring resources in markets that have adopted an enlightened attitude to the subject of gaming regulation.
press release of bwin
04 June 2007
European Lotteries pleased with EFTA Court ruling
press release of European Lotteries:
No obligation to open gambling markets, says European court
· Governments may reject commercial operators
· No obligation to recognise licenses of foreign operators
30 May 2007 – Today the Court of the European Free Trade Association (EFTA) in Luxemburg once again denied a commercial gambling operator the right to access the gambling markets of a member state of the European Economic Area (EEA). Today’s ruling follows a judgment by the same court in March 2007, equally on a Norwegian case, in which the court explicitly upheld the country’s monopoly system on gaming machines.
The EFTA Court ruled that where the State holds a monopoly to offer gambling services, “national authorities have the right to ban the provision and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin” (paragraph 5 of the judgment).
Dr Winfried Wortmann, President of the European State Lotteries and Toto Association (European Lotteries, EL) welcomed the Court’s decision: “Whatever the claims of commercial operators in the pages of the press have been over the past months and years. The EFTA Court has made clear once again that gambling services providers need a license from the State in which they want to offer their services and advertise. European law does not require the mutual recognition of operating licenses.”
Dr Winfried Wortmann, re-elected last week to be President of European Lotteries for another two-year term, added: “This is the third defeat for the supporters of a commercialisaton of gambling before a European court this year. In March both the European Court of Justice (ECJ) and the EFTA Court reiterated their standing jurisprudence, according to which Member States are free to define their gambling policy objectives and to determine in detail the level of protection for their citizens, as long as they pursue public interest objectives, such as preventing problem gambling and fighting crime, in a systematic and consistent manner. This includes the option to give an exclusive right (monopoly) to a single state-owned operator, as explicitly recognised by the EFTA Court in its judgment of 14 March 2007.”
No obligation to open gambling markets, says European court
· Governments may reject commercial operators
· No obligation to recognise licenses of foreign operators
30 May 2007 – Today the Court of the European Free Trade Association (EFTA) in Luxemburg once again denied a commercial gambling operator the right to access the gambling markets of a member state of the European Economic Area (EEA). Today’s ruling follows a judgment by the same court in March 2007, equally on a Norwegian case, in which the court explicitly upheld the country’s monopoly system on gaming machines.
The EFTA Court ruled that where the State holds a monopoly to offer gambling services, “national authorities have the right to ban the provision and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin” (paragraph 5 of the judgment).
Dr Winfried Wortmann, President of the European State Lotteries and Toto Association (European Lotteries, EL) welcomed the Court’s decision: “Whatever the claims of commercial operators in the pages of the press have been over the past months and years. The EFTA Court has made clear once again that gambling services providers need a license from the State in which they want to offer their services and advertise. European law does not require the mutual recognition of operating licenses.”
Dr Winfried Wortmann, re-elected last week to be President of European Lotteries for another two-year term, added: “This is the third defeat for the supporters of a commercialisaton of gambling before a European court this year. In March both the European Court of Justice (ECJ) and the EFTA Court reiterated their standing jurisprudence, according to which Member States are free to define their gambling policy objectives and to determine in detail the level of protection for their citizens, as long as they pursue public interest objectives, such as preventing problem gambling and fighting crime, in a systematic and consistent manner. This includes the option to give an exclusive right (monopoly) to a single state-owned operator, as explicitly recognised by the EFTA Court in its judgment of 14 March 2007.”
Norsk Tipping pleased with EFTA Court statement in Ladbrokes case
press rlease of Norsk Tipping of 1 June 2007:
Norsk Tipping AS is pleased with the statement in the EFTA-Court Wednesday where the court confirmed that the principle of a state monopoly for gaming and gambling is not in conflict with EEA-law.
In a statement made to the Oslo City Court Wednesday, the EFTA Court confirmed that the main principles of Norwegian gaming and gambling policy are not in conflict with EEA (European Economic Area) law. The EFTA Court’s statement was made at the request of the Oslo City Court in connection with the international gambling company, Ladbrokes legal proceedings against the Norwegian Government.
“The conclusions are very positive for Norsk Tipping and we also believe that Norsk Tipping fulfils the requirements laid down by the court to justify the monopoly”, comments Reidar Nordby Jr., President and Chief Executive Officer of Norsk Tipping AS.
The Norwegian Attorney General, Dr. Fredrik Sejersted, was also very pleased with the EFTA Court ruling, and stated that it confirms the consistency and legitimacy of the Norwegian gaming legislation.
However, as Ladbrokes claims that Norwegian legislation of gaming and gambling is in conflict with the EEA-Agreement, the case will continue in the Oslo City Court, but the advice from the EFTA Court give important signals to the future proceedings. The Court has not yet fixed the date for these proceedings.
For more information, please contact: Peer J. Svenkerud, Vice-President Information and External Relations, Ph: +47 91554368
Norsk Tipping AS is pleased with the statement in the EFTA-Court Wednesday where the court confirmed that the principle of a state monopoly for gaming and gambling is not in conflict with EEA-law.
In a statement made to the Oslo City Court Wednesday, the EFTA Court confirmed that the main principles of Norwegian gaming and gambling policy are not in conflict with EEA (European Economic Area) law. The EFTA Court’s statement was made at the request of the Oslo City Court in connection with the international gambling company, Ladbrokes legal proceedings against the Norwegian Government.
“The conclusions are very positive for Norsk Tipping and we also believe that Norsk Tipping fulfils the requirements laid down by the court to justify the monopoly”, comments Reidar Nordby Jr., President and Chief Executive Officer of Norsk Tipping AS.
The Norwegian Attorney General, Dr. Fredrik Sejersted, was also very pleased with the EFTA Court ruling, and stated that it confirms the consistency and legitimacy of the Norwegian gaming legislation.
However, as Ladbrokes claims that Norwegian legislation of gaming and gambling is in conflict with the EEA-Agreement, the case will continue in the Oslo City Court, but the advice from the EFTA Court give important signals to the future proceedings. The Court has not yet fixed the date for these proceedings.
For more information, please contact: Peer J. Svenkerud, Vice-President Information and External Relations, Ph: +47 91554368
02 June 2007
Casinos Austria International reports strong results for 2006
Gains recorded in all key figures, including a 12.1 % increase in international casino revenues and a 10.2 % rise in consolidated group revenues.
Vienna, 1 June 2007 - At a Casinos Austria Group Press Conference held in Grand Casino Luzern, the Vienna-based casino consulting, development and management company Casinos Austria International today announced strong results for the year ended 31.12.2006. Revenues (win, registered tips, entrance) at its 63 international casino operations rose by 12.1 % year-on-year to a record EUR 990 million (2005: EUR 883 million), with guest numbers for the period growing by 2.5 % to 16.6 million (2005: 16.2 million).
