Category Archive: Europe

Finland: Finnish Competition Authority to conduct an extensive assessment on the legitimacy of the Finnish state operated gambling monopoly in 2019

As for background, Finland has traditionally had one of the most stringent gambling regimes in the EU with a legal monopoly in place under the Lottery Act (2001/1047). The legal monopoly for the execution and marketing of physical and remote games resides with Veikkaus Oy Ab, a legal entity owned fully by the Finnish government. The monopoly covers games of chance, betting, toto games, slots machines and casinos. Gambling profits are distributed under the Lottery Act to certain “good social and public causes”. The supervision of the execution and marketing of games resides with the Finnish National Police Board.

The Finnish Competition and Consumer Authority (“KKV”) has launched an assessment procedure in January 2019 concerning the legitimacy of the state monopoly notwithstanding the fact that Finnish legislator has already provided for two general reforms to the Lottery Act in 2008 and 2012 in order to be more aligned with the consistency and proportionality requirements of EU gambling law. The reforms entailed e.g an implementation of marketing restrictions against Veikkaus and extensions to Finnish National Police Board’s supervision jurisdiction as well as new criminal sanctions.

The need for the previous reforms was caused by the EU commission’s infringement proceedings under article 258 of the Treaty on the Functioning of the European Union (“TFEU”) against Finland in 2007 concerning compliance issues under EU gambling law. The EU commission decided, however, in 2013 not to bring the infringement proceedings to the European Court of Justice. The commission argued that the reforms made as well as national mandatory derogations to the fundamental freedom to provide services under TFEU 56 article regarding consumer protection and prevention of problem gambling, money laundering and fraud were proportionate in light of the EU gambling law and while permitting derogations to the freedom to provide services.

Despite of these previous developments the KKV is now of the opinion that Veikkaus’s legal monopoly is still notably inconsistent with EU gambling law. According to the KKV, the marketing operations of Veikkaus have clearly accelerated and diversified in recent years and, combined with a loose placement policy of slots machines, there is a reasonable doubt whether the underlying goal is to maximize state profits (at the expense of the underpriviledged) rather than the prevention of gambling-related problems.

KKV underlines statistically that Finns lost a total of 1.8 billion € to Veikkaus in 2017 which corresponds to 1 % of the country’s GDP. KKV further stresses that even though 1.3 billion € were used for good societal causes, most of the funds are generated by the disadvantaged portion of the people with 5 % of total gamers generating 50 % of the total funds.

Another major problem underlined by the KKV is the decentralization and availability of slots machines e.g in grocery stores and gas stations,. i.e outside exclusive game rooms supervised by Veikkaus. Even though KKV welcomes the scheduled changes to the Lottery Act by 2022 concerning mandatory identification systems for slots machines, it also stresses that these amendments may not be enough in light of the consistent application of EU gambling law, unless slots machines are placed in supervised gaming rooms or alternatively individual gaming restrictions are linked to the identification process.

The assessment will also cover the supposed connection between problem gambling by the underpriviledged and marketing actions for instant loans.

It will be interesting to see whether the results of the assessment will be enough to put sufficient  political pressure on the legislator to finally dismantle the state monopoly at least as regards to remote gambling following the path of several other EU member states.

If you have any questions regarding the Finnish gambling regime, please contact Joonas Dammert (Joonas.dammert@dlapiper.com)/+358 40 572 8347 at DLA Piper Finland

SWEDEN: Limitations on bonuses and the SGA’s official position on the definition thereof

In Sweden, license holders may only offer or leave a bonus at the first opportunity a player plays at any of the licensee’s games (See Chapter 14, Section 9 of the Swedish Gambling Act (Sw. Spellag (2018:1138))).
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Join our DLA Piper gambling event before ICE Gaming 2019

DLA Piper Gambling event will take place on the 4th of February 2019 with experts from different jurisdictions and the Spanish gambling authority. Read the rest of this entry »

SWEDEN: New Swedish gambling legislation from 1 January 2019

Since the new gambling legislation came into effect in Sweden on 1 January 2019, a number of gambling license applications have been submitted to the Swedish Gambling Authority (Sw. Spelinspektionen).

On 27 December 2018, the Swedish Gambling Authority stated that it had received 88 applications for online gambling and betting. As of today, 60 applications have been granted.

To retain a granted license, each licensed gambling operator must obtain certification for their technical solution by an accredited body before 1 July 2019. If such certification is not obtained, the approved license will be revoked.

If you have any questions regarding the new Swedish Gambling Act, please contact Christopher Büller (christopher.buller@dlapiper.com) or Jessica Lorne (jessica.lorne@dlapiper.com).

Spain: Two months left to apply for online gambling licenses

 

Authors: Elisa Lorenzo / Paula Gonzalez de Castejón

 

As announced in our previous entry in this blog, on December 2017 a resolution launching the call for tender for obtaining new general licenses for exploiting gambling activities in Spain was published on the Spanish Official Gazette. This means that the Spanish online gambling market opened to new entrants.

