Amendment to Polish Gambling Act adopted

Last Thursday (Sejm) and Friday (Senat), an amendment to the Polish Gambling Act was adopted. Once signed by the Polish president and published, it will come into force on 1 April 2017. Its official aim is to increase the protection of players against risks related to excessive gambling and to decrease the unlicensed market. However, it extends the number of games permitted in Poland and includes a couple of revolutionary changes: Read the rest of this entry »

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Casinos Given Green Light in Japan

On December 15th 2016, the National Diet officially opened Japan’s doors to Casino gambling by passing the ‘Integrated Resort Promotion Act’, which lays the groundwork for the legalization of Casinos in Japan. If the process continues smoothly, casinos will be operating in Japan after the 2020 Tokyo Olympics.

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Filmspeler – Advocate General applies linking case law to Internet media players

By John Cloke, John Wilks and Alastair Mackichan

Hot on the coattails of the CJEU’s ruling in GS Media (see here), the court’s Advocate General has come down hard on the seller of pre-configured media players which give access to pirated content over the Internet, in his advisory opinion in the Filmspeler case delivered last week.

In the AG’s view, the sale of such pre-configured devices itself constitutes a communication to the public and he also dismissed the application of the temporary copying defence in relation to reproduction of copyright works on such devices.

The opinion, whilst only advisory in nature, will be welcomed by rightsholders and broadcasters whose content is unlawfully redistributed via media players which are loaded with applications which give access to pirated content (such as Kodi-powered applications). The CJEU’s judgment is expected around March 2017.

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China: Michael Jordan finally slam dunks his naming rights claim at the Supreme People’s Court

This is a very important decision because it sets a strong judicial precedent for foreign companies seeking to protect their intellectual property rights in China.

On 8 December 2016, overturning the lower court decisions against Michael Jordan in a lengthy trademark dispute in China, the Chinese Supreme People’s Court rules that Jordan owns the legal rights to his Chinese surname, “乔丹”, which is the Chinese equivalent of “Jordan”. This Chinese name is shown in pinyin, the official system which is used to transcribe Chinese characters into Latin script, as “Qiaodan”. While Jordan registered trademarks for his English name in China as far back as 1993, he never applied for any registered trademarks for “乔丹” nor for its pinyin representation “Qiaodan”.

Qiaodan Sports, a family-owned business based in the Fujian province, first applied to register the name Qiaodan when it applied to use the name with the logo of a baseball player at bat. It also filed several trademark applications for “乔丹” and “Qiaodan”, which were approved for registration in 1998. Qiaodan Sports has been using its 乔丹 and Qiaodan brands since 2000 and has made significant brand-building efforts over the years. Qiaodan Sports currently owns about 6,000 shops in China which trade under its name. Read the rest of this entry »

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German Federal High Court: Clubs can pass on fines to rioting fans

A ruling handed down by the German Federal High Court in November determined for the first time that penalties imposed on a football club by the DFB based on a fan’s misbehavior can be passed on to the injuring party. Therefore, rioting fans could now be facing large claims for compensations.

The fan’s liability is based on the spectator agreement between him and the club, which obliges him to be considerate of the club’s interest in an undisturbed course of the game. In case of a violation, the disturber is responsible for any damages that are supposed to be avoided by the infringed contractual obligation.

Football clubs are only able to organise a professional football game with the help of a superior association such as the DFB and are held responsible for the spectators’ behavior by it. The infliction of a penalty following the disturbance by a spectator is therefore a consequence that is supposed to be avoided by the agreement and thus not merely an accidental damage.

This ruling provides legal certainty for football clubs. While they have been reluctant in demanding compensations from fans in the past, this ruling might change their attitude regarding the matter. This might also have an impact on the spectators’ safety, since possible future offenders will have to take such recourses into account before causing any damages.

At the same time, it has to be considered that offenders are also punished by general courts regardless of DFB penalties, having to pay damages for pain and suffering. While the costs regarding the penalties are reasonable for football clubs, as they are based on the club’s financial capacity, they could mean financial ruin for private individuals. It is therefore questionable, if such judgements could even be executed.

Therefore, the DFB might have to consider making its system of penalties more transparent, as the amount of damages can’t currently be predicted by potential offenders.

However, the question of the extent, to which the offender will have to cover the costs, was not determined by the BGH, as this will have to be established by the Higher Regional court  in each individual case.

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Unlawful prohibition of sports betting in Germany

The Federal Administrative Court of Germany (BVerwG) ruled in a recent decision that if the state monopoly for sports betting persists an administrative prohibition of sports betting without a German sports betting concession would be unlawful.

This decision ties in with a recent decision of the European Court of Justice (ECJ). There the ECJ ruled that a criminal prosecution of a sports betting intermediate is contrary to EU law if the licensing process for private sports betting organizers has been held to not conform with EU law by national courts.

Dr. Michael Stulz-Herrnstadt and Christoph Engelmann commented on the decision of the BVerwG in the German magazine “GRUR-Prax” 2016 p. 542. The article can be viewed here (in German, subscription based).