Casinos Austria International was delighted to report yet another year of strong growth, with the double digit increases offering further proof of the performance and growth potential of its operations worldwide. The increased productivity and profitability reflects the intensified efforts in the individual casinos as well as the corporate focus on strong growth areas and locations.
Highlights for the 2007 business year at Casinos Austria International included the Gala Opening of Grand Casino Brussels in the Belgian capital in January, the award of the license for the new casino in the central Chilean city of Los Angeles in July, the announcement of two further casinos in South Africa in November and the acquisition of a majority shareholding in its long-term partner in Argentina, ENJASA, in December.
All in all, Casinos Austria International can look back on a very successful year. In addition to the successful measures to increase productivity and profitability, important steps were also taken in a number of markets to ensure continued future growth. Given the strong potential in its existing operations and strategic growth opportunities established through its new projects in Brussels, Belgrade, South Africa and South America, the company is very optimistic about the future.
Group Results
In the same period, aggregate total revenues for the Casinos Austria Group (Casinos Austria AG, Casinos Austria International, Austrian Lotteries, CAST, win2day.at, tipp3 and WINWIN) increased by 10.2 % to a record EUR 3.35 billion (2005: EUR 3.04 billion), boosted by strong growth in its international casino and domestic lottery, internet gaming, sports betting and video lottery activities.
Revenues (win, registered tips, entrance) from the Group's casino sector activities (i.e. the 63 Casinos Austria International operations and the 12 casinos in Austria operated by the parent company Casinos Austria AG) increased by 7.6 % from EUR 1.17 billion in 2005 to a record EUR 1.26 billion in 2006. Together these 75 casinos in 18 countries and on board 10 cruise ships welcomed some 19 million visitors, a rise of 2.7 % year-on-year, and employed a total of 10,545 staff.
Outlook 2007
2007 has already begun on a positive note with continued growth in Casinos Austria International's existing operations and new developments in a number of key markets, including further acquisition projects in Europe, Asia and South America. Preparations are currently in full swing for the launch of phase one of Casino Beograd in the Serbian capital at the end of June, while work is also well underway in Chile for the opening of Casino Los Angeles in 2008. The concession agreements with Discovery Cruise Line and Regent Seven Seas Cruises were extended in the first quarter, while Silversea Cruises announced it would be adding another ship to the Casinos Austria International fleet in the second quarter.
For further information please contact:
Hermann Pamminger
Head of Corporate Relations and Customer Care
Casinos Austria International
Dr. Karl Lueger Ring 14
A-1015 Vienna
Tel. +43 1 53440 527
E-mail: hermann.pamminger@casinos.at
Vienna, 1 June 2007 - At a Casinos Austria Group Press Conference held in Grand Casino Luzern, the Vienna-based casino consulting, development and management company Casinos Austria International today announced strong results for the year ended 31.12.2006. Revenues (win, registered tips, entrance) at its 63 international casino operations rose by 12.1 % year-on-year to a record EUR 990 million (2005: EUR 883 million), with guest numbers for the period growing by 2.5 % to 16.6 million (2005: 16.2 million).
Casinos Austria International was delighted to report yet another year of strong growth, with the double digit increases offering further proof of the performance and growth potential of its operations worldwide. The increased productivity and profitability reflects the intensified efforts in the individual casinos as well as the corporate focus on strong growth areas and locations.
Highlights for the 2007 business year at Casinos Austria International included the Gala Opening of Grand Casino Brussels in the Belgian capital in January, the award of the license for the new casino in the central Chilean city of Los Angeles in July, the announcement of two further casinos in South Africa in November and the acquisition of a majority shareholding in its long-term partner in Argentina, ENJASA, in December.
All in all, Casinos Austria International can look back on a very successful year. In addition to the successful measures to increase productivity and profitability, important steps were also taken in a number of markets to ensure continued future growth. Given the strong potential in its existing operations and strategic growth opportunities established through its new projects in Brussels, Belgrade, South Africa and South America, the company is very optimistic about the future.
Group Results
In the same period, aggregate total revenues for the Casinos Austria Group (Casinos Austria AG, Casinos Austria International, Austrian Lotteries, CAST, win2day.at, tipp3 and WINWIN) increased by 10.2 % to a record EUR 3.35 billion (2005: EUR 3.04 billion), boosted by strong growth in its international casino and domestic lottery, internet gaming, sports betting and video lottery activities.
Revenues (win, registered tips, entrance) from the Group's casino sector activities (i.e. the 63 Casinos Austria International operations and the 12 casinos in Austria operated by the parent company Casinos Austria AG) increased by 7.6 % from EUR 1.17 billion in 2005 to a record EUR 1.26 billion in 2006. Together these 75 casinos in 18 countries and on board 10 cruise ships welcomed some 19 million visitors, a rise of 2.7 % year-on-year, and employed a total of 10,545 staff.
Outlook 2007
2007 has already begun on a positive note with continued growth in Casinos Austria International's existing operations and new developments in a number of key markets, including further acquisition projects in Europe, Asia and South America. Preparations are currently in full swing for the launch of phase one of Casino Beograd in the Serbian capital at the end of June, while work is also well underway in Chile for the opening of Casino Los Angeles in 2008. The concession agreements with Discovery Cruise Line and Regent Seven Seas Cruises were extended in the first quarter, while Silversea Cruises announced it would be adding another ship to the Casinos Austria International fleet in the second quarter.
For further information please contact:
Hermann Pamminger
Head of Corporate Relations and Customer Care
Casinos Austria International
Dr. Karl Lueger Ring 14
A-1015 Vienna
Tel. +43 1 53440 527
E-mail: hermann.pamminger@casinos.at
Board changes at Casinos Austria AG
Dr. Leo Wallner joins Supervisory Board, Dr. Karl Stoss takes over as Director General from 25 May 2007.
Vienna, 25 May 2007 - At the Annual General Meeting of Casinos Austria AG held today in Vienna, it was confirmed that Director General Dr. Leo Wallner has taken up his new role as Vice President of the Supervisory Board.
He is succeeded as Director General of Casinos Austria AG by Dr. Karl Stoss, Member of the Board of Directors since 1 January 2007 and Director General of Austrian Lotteries since 8 May 2007. Both changes are with immediate effect. President of the Supervisory Board is Dr. Walter Rothensteiner.
Leo Wallner has headed Casinos Austria since 15 February 1968, turning the company from a local casino operator into a highly respected and successful international gaming group.
Casinos Austria AG and its international subsidiary, Casinos Austria International, currently operate 71 top-class casinos in 18 countries and on board some of the world's most luxurious cruise ships. In 2006, In 2006, the two companies together posted revenues (wins, registered tips, entrance) of 1.26 billion euro (+7.6 %), welcomed some 19 million guests (+2.7 %) and employed around 10,545 staff.