Nonetheless, the Spanish market will close shortly, as the deadline for submitting the corresponding applications will be 17 December 2018, and it is still uncertain when a new call for tender – allowing interested operators to enter into the Spanish market – will be launched. During this application process, the Spanish gambling regulator (the Spanish General Directorate for Gambling Affairs, the “DGOJ”) has published the gambling data for the year 2017. The figures, available here show once again that the Spanish market is a highly attractive market, which still offers relevant opportunities to operators interested in entering into this market. Those figures reveal that the total amounts bet by participants in 2017 have exceeded €2,000 million, and that, in terms of Gross Gaming Revenue, the Spanish gambling sector has increased in €560 million during 2017, which implies a 30.9% of increase from 2016.

Not only the Spanish gambling market has increased in terms of participation and GGR, it has also evolved significantly from a regulatory perspective since 2011. The Spanish gambling regulations have been amended by the Spanish regulator in the last years to permit licensed operators offering new game variants. Within 2018 it is expected that new regulations will be approved. Those new regulations will cover both the introduction of new modalities for existing games as well as of brand new games.

Therefore, it seems to be a suitable moment to think about entering into the Spanish market.

We will keep you updated on new regulatory developments in the Spanish Gambling Sector.

SWEDEN: The Swedish administrative court of appeal (Sw. Kammarrätten) upholds decision to impose fines against Swedish evening papers for providing links to offshore gambling services.

In September 2013, the Swedish Gambling Authority (Sw. Lotteriinspektionen) issued an injunction under a penalty of a fine of SEK 45 000 per day against the evening papers Expressen och Aftonbladet for publishing links to offshore operated gambling services.

The papers appealed the decision arguing that the Swedish Gambling Authority’s decision was in violation of Swedish Fundamental Law on Freedom of Expression (Sw. yttrandefrihetsgrundlagen) and that the prohibition against promotion of offshore gambling services was incompatible with EU law.

The Swedish administrative court of appeal concluded that gambling advertisements are of commercial nature and, as such, not protected by the Swedish Fundamental Law on Freedom of Expression. Furthermore, the court did not assess that the prohibition against promotion of offshore gambling services is incompatible with EU law. As such, the Swedish administrative court rejected the appeal and upheld the Swedish Gambling Authority’s decision to issue the injunction.

While the new Swedish gambling act enters into force on 1 January 2019 and the new license applications are currently being processed by the Swedish Gambling Authority, we expect the papers to appeal the decision to the Swedish Supreme Administrative Court.

If you have any questions regarding the decision or the new Swedish gambling legislation, please contact Christopher Büller (christopher.buller@dlapiper.com) or Jessica Lorne (jessica.lorne@dlapiper.com) at DLA Piper Sweden.

Changes to UK gambling licence conditions and codes of practice

After having considered all the responses to the consultation on changes to the UK gambling licence conditions and codes of practice (hereinafter “LCCP“), the UK Gambling Commission has taken the decision to strengthen requirements on licensees in key areas.

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ITALY: Gambling advertising ban adopted, what to do now?

The law decree providing for the Italian gambling advertising ban was adopted, but a number of questions opened up as to its scope and legality. Read the rest of this entry »

Top 5 gaming predictions for 2018!

Gaming operators, suppliers and regulations have been rapidly changing in 2017, but what shall we expect for 2018 and how to get ready to it? Read the rest of this entry »

DLA Piper Gaming event before the ICE. Come and join us!

DLA Piper gambling event will take place the day before the beginning of the ICE gaming conference in London.  Read the rest of this entry »

Sweden: Legislative proposal sent to Council on Legislation for review

The Swedish Government proposed a new Swedish gambling act based on the proposal made by the government-appointed investigator in March 2017, and sent the proposal to the Council on Legislation (Sw. Lagrådet) for review.

In essence, the Council on Legislation will review whether or not the proposed gambling act is contrary to any existing legislative act before the proposal is handed over to the Swedish parliament for approval.

More information (in Swedish) can be found on http://www.regeringen.se/rattsdokument/lagradsremiss/2018/01/en-omreglerad-spelmarknad/.

If you have any questions, please contact Christopher Büller, christopher.buller@dlapiper.com, at DLA Piper in Sweden.

Belgian Court rules on offering different classes of games through a single web domain

On 9 November 2017, the Belgian Constitutional Court ruled, in response to three joined cases referred to it by the Council of State1, that the Belgian Gaming Act violates the Constitution insofar as it allows the accumulation of the exploitation of several supplementary licences of different classes through one and the same domain name and the URLs linked to it. Patrick Van Eecke and Kaat Scheerlinck of DLA Piper provide detailed analysis of the three joined cases, the Court’s decision, and the implications of the decision for the Belgian Gaming Commission’s licensing process and the Belgian gambling sector in general.

Read full article (subscription)

Update: German Sports Betting Regulation

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

The state parliament of Schleswig-Holstein announced that it will not approve the new State Treaty on Gambling. They want to push for an entire new law that includes licenses for online casinos as mentioned in their coalition agreement.