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Polish Regulator publishes a new report on the gambling market in 2015

The Polish Regulator has published a new report on the implementation of the Polish Gambling Act in 2015. The report presents interesting statistical data and summarizes the most important court judgements.

The Polish version can be downloaded from the Regulator’s website: link.

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New gambling law for Germany

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

A few days after the prime minister conference decided on the amendment of the State Treaty on Gambling Germany has informed the EU commission about the proposed legislative changes.

The draft of the “Second State Treaty Amending the State Treaty on Gambling” provides for a few changes of the German gambling regulation that try to answer criticism by the European Court of Justice. Sports betting concessions will not be issued on a quantitative but on a qualitative basis in the future. This includes lifting the limit of 20 sports betting concessions and even issuing preliminary concessions for the 35 operators that have been found to meet the requirements for a concession and that are listed in the draft. In addition the German state of Hesse will hand over its competence to issue the sports betting concessions to another German state.

Unfortunately the German states decided to leave it at these minimal changes. They are looking into strengthening the enforcement against unlicensed gambling and into amending the regulation of online casinos. But the draft does not included changes in this regard and it does not address the criticism of the Council of Games of Chance (Gluecksspielkollegium) and the advertising guidelines (Werberichtlinie).

The standstill period of the EU notification procedure lasts until February 2017. The German states aim at a ratification of the new law until 31 December 2017. This means that the amended State Treaty on Gambling will not enter into force before 1 January 2018 and that the interim measure of getting orders of approval for sports betting will become more relevant until the concession procedure is realigned by the new State Treaty.

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Valencian Football Clubs have to pay back more than EUR 30 million of state aid. Professional sport clubs should be aware of the European State aid rules!

On November 04 the European Commission published the full text of its Decision on incompatible State aid to Valencian football clubs (SA.36387, an appeal has been filed). The Commission concluded that public support measures in the form of loan guarantees by the regional government of Valencia in favour of the football clubs FC Valencia, Hercules and Elche were granted in breach of EU State aid rules. As a result, Spain has to recover the illegal State. A  further decision regarding incompatible State aid granted by Spain to four other professional clubs (FC Barcelona, Real Madrid, Athletic Bilbao, Atlético Osasuna) has not been published yet.

The Commission concluded that the three Valencian clubs were in financial difficulty at the time of granting of the measures and the premiums charged for the guarantees cannot be considered as reflecting the risk of default for the guaranteed loans, which is why the measures provide for a selective advantage. The Commission grounds the distortion of competition and effect on trade between Member States on different reasons. Professional clubs compete for presence in European competitions as the UEFA Champions League and the UEFA Europa League. Furthermore, professional sports clubs are active on the markets for merchandising, broadcasting rights and sponsoring. On these markets, the teams generate revenue and compete with other clubs within and outside their home country. Therefore, public support measures granted to professional sports clubs can be liable to distort or threaten to distort competition and affect trade between Member States.

The Commission takes into account that measures granted to sport clubs might be found compatible under the State Aid rules under the notion of “development of economic activities” as the Union shall contribute to the promotion of sporting issues. But in this case the examined aid measures of the regional government of Valencia cannot be considered compatible with the internal market because the conditions and principles of the applicable guidelines are not met.

There might be good reasons for financial contributions by the State to sport clubs. However, The State, stakeholders and the clubs themselves shall thoroughly review legal boundaries especially regarding EU State aid law. Unlawful aid can be granted in many ways and often is not visible at first sight. As incompatible measures will be recovered from the beneficiary it is crucial to be aware of this topic whenever a club is dealing with authorities.

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Prime minister conference: amendment of the German State Treaty on Gambling

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

Last week the German prime ministers reached an agreement on the amendment of the German State Treaty on Gambling (GlueStV). They decided to cancel the limitation of concessions for sports betting. With the 2012 GlueStV the German states wanted to allow up to 20 licenses for private sports betting operators. However, none of the licenses has been issued. This led to criticism by the European Court of Justice (ECJ) and court decisions that even ordered the gambling authorities to issue sports betting licenses for operators. In the future the concessions shall not be limited to the amount of 20 but be assigned on the basis of minimum standards.

In addition to this the prime ministers ask the gambling authorities to consider the possibilities of improving the enforcement against illegal online gambling (especially unlicensed lotteries, sports betting and online casino games) possibly by founding a public-law institution with centralized responsibility. While evaluating the GlueStV the authorities shall also consider the simplification of identification and authentication of players and the substitution of the monthly stake-limit of 1.000 Euro with a loss-limit in the same amount. At last the prime ministers ask the gambling authorities to examine which regulatory measures could improve the regulation of online casinos considering the experience in other European countries. This decision hints in the direction that even licensing of online casinos might be possible in the future.

However, this is just the first decision of the prime ministers. After the criticism by the ECJ a new gambling regulation is needed in Germany and this decision of the prime ministers will hopefully lead to an amendment of the GlueStV in the near future. While the prime ministers of the 16 German states are discussing those amendments the authorities are working on a process to align the sports betting regulation with EU law. They reached an agreement to give out orders of approval for sports betting operators in the meantime. These orders allow (online) sports betting in Germany if certain requirements are met. However, the operator needs an order of approval in every single German state and not every state has an approval process in place.

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