With the founding of Austrian Lotteries, the launch of internet gaming, the introduction of Video Lottery Terminals outlets in Austria and a far-reaching international expansion strategy, Leo Wallner has given Casinos Austria an unrivalled mix of gaming services and laid the foundations for the future success of the Group.
For further information, please contact:
Hermann Pamminger
Head of Corporate Relations & Customer Care
Tel. +43 1 534 40 527
www.casinosaustria.com
Vienna, 25 May 2007 - At the Annual General Meeting of Casinos Austria AG held today in Vienna, it was confirmed that Director General Dr. Leo Wallner has taken up his new role as Vice President of the Supervisory Board.
He is succeeded as Director General of Casinos Austria AG by Dr. Karl Stoss, Member of the Board of Directors since 1 January 2007 and Director General of Austrian Lotteries since 8 May 2007. Both changes are with immediate effect. President of the Supervisory Board is Dr. Walter Rothensteiner.
Leo Wallner has headed Casinos Austria since 15 February 1968, turning the company from a local casino operator into a highly respected and successful international gaming group.
Casinos Austria AG and its international subsidiary, Casinos Austria International, currently operate 71 top-class casinos in 18 countries and on board some of the world's most luxurious cruise ships. In 2006, In 2006, the two companies together posted revenues (wins, registered tips, entrance) of 1.26 billion euro (+7.6 %), welcomed some 19 million guests (+2.7 %) and employed around 10,545 staff.
With the founding of Austrian Lotteries, the launch of internet gaming, the introduction of Video Lottery Terminals outlets in Austria and a far-reaching international expansion strategy, Leo Wallner has given Casinos Austria an unrivalled mix of gaming services and laid the foundations for the future success of the Group.
For further information, please contact:
Hermann Pamminger
Head of Corporate Relations & Customer Care
Tel. +43 1 534 40 527
www.casinosaustria.com
30 May 2007
EFTA Court reviews Norwegian legislation on gambling and betting
Judgment in Case E-3/06 Ladbrokes
In a judgment delivered today, the EFTA Court dealt with a case initiated by Ladbrokes Ltd. which is currently pending before the Oslo District Court. Established in the United Kingdom, Ladbrokes is the world’s largest bookmaker company. By its action, Ladbrokes essentially challenges the Norwegian regulation of the entire gambling and betting sector, namely (1) the Gaming Act, which establishes a monopoly for the state-owned company Norsk Tipping for the operation of games such as Lotto and sports betting; (2) the Totalisator Act, which is the legal basis for the exclusive right of operation of horserace betting granted to Norsk Rikstoto, a state-controlled foundation; and (3) the Lottery Act which provides that minor money games such as Bingo and scratch cards may only be operated by non-profit organisations and associations with a humanitarian or socially beneficial purpose. The Oslo District Court referred five questions to the EFTA Court.
The Court held that all games of chance provided in return for money payment constitute economic activities falling within the scope of EEA fundamental freedoms. A system based on an exclusive right as established under the Gaming and the Totalisator Acts, respectively, completely denies private operators access to the respective market and thus encroaches upon the freedom to provide services and the right of establishment. The same holds true for the prohibition on granting commercial operators permission to operate lotteries under the Lottery Act.
In order to be justified, the Norwegian legislation needs to be based on legitimate reasons of overriding general interest. In that respect, the Court accepted the aim of fighting gambling addiction and crime and malpractice as being legitimate. In order to be lawfully based on the aim of fighting gambling addiction, legislation must, however, reflect a concern to bring about a genuine diminution in gambling opportunities. The motive of financing benevolent or public-interest activities cannot in itself be regarded as an objective justification for restrictions on free movement. The aim of preventing gambling from being a source of private profit can serve as justification only if the legislation reflects a moral concern; if a state-owned monopoly is allowed to offer a range of gambling opportunities, the legislation at issue cannot be said to genuinely pursue this aim. Under the allocation of competences between the EFTA Court and the national court, it is for the latter to verify whether the Norwegian legislation may indeed be justified by legitimate objectives. With respect to the Totalisator Act, the EFTA Court noted that the legislative aim of financing the commercial breeding of horses does not qualify as a legitimate reason in the public interest.
To the extent Norwegian legislation is found to pursue legitimate aims, the national court must consider whether the Norwegian legislation at issue is proportionate. Whilst the states are free to define the level of protection sought, the policy pursued would be inconsistent if the state took, facilitated or tolerated other measures which run counter to the objectives pursued. In the context of the Gaming Act, it is the marketing activities and the development of new games by Norsk Tipping in particular that are relevant when assessing consistency.
Finally, the national court was instructed that it must examine whether the legislation at issue goes beyond what is necessary to meet the aims pursued. Again, the level of protection chosen by the Norwegian authorities is decisive. Where other, less restrictive measures would have the effect of fully achieving the objectives at the level of protection chosen, an exclusive rights system could not be considered necessary simply because it might offer an even higher level of protection. In order to carry out its assessment, the national court must ascertain whether and to which extent there are genuine risks arising from or connected to the different games of chance. It will also have to examine whether Norsk Tipping has less economic incentives to breach the applicable rules, or less of an interest in an aggressive marketing strategy than a commercial operator under a licensing system.
In answering an additional question posed by the national court, the EFTA Court finally held that to the extent the national court concludes that the restrictions entailed by the three Acts in question are lawful, the State also has the right to prohibit the providing and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin. To the extent the national court finds that the bans implied in the three Acts on commercial operators organising any form of gambling are not justified, the Norwegian State may still require foreign operators to seek a national licence under the same conditions as apply to domestic operators. This would, however, be excessive if the company in question already held a licence issued by its home state and the requirements to which the issue of a licence is subject coincided with the requirements already fulfilled in that latter state.
The full text of the judgment may be found on the Internet at: www.eftacourt.lu.
This press release is not an official document. Please note that the Court may not comment on the case.
press release of the EFTA Court
In a judgment delivered today, the EFTA Court dealt with a case initiated by Ladbrokes Ltd. which is currently pending before the Oslo District Court. Established in the United Kingdom, Ladbrokes is the world’s largest bookmaker company. By its action, Ladbrokes essentially challenges the Norwegian regulation of the entire gambling and betting sector, namely (1) the Gaming Act, which establishes a monopoly for the state-owned company Norsk Tipping for the operation of games such as Lotto and sports betting; (2) the Totalisator Act, which is the legal basis for the exclusive right of operation of horserace betting granted to Norsk Rikstoto, a state-controlled foundation; and (3) the Lottery Act which provides that minor money games such as Bingo and scratch cards may only be operated by non-profit organisations and associations with a humanitarian or socially beneficial purpose. The Oslo District Court referred five questions to the EFTA Court.
