Europe: Will the Fox Report urge the European Commission to take legal action against Member States

During the QED session on Tuesday 19 March last, 4 speakers gave their opinion on some online gambling topics and entered into debate afterwards. An interesting topic was the initiating by the European Commission of infringement cases against Member States due to non-compliance of national gaming legislations with European law principles.

European Parliament Member Ashley Fox, author of a draft report following the European Commission’s recent Communication on online gambling (the so-called Fox Report), pointed out once more that the sector of online gambling is one where many controversy exists and which also strongly divides Member States. He stated during the conference that as a way forward, there should be a well-regulated online gambling industry excluding over-regulation and anti-competitiveness so as to avoid that European gamblers would seek (possibly unregulated) alternatives. The three-pages long Fox Report amongst others urges the Commission to take action against Member States infringing Union law, which was repeated by Mr. Fox during the conference.

Ms. Charmaine Hogan, policy officer at DG Internal Market and Services, online and postal services unit, stated that since the Communication “Towards a comprehensive European framework for online gambling” has been issued by the European Commission, several initiatives have been taken and that these will be further developed.

Next to the political side, concerns from the gaming industry were ventilated by Mr. Maarten Haijer, director of regulatory affairs at the EGBA. According to the speaker, gambling companies are active in an extremely innovative, hence competitive, industry, whilst being subject to very specific regulations that differ from country to country. As we heard the industry state before, according to the speaker there would be major advantages in creating harmonization and standardization, at least on a European level. Mr. Haijer therefore urged the Commission to take appropriate action in this respect, with priorities on harmonization, cooperation within and compliance with the EU legal framework, e-verification standards and application of AML regulations to the gaming sector.

Mr. Michael Bay JØrsel, an expert on addiction problems including gambling addiction, finally advocated a code of conduct for responsible behavior, pointing out that much efforts are spent on research whereas the emphasis should lie on prevention. Educational websites and self-exclusion tools were mentioned by Mr. JØrsel as valid initiatives for persons dealing with compulsive gambling issues.

During the debate between the four speakers, Mr. Fox clearly questioned the Commission’s willingness to act against Member States. On the question why the Commission has not launched cases against Member States allegedly infringing Union law, Ms. Hogan stated that it is not self-evident to gather all necessary evidence to bring a case before court. Mr. Fox however, stated that the Commission’s reluctance to bring such cases before court are a result of political pressure hindering the Commission to fulfill its role as guardian of Union law. He actively urged, as does the Fox Report, the Commission to take appropriate action.

It seems therefore that the European Parliament might pressure the European Commission to initiate court cases against several Member States, some of which have been already notified by the Commission years ago but where procedures have been dormant up until now. Whether political support for the Fox Report will be sufficient, remains to be seen. Amendments to the Fox Report can be made up until the beginning of April, and in May a vote will first take place in the Committee on the Internal Market and Consumer Protection (IMCO) of the European Parliament.

Should you have any further questions regarding to the above, please contact Patrick Van Eecke (Patrick.vaneecke@dlapiper.com) or Antoon Dierick (Antoon.dierick@dlapiper.com).