The Court held that all games of chance provided in return for money payment constitute economic activities falling within the scope of EEA fundamental freedoms. A system based on an exclusive right as established under the Gaming and the Totalisator Acts, respectively, completely denies private operators access to the respective market and thus encroaches upon the freedom to provide services and the right of establishment. The same holds true for the prohibition on granting commercial operators permission to operate lotteries under the Lottery Act.
In order to be justified, the Norwegian legislation needs to be based on legitimate reasons of overriding general interest. In that respect, the Court accepted the aim of fighting gambling addiction and crime and malpractice as being legitimate. In order to be lawfully based on the aim of fighting gambling addiction, legislation must, however, reflect a concern to bring about a genuine diminution in gambling opportunities. The motive of financing benevolent or public-interest activities cannot in itself be regarded as an objective justification for restrictions on free movement. The aim of preventing gambling from being a source of private profit can serve as justification only if the legislation reflects a moral concern; if a state-owned monopoly is allowed to offer a range of gambling opportunities, the legislation at issue cannot be said to genuinely pursue this aim. Under the allocation of competences between the EFTA Court and the national court, it is for the latter to verify whether the Norwegian legislation may indeed be justified by legitimate objectives. With respect to the Totalisator Act, the EFTA Court noted that the legislative aim of financing the commercial breeding of horses does not qualify as a legitimate reason in the public interest.
To the extent Norwegian legislation is found to pursue legitimate aims, the national court must consider whether the Norwegian legislation at issue is proportionate. Whilst the states are free to define the level of protection sought, the policy pursued would be inconsistent if the state took, facilitated or tolerated other measures which run counter to the objectives pursued. In the context of the Gaming Act, it is the marketing activities and the development of new games by Norsk Tipping in particular that are relevant when assessing consistency.
Finally, the national court was instructed that it must examine whether the legislation at issue goes beyond what is necessary to meet the aims pursued. Again, the level of protection chosen by the Norwegian authorities is decisive. Where other, less restrictive measures would have the effect of fully achieving the objectives at the level of protection chosen, an exclusive rights system could not be considered necessary simply because it might offer an even higher level of protection. In order to carry out its assessment, the national court must ascertain whether and to which extent there are genuine risks arising from or connected to the different games of chance. It will also have to examine whether Norsk Tipping has less economic incentives to breach the applicable rules, or less of an interest in an aggressive marketing strategy than a commercial operator under a licensing system.
In answering an additional question posed by the national court, the EFTA Court finally held that to the extent the national court concludes that the restrictions entailed by the three Acts in question are lawful, the State also has the right to prohibit the providing and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin. To the extent the national court finds that the bans implied in the three Acts on commercial operators organising any form of gambling are not justified, the Norwegian State may still require foreign operators to seek a national licence under the same conditions as apply to domestic operators. This would, however, be excessive if the company in question already held a licence issued by its home state and the requirements to which the issue of a licence is subject coincided with the requirements already fulfilled in that latter state.
The full text of the judgment may be found on the Internet at: www.eftacourt.lu.
This press release is not an official document. Please note that the Court may not comment on the case.
press release of the EFTA Court
bwin: Judgement by EFTA Court underlines narrow limits for gaming monopolies in Europe
The EFTA Court today passed down a further judgement on the Norwegian gaming monopoly. The court was called upon to decide whether monopolies were admissible for horse betting, sports betting and lotteries.
The reasoning behind the EFTA Court's judgement is entirely in line with the judgements by the European Court of Justice in the Gambelli and Placanica cases. According to these judgements, a monopoly may be permissible if a country's entire gaming policy is consistently designed to reduce gaming opportunities. Besides, any measures introduced by a government must also be necessary, proportionate and coherent. In this context, the court also laid down detailed criteria, stating that the burden of proof lay with each member state.
The court also went on to emphasize that an international provider cannot be denied access to any market if that country's monopolistic system is neither appropriate, proportionate nor necessary.
"The court's judgement confirms the criticism already expressed by the European Commission of the national restrictions that still exist in some cases," commented Norbert Teufelberger, bwin Co-CEO. "As long as national legislators are unable to agree on uniform pan-European regulations for the gaming market, national regulations will continue to be evaluated in the light of the freedoms of establishment and services anchored in the Treaty on European Community and the prohibition of discrimination."
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Bundesliga. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
press release of bwin
The reasoning behind the EFTA Court's judgement is entirely in line with the judgements by the European Court of Justice in the Gambelli and Placanica cases. According to these judgements, a monopoly may be permissible if a country's entire gaming policy is consistently designed to reduce gaming opportunities. Besides, any measures introduced by a government must also be necessary, proportionate and coherent. In this context, the court also laid down detailed criteria, stating that the burden of proof lay with each member state.
The court also went on to emphasize that an international provider cannot be denied access to any market if that country's monopolistic system is neither appropriate, proportionate nor necessary.
"The court's judgement confirms the criticism already expressed by the European Commission of the national restrictions that still exist in some cases," commented Norbert Teufelberger, bwin Co-CEO. "As long as national legislators are unable to agree on uniform pan-European regulations for the gaming market, national regulations will continue to be evaluated in the light of the freedoms of establishment and services anchored in the Treaty on European Community and the prohibition of discrimination."
The bwin Group has over 11 million registered customers (including 7 million "play money" customers) in over 20 core target markets. Operating under international and regional licences in countries like Gibraltar, Kahnawake (Canada), Belize and Germany, Italy, Mexico, Argentina, Austria and the United Kingdom, the Group is the number one address for sports betting, games and entertainment via digital distribution channels. The Group offers sports betting, poker, casino games, soft and skill games, as well as audio and video streams on top sporting events such as the German Bundesliga. The parent company, bwin Interactive Entertainment AG, has been listed on the Vienna Stock Exchange since March 2000 (ID code "BWIN", Reuters ID code "BWIN.VI"). All details about the company can be found on its investor relations website at www.bwin.ag.
press release of bwin
EFTA Court pronounces Ladbrokes decision
The EFTA Court delivered its judgement in Case E-3/06 (Ladbrokes Ltd. v Staten v/Kultur- og kirkedepartementet and Staten v/Landbruks- og matdepartementet) in open Court today. The Court decided:
1.–3. In order not to be precluded by Articles 31 and 36 EEA, national legislation which establishes (1) that certain forms of gaming may only be offered by a State-owned gaming company which channels its profits to cultural and sports purposes, (2) that a licence to offer horserace betting may only be granted to non-profit organisations or companies whose aim is to support horse breeding, or (3) that licences to offer certain forms of gaming may only be granted to non-profit organisations and associations with a humanitarian or socially beneficial purpose, must pursue legitimate aims such as fighting gambling addiction and maintaining public order. The legitimate aims must be pursued in a suitable and consistent manner, and the legislation must not go beyond what is necessary in order to achieve the aims in question.
4. Under EEA law, the financing of humanitarian and socially beneficial purposes may not constitute the real justification for legislation such as the legislation at issue, but only a beneficial consequence which is incidental, in the meaning that it is accessory. Preventing private profit as an aim in itself may, on the other hand, in principle justify such legislation. However, the national gaming policy must then reflect the moral concerns underlying this aim.
5. Under Article 36 EEA, to the extent the national court concludes that the exclusive rights systems established under the Gaming Act and the Totalisator Act constitute lawful restrictions, national authorities have the right to ban the provision and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin. The same applies to the extent the national court concludes that the exclusion of commercial operators under the Lottery Act constitutes a lawful restriction on the free movement of services.
To the extent the national court comes to the conclusion that the bans implied in the three Acts on commercial operators organising any form of game of chance are not justified, the answer must be that a licence may still be required in view of possible differences in the level of protection throughout the EEA. However, national measures must not be excessive in relation to the aims pursued. They have to be non-discriminatory and must take into account the requirements already fulfilled by the provider of the services for the pursuit of activities in the home State.
1.–3. In order not to be precluded by Articles 31 and 36 EEA, national legislation which establishes (1) that certain forms of gaming may only be offered by a State-owned gaming company which channels its profits to cultural and sports purposes, (2) that a licence to offer horserace betting may only be granted to non-profit organisations or companies whose aim is to support horse breeding, or (3) that licences to offer certain forms of gaming may only be granted to non-profit organisations and associations with a humanitarian or socially beneficial purpose, must pursue legitimate aims such as fighting gambling addiction and maintaining public order. The legitimate aims must be pursued in a suitable and consistent manner, and the legislation must not go beyond what is necessary in order to achieve the aims in question.
4. Under EEA law, the financing of humanitarian and socially beneficial purposes may not constitute the real justification for legislation such as the legislation at issue, but only a beneficial consequence which is incidental, in the meaning that it is accessory. Preventing private profit as an aim in itself may, on the other hand, in principle justify such legislation. However, the national gaming policy must then reflect the moral concerns underlying this aim.
5. Under Article 36 EEA, to the extent the national court concludes that the exclusive rights systems established under the Gaming Act and the Totalisator Act constitute lawful restrictions, national authorities have the right to ban the provision and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin. The same applies to the extent the national court concludes that the exclusion of commercial operators under the Lottery Act constitutes a lawful restriction on the free movement of services.
To the extent the national court comes to the conclusion that the bans implied in the three Acts on commercial operators organising any form of game of chance are not justified, the answer must be that a licence may still be required in view of possible differences in the level of protection throughout the EEA. However, national measures must not be excessive in relation to the aims pursued. They have to be non-discriminatory and must take into account the requirements already fulfilled by the provider of the services for the pursuit of activities in the home State.
26 May 2007
State Monopolies: ECJ examines sports betting in Germany and Portugal
World Online Gaming Law Report, April 2007 (Volume 6 Issue 4)
Courts in Germany and Portugal have recently referred cases concerning sports betting monopolies to the European Court of Justice. Martin Arendts, Attorney at Law with Arendts Anwälte, explains how these cases give the ECJ a further chance to clarify the law regarding state monopolies, following its rulings in the Italian cases of Zenatti, Gambelli and Placanica.
Open questions
In its Placanica decision of 6 March 20071, the ECJ ruled that it is inconsistent with Community law to criminally sanction the cross-border provision of sports betting. However, several questions remained open. National courts still argue under what circumstances a monopoly with regard to sports betting can be upheld under Community law, after Italy opted for a licensing concept. Therefore, several German courts drew the conclusion that they do not have to take the Placanica reasoning into consideration at all2. In his opinion on the Placanica case, the Advocate General Colomer hinted to the country of origin principle, by arguing: 'Therefore, if an operator from another Member State meets the requirements applicable in that State, the national authorities of the Member State in which the service is provided should accept that as a sufficient guarantee of the integrity of the operator3'. In its judgment, the ECJ already held the Italian regulation to be inconsistent, so it did not take a stand on this argument.
References for preliminary rulings by the ECJ
Now, it is for the ECJ to decide these open questions. A Portuguese court, the Tribunal de Pequena Instância Criminal do Porto, has referred key questions on the compatibility of gambling monopolies under Community law to the ECJ (Case C-42/07).
The background of this case is an ongoing dispute between the Portuguese monopoly operator, Santa Casa da Misericordia de Lisboa, and Gibraltar-based Baw International Ltd (a subsidiary of listed company, bwin). The dispute revolves around Baw's existing sponsorship of the Portuguese professional football league (Liga Portuguesa de Futebol Profissional), which Santa Casa has tried to have annulled by Portuguese courts, claiming that the sponsorship contravenes Portuguese advertising law. Portugal's advertising code specifically states that the advertising of games of chance is prohibited, except for games developed by Santa Casa. Baw International Ltd, along with the Liga Portuguesa, to whom Bwin's sponsorship is worth up to €10 million over the next four years, brought forward that Santa Casa's privileged position as a monopoly operator of all lottery, betting and internet games contravenes Community law.
As well as being certain to make an impact in Portugal, the questions the Porto court has referred to the ECJ are of great interest in a broader European context.
The court referred the following:
- Does the monopoly granted to Santa Casa [da Misericórdia de Lisboa], when relied on against Baw [International Ltd], that is to say, against a provider of services established in another Member State in which it lawfully provides similar services, which has no physical establishment in Portugal, constitute an impediment to the free provision of services, in breach of the principles of freedom to provide services, freedom of establishment and the free movement of payments enshrined in Articles 49, 43 and 56 respectively of the EC Treaty?
- Is it contrary to Community law, in particular to the abovementioned principles, for rules of domestic law such as those at issue in the main proceedings, first to establish a monopoly in favour of a single body for the operation of lotteries and mutual betting and then to extend that monopoly to 'the entire national territory, including ... the internet'?
Separately, the Administrative Court of Giessen in Germany referred a German sports betting case to the ECJ4. Last year, the Administrative Court of Cologne had referred a first case to Luxemburg5. However, this case (C-409/06 - Winner Wetten) only deals with the temporary suspension of the basic freedoms, guaranteed by the EC Treaty, with regard to sports betting (as the Administrative Court of Appeal of North Rhine-Westphalia openly suspended the freedom to provide services and the freedom of establishment in more than 200 cases concerning betting shops).
The new German case has a much broader scope. On the one hand, the German court explicitly asked the ECJ whether a sports betting monopoly is consistent with Community law, if the authorities encourage the participation in gambling and if private operators are allowed to offer gambling services with equal or even higher risks compared with sports betting, e.g. horse betting, slot machines or casinos. On the other hand, the German court wants to know if operators from other Member States can rely on their foreign license, as the German regulations do not provide for a licensing procedure consistent with the requirements of Community law.
Possible consequences of the upcoming decisions
Both the German and Portuguese cases require the ECJ to explicate under what circumstances and requirements a national monopoly can be upheld, effectively excluding operators licensed in other EU Member States. Should an operator licensed in one Member State be allowed to offer its services throughout the EU? If the answer is 'Yes', the existing national monopolies will probably not survive.
I expect the ECJ to further develop the consistency test and to question the coherency of national regulations. In this context, the ECJ will have to answer whether it is contrary to Community law for a Member State to extend a monopoly to the internet. Most of Europe's more embattled monopoly operators have gone online, including Française des Jeux, Svenska Spel and Holland Casino. German state lottery companies proposed last year to uphold their monopolies and to avoid anti-trust law problems by shutting down the use of the internet for all gambling services. The draft of the new German Interstate Treaty on Gambling (Glücksspiel-Staatsvertrag) provides for a complete ban of the provision and advertising over the internet. However, the European Commission, in a formal letter to the German government, has already declared this ban to be inconsistent with Community law. In this context, the ECJ might also exemplify whether it is against Community law to blacklist websites of operators licensed in other Member States (as Italy already tried to do with Maltese websites).
It is also interesting to note that the Portuguese court not only referred to the freedom to provide services and the freedom of establishment (as in the previous cases), but also to the free movement of payments. Taking the Unlawful Internet Gambling Enforcement Act (UIGEA) as a model, several Member States are planning to restrict and block payments to foreign sports betting and gambling operators. In Germany, the draft of the new Interstate Treaty explicitly addresses payment solutions.
It is not very likely that the ECJ will accept this. It is also likely that the ECJ will disapprove the theory, brought forward by the Administrative Court of Appeal of North RhineWestphalia and followed by some German courts, that national courts are entitled to suspend the basic freedoms, simply by arguing with stability of the law and a loophole in the law.
Martin Arendts
Attorney at Law
Arendts Anwälte
martin.arendts@anlageanwalt.de
footnotes:
1. Joined Cases C-338/04, C-359/04 and C-360/04.
2. For example, the Administrative Court of Appeal of Rhineland-Palatia (Oberverwaltungsgericht RheinlandPfalz), decision of 2 May 2007, file-no. 6 B 10118/07.OVG.
3. Opinion of Advocate General Colomer, delivered on 16 May 2006, paragraph 130.
4. Administrative Court of Giessen, decision of 7 May 2007, file-no. 10 E 13/07.
5. Adminstrative Court of Cologne, decision of 21 September 2006, file-no. 1 K 5910/05.
Courts in Germany and Portugal have recently referred cases concerning sports betting monopolies to the European Court of Justice. Martin Arendts, Attorney at Law with Arendts Anwälte, explains how these cases give the ECJ a further chance to clarify the law regarding state monopolies, following its rulings in the Italian cases of Zenatti, Gambelli and Placanica.
Open questions
In its Placanica decision of 6 March 20071, the ECJ ruled that it is inconsistent with Community law to criminally sanction the cross-border provision of sports betting. However, several questions remained open. National courts still argue under what circumstances a monopoly with regard to sports betting can be upheld under Community law, after Italy opted for a licensing concept. Therefore, several German courts drew the conclusion that they do not have to take the Placanica reasoning into consideration at all2. In his opinion on the Placanica case, the Advocate General Colomer hinted to the country of origin principle, by arguing: 'Therefore, if an operator from another Member State meets the requirements applicable in that State, the national authorities of the Member State in which the service is provided should accept that as a sufficient guarantee of the integrity of the operator3'. In its judgment, the ECJ already held the Italian regulation to be inconsistent, so it did not take a stand on this argument.
References for preliminary rulings by the ECJ
Now, it is for the ECJ to decide these open questions. A Portuguese court, the Tribunal de Pequena Instância Criminal do Porto, has referred key questions on the compatibility of gambling monopolies under Community law to the ECJ (Case C-42/07).
The background of this case is an ongoing dispute between the Portuguese monopoly operator, Santa Casa da Misericordia de Lisboa, and Gibraltar-based Baw International Ltd (a subsidiary of listed company, bwin). The dispute revolves around Baw's existing sponsorship of the Portuguese professional football league (Liga Portuguesa de Futebol Profissional), which Santa Casa has tried to have annulled by Portuguese courts, claiming that the sponsorship contravenes Portuguese advertising law. Portugal's advertising code specifically states that the advertising of games of chance is prohibited, except for games developed by Santa Casa. Baw International Ltd, along with the Liga Portuguesa, to whom Bwin's sponsorship is worth up to €10 million over the next four years, brought forward that Santa Casa's privileged position as a monopoly operator of all lottery, betting and internet games contravenes Community law.
As well as being certain to make an impact in Portugal, the questions the Porto court has referred to the ECJ are of great interest in a broader European context.
The court referred the following:
- Does the monopoly granted to Santa Casa [da Misericórdia de Lisboa], when relied on against Baw [International Ltd], that is to say, against a provider of services established in another Member State in which it lawfully provides similar services, which has no physical establishment in Portugal, constitute an impediment to the free provision of services, in breach of the principles of freedom to provide services, freedom of establishment and the free movement of payments enshrined in Articles 49, 43 and 56 respectively of the EC Treaty?
- Is it contrary to Community law, in particular to the abovementioned principles, for rules of domestic law such as those at issue in the main proceedings, first to establish a monopoly in favour of a single body for the operation of lotteries and mutual betting and then to extend that monopoly to 'the entire national territory, including ... the internet'?
Separately, the Administrative Court of Giessen in Germany referred a German sports betting case to the ECJ4. Last year, the Administrative Court of Cologne had referred a first case to Luxemburg5. However, this case (C-409/06 - Winner Wetten) only deals with the temporary suspension of the basic freedoms, guaranteed by the EC Treaty, with regard to sports betting (as the Administrative Court of Appeal of North Rhine-Westphalia openly suspended the freedom to provide services and the freedom of establishment in more than 200 cases concerning betting shops).
The new German case has a much broader scope. On the one hand, the German court explicitly asked the ECJ whether a sports betting monopoly is consistent with Community law, if the authorities encourage the participation in gambling and if private operators are allowed to offer gambling services with equal or even higher risks compared with sports betting, e.g. horse betting, slot machines or casinos. On the other hand, the German court wants to know if operators from other Member States can rely on their foreign license, as the German regulations do not provide for a licensing procedure consistent with the requirements of Community law.
Possible consequences of the upcoming decisions
Both the German and Portuguese cases require the ECJ to explicate under what circumstances and requirements a national monopoly can be upheld, effectively excluding operators licensed in other EU Member States. Should an operator licensed in one Member State be allowed to offer its services throughout the EU? If the answer is 'Yes', the existing national monopolies will probably not survive.
I expect the ECJ to further develop the consistency test and to question the coherency of national regulations. In this context, the ECJ will have to answer whether it is contrary to Community law for a Member State to extend a monopoly to the internet. Most of Europe's more embattled monopoly operators have gone online, including Française des Jeux, Svenska Spel and Holland Casino. German state lottery companies proposed last year to uphold their monopolies and to avoid anti-trust law problems by shutting down the use of the internet for all gambling services. The draft of the new German Interstate Treaty on Gambling (Glücksspiel-Staatsvertrag) provides for a complete ban of the provision and advertising over the internet. However, the European Commission, in a formal letter to the German government, has already declared this ban to be inconsistent with Community law. In this context, the ECJ might also exemplify whether it is against Community law to blacklist websites of operators licensed in other Member States (as Italy already tried to do with Maltese websites).
It is also interesting to note that the Portuguese court not only referred to the freedom to provide services and the freedom of establishment (as in the previous cases), but also to the free movement of payments. Taking the Unlawful Internet Gambling Enforcement Act (UIGEA) as a model, several Member States are planning to restrict and block payments to foreign sports betting and gambling operators. In Germany, the draft of the new Interstate Treaty explicitly addresses payment solutions.
It is not very likely that the ECJ will accept this. It is also likely that the ECJ will disapprove the theory, brought forward by the Administrative Court of Appeal of North RhineWestphalia and followed by some German courts, that national courts are entitled to suspend the basic freedoms, simply by arguing with stability of the law and a loophole in the law.
Martin Arendts
Attorney at Law
Arendts Anwälte
martin.arendts@anlageanwalt.de
footnotes:
1. Joined Cases C-338/04, C-359/04 and C-360/04.
2. For example, the Administrative Court of Appeal of Rhineland-Palatia (Oberverwaltungsgericht RheinlandPfalz), decision of 2 May 2007, file-no. 6 B 10118/07.OVG.
3. Opinion of Advocate General Colomer, delivered on 16 May 2006, paragraph 130.
4. Administrative Court of Giessen, decision of 7 May 2007, file-no. 10 E 13/07.
5. Adminstrative Court of Cologne, decision of 21 September 2006, file-no. 1 K 5910/05.
22 May 2007
EFTA Court decides on gambling monopoly
by Attorney-at-Law Martin Arendts, M.B.L.-HSG
The EFTA Court will deliver its judgement in the Ladbrokes case on Wednesday, 30 May 2007 at 15:00 hrs. In this case regarding the British bookmaker Ladbrokers Ltd. against two Norwegian government departments, the Oslo District Court (Oslo Tingrett) requested an Advisory Opinion of the EFTA Court on several questions.
The relevant provisions of the European Economic Area (EEA) Agreement correspond with those of the EC Treaty. Therefore, the decision to be rendered in this case (Case E-3/06) is of significant importance for the European Union as well. Several EU Member States (Belgium, Germany, Finland, France, Greece, Portugal, Spain, Slovenia and the Netherlands) have filed briefs with the court.
The EFTA Court will decide on the following five questions regarding the legality of a state monopoly and the freedom to provide gaming services:
1. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that certain forms of gaming may only be offered by a State-owned gambling company which channels its profits to cultural and sports purposes?
2. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that licences to offer horserace betting may only be granted to non-profit organisations or companies whose aim is to support horse breeding?
3. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that licences to certain forms of gaming may only be granted to non-profit organisations and associations with a humanitarian or socially beneficial purpose?
4. Under EEA law, is it legitimate for national legislation to emphasise that the profit from gaming should go to humanitarian and socially beneficial purposes (including sports and culture), and not to be a source of private profit?
5. Does EEA Article 36 preclude a national statutory provision which forbids the providing and marketing of gaming which is not permitted in Norway, but which approved under national law in another EEA State?
The EFTA Court will deliver its judgement in the Ladbrokes case on Wednesday, 30 May 2007 at 15:00 hrs. In this case regarding the British bookmaker Ladbrokers Ltd. against two Norwegian government departments, the Oslo District Court (Oslo Tingrett) requested an Advisory Opinion of the EFTA Court on several questions.
The relevant provisions of the European Economic Area (EEA) Agreement correspond with those of the EC Treaty. Therefore, the decision to be rendered in this case (Case E-3/06) is of significant importance for the European Union as well. Several EU Member States (Belgium, Germany, Finland, France, Greece, Portugal, Spain, Slovenia and the Netherlands) have filed briefs with the court.
The EFTA Court will decide on the following five questions regarding the legality of a state monopoly and the freedom to provide gaming services:
1. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that certain forms of gaming may only be offered by a State-owned gambling company which channels its profits to cultural and sports purposes?
2. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that licences to offer horserace betting may only be granted to non-profit organisations or companies whose aim is to support horse breeding?
3. Do EEA Articles 31 and/or 36 preclude national legislation which establishes that licences to certain forms of gaming may only be granted to non-profit organisations and associations with a humanitarian or socially beneficial purpose?
4. Under EEA law, is it legitimate for national legislation to emphasise that the profit from gaming should go to humanitarian and socially beneficial purposes (including sports and culture), and not to be a source of private profit?
5. Does EEA Article 36 preclude a national statutory provision which forbids the providing and marketing of gaming which is not permitted in Norway, but which approved under national law in another EEA State?
21 May 2007
Yahoo! and Eurosport have launched co-branded websites
Yahoo! and Eurosport have launched co-branded websites in four European markets dedicated to online sports news and community interaction.
The websites will operate in the UK and Ireland, Germany, Spain and Italy and combine Eurosport’s content and sports editorial with Yahoo!´s social media platform.
The new sites will be promoted on both Eurosport channels as well as on Yahoo! across all four markets.
“Together we're able to satisfy fans´ passion for sport by building user communities of interest around unrivalled high-quality professional content.’ said Javier Rodriguez Zapatero, Vice President Sales, Yahoo! Europe.
The new websites will offer numerous opportunities for advertisers, added Laurent Eric Le Lay, Chairman and CEO of Eurosport. “We are building a powerhouse that integrates both Eurosport and Yahoo! resources to provide a better user experience and a highly attractive, continent-wide audience for advertisers in an unrivalled on air/online cross media offer,” he said.
The co-branded sites are at: http://uk.eurosport.yahoo.com, http://de.eurosport.yahoo.com, http://es.eurosport.yahoo.com and http://it.eurosport.yahoo.com
sportbusiness.com
The websites will operate in the UK and Ireland, Germany, Spain and Italy and combine Eurosport’s content and sports editorial with Yahoo!´s social media platform.
The new sites will be promoted on both Eurosport channels as well as on Yahoo! across all four markets.
“Together we're able to satisfy fans´ passion for sport by building user communities of interest around unrivalled high-quality professional content.’ said Javier Rodriguez Zapatero, Vice President Sales, Yahoo! Europe.
The new websites will offer numerous opportunities for advertisers, added Laurent Eric Le Lay, Chairman and CEO of Eurosport. “We are building a powerhouse that integrates both Eurosport and Yahoo! resources to provide a better user experience and a highly attractive, continent-wide audience for advertisers in an unrivalled on air/online cross media offer,” he said.
The co-branded sites are at: http://uk.eurosport.yahoo.com, http://de.eurosport.yahoo.com, http://es.eurosport.yahoo.com and http://it.eurosport.yahoo.com
sportbusiness.com
10 May 2007
Portuguese court refers sports betting case to European Court of Justice
A Portuguese court, Tribunal de Pequena Instância Criminal do Porto, has referred a sport betting case to the European Court of Justice (ECJ). The proceeding is dealt by the ECJ as Case C-42/07.
Parties to the main proceedings are Liga Portuguesa de Futebol Profissional (CA/LPFP) and Baw International Ltd as applicants and Departamento de Jogos da Santa Casa da Misericórdia de Lisboa as defendant.
The Portuguese court referred following questions to the ECJ:
1. Does the monopoly granted to Santa Casa [da Misericórdia de Lisboa], when relied on against Baw [International Ltd], that is to say, against a provider of services established in another Member State in which it lawfully provides similar services, which has no physical establishment in Portugal, constitute an impediment to the free provision of services, in breach of the principles of freedom to provide services, freedom of establishment and the free movement of payments enshrined in Articles 49, 43 and 56 respectively of the EC Treaty?
2. Is it contrary to Community law, in particular to the abovementioned principles, for rules of domestic law such as those at issue in the main proceedings first to establish a monopoly in favour of a single body for the operation of lotteries and mutual betting and then to extend that monopoly to ‘the entire national territory, including … the internet’?
Parties to the main proceedings are Liga Portuguesa de Futebol Profissional (CA/LPFP) and Baw International Ltd as applicants and Departamento de Jogos da Santa Casa da Misericórdia de Lisboa as defendant.
The Portuguese court referred following questions to the ECJ:
1. Does the monopoly granted to Santa Casa [da Misericórdia de Lisboa], when relied on against Baw [International Ltd], that is to say, against a provider of services established in another Member State in which it lawfully provides similar services, which has no physical establishment in Portugal, constitute an impediment to the free provision of services, in breach of the principles of freedom to provide services, freedom of establishment and the free movement of payments enshrined in Articles 49, 43 and 56 respectively of the EC Treaty?
2. Is it contrary to Community law, in particular to the abovementioned principles, for rules of domestic law such as those at issue in the main proceedings first to establish a monopoly in favour of a single body for the operation of lotteries and mutual betting and then to extend that monopoly to ‘the entire national territory, including … the internet’?
09 May 2007
Nationalisation of Lotto Rheinland-Pfalz?
The state government of Rhineland-Palatia, one of the 16 German states (Länder), announced plans to nationalise Lotto Rheinland-Pfalz GmbH. Lotto Rheinland-Pfalz GmbH is the monopoly operator of lotteries and sports betting in Rhineland-Palatia and a member of Deutscher Lotto- und Totoblock, the cartel of the monopoly operators in Germany.
Until now, Lotto Rheinland-Pfalz GmbH is not owned by the state (unlike the other 15 monopoly operators), but by three state sports associations. The state government wants to change this in order to avoid a tendering procedure. In a recent letter to the German government, the EU Commission complained that there was no public invitation to tender.
Until now, Lotto Rheinland-Pfalz GmbH is not owned by the state (unlike the other 15 monopoly operators), but by three state sports associations. The state government wants to change this in order to avoid a tendering procedure. In a recent letter to the German government, the EU Commission complained that there was no public invitation to tender.
08 May 2007
German court refers sports betting case to the European Court of Justice
by Attorney-at-Law Martin Arendts, M.B.L.-HSG
Yesterday, the Administrative Court of Gießen referred a second German sports betting case to the European Court of Justice (ECJ) according to Art. 234 EC Treaty (decision of 7 May 2007, file-no. 10 E 13/07).
Recently, the Administrative Court of Cologne had referred a first case to the ECJ (decision of 21 September 2006, file-no. 1 K 5910/05). However, this case (C-409/06 – Winner Wetten) only deals with the temporary suspension of the basic freedoms, guaranteed by the EC Treaty, with regard to sports betting (as the Administrative Court of Appeal of North Rhine-Westphalia openly suspended the freedom to provide services and the freedom of establishment in more than 200 court cases concerning betting shops).
The new case has a much broader scope. On the on hand side, the Administrative Court of Gießen asked the ECJ whether a sports betting monopoly is consistent with Community law, if the authorities encourage the participation in gambling and if private operators are allowed to offer gambling services with equal or even higher risks compared with sports betting, e.g. horse betting, slot machines or casinos. On the other hand, the German court wants to know, if operators from other Member States can rely on their foreign license, as the German regulations does not provide for a licensing procedure consistent with the requirements of Community law.
Yesterday, the Administrative Court of Gießen referred a second German sports betting case to the European Court of Justice (ECJ) according to Art. 234 EC Treaty (decision of 7 May 2007, file-no. 10 E 13/07).
Recently, the Administrative Court of Cologne had referred a first case to the ECJ (decision of 21 September 2006, file-no. 1 K 5910/05). However, this case (C-409/06 – Winner Wetten) only deals with the temporary suspension of the basic freedoms, guaranteed by the EC Treaty, with regard to sports betting (as the Administrative Court of Appeal of North Rhine-Westphalia openly suspended the freedom to provide services and the freedom of establishment in more than 200 court cases concerning betting shops).
The new case has a much broader scope. On the on hand side, the Administrative Court of Gießen asked the ECJ whether a sports betting monopoly is consistent with Community law, if the authorities encourage the participation in gambling and if private operators are allowed to offer gambling services with equal or even higher risks compared with sports betting, e.g. horse betting, slot machines or casinos. On the other hand, the German court wants to know, if operators from other Member States can rely on their foreign license, as the German regulations does not provide for a licensing procedure consistent with the requirements of Community law.
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