In addition the administration of North Rhine-Westphalia announced that it will not ratify the new law and that it stopped the implementation of the new responsibilities (the new law provides that North Rhine-Westphalia takes over the sports betting regulation from Hesse).

The consequence of this situation is that the new State Treaty will not enter into force on 1 January 2018 as planned. This is because the law provides that it will be invalid if it is not ratified by all 16 German states until 31 December 2017.

Until the German states find an agreement for a new law the current regulatory situation remains. Sports betting will be tolerated for EU-licensed operators as long as they comply with material regulatory requirements like advertising restrictions and AML obligations. This is now confirmed by several higher administrative courts like the ones of North Rhine-Westphalia, Saarland and Hesse.

Dr. Michael Stulz-Herrnstadt and Christoph Engelmann recently commented on the decision of the higher administrative court of Hesse in the German magazine “GRUR-Prax” 2017 p. 387; the article can be viewed here (in German, subscription based). Dr. Michael Stulz-Herrnstadt was also interviewed about the Schleswig-Holstein situation by the magazine “Online Gambling Lawyer“.

How the EU Privacy Regulation impacts Gaming Affiliates

The EU Privacy Regulation will oblige gaming affiliates to comply with stringent requirements in the processing of personal data of players.  Read the rest of this entry »

Update on the new AML Act in Germany

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

The new German Anti Money Laundering (AML) Act entered into force on 26 June 2017 after it has been published in the Federal Law Gazette.

The new AML Act brings three important changes for gambling companies:

  • Extension of the scope from online to offline gambling and from licensed to unlicensed gambling
  • Revised AML measures in detail
  • Extended catalogue of administrative offenses with higher administrative fines (up to 1 million Euro)

For more information on the new AML Act we published a client alert for gambling companies that are offering their services in Germany. In addition we wrote an article in the German newspaper FAZ covering the main impacts on gambling companies.

New licenses for online casinos in Germany?

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

After the elections in the German state Schleswig-Holstein the Christian Democrats, Free Democrats and Greens plan on a new gambling law in their coalition negotiations.

The Greens mention on their website that the coalition does not want to implement the new State Treaty on Gambling into their state law. Instead they plan on resigning from the State Treaty and on passing a new gambling law together with the states North Rhine-Westphalia, Rhineland-Palatinate and Hesse. The new gambling law is supposed to be based on the 2012 Schleswig-Holstein gambling law. Other than the State Treaty on Gambling it intends to offer (new) licenses not online for sports betting but also for online casinos including poker games.

State revenues will be used for prevention of gambling addiction, consumer protection, grassroots sport and common public interest. Brick-and-mortar casinos will be sold neutral in terms of effect on competition after the online licenses have been issued.

This is a very exciting development for operators that are looking into the German market. After the new State Treaty on Gambling has been criticized in recent court decisions it now looks like at least a few states might rethink their current gambling policies.

E-Sport will finally be recognised as a sport in Poland

Rafał Burda and Wojciech Biegański

On 14 March 2017, the Council of Ministers adopted a draft law amending the Act of 25 June 2010 on Sport (accessible here). The draft is currently subject to its first reading in parliament. The draft introduces an extension to the existing definition of sport, supplementing the solely physical activity expressed thus far in the sports law with “competition based on intellectual activity aimed at achieving a sports result”. This extension is aimed at achieving two main goals: (i) to officially recognise sporting disciplines like checkers, chess or sports bridge as sports competitions; and (ii) to bring e-sport competitions under the jurisdiction of sports law, due to the fact that such intellectual activity is widely regarded as having similar social effects to physical activity. Given the fact that e-sport is expected to expand its global fan-base to around 345 million by 2019, this change in the law seems absolutely necessary. As of 1 April 2017, accepting bets on virtual events (including e-sport) is expressly allowed under the Polish Gambling Act.

New AML Act for Germany – impact on gambling operators

By Dr. Michael Stulz-Herrnstadt and Christoph Engelmann

The financial committee of the Federal Parliament agreed on amendments to the new German Anti Money Laundering (AML) Act (Geldwäschegesetz, GwG) yesterday. The new law will bring important changes for gambling operators.

While the scope of the new AML Act will be extended from online gambling to also offline gambling operators, there are some gambling products (e.g. social lotteries, slot machines) that might benefit from new exceptions because of their low money laundering risk. Other gambling operators (e.g. sports betting shops) might be faced with new challenges like restrictions in payment methods and new administrative offenses with administrative fines of up to 1 million Euro.

To implement the 4th AML directive the new law has to enter into force by 26 June 2017. Prior to this the Federal Parliament and the Federal Assembly are expected to agree to the proposed changes. We will keep you updated on the developments.

Update (19 May 2017): The Federal Parliament adopted the changes on 18 May 2017.

Global: Prize Promotions around the world

DLA Piper is pleased to announce the launch of Prize Promotions Around the World, an updated version of our previous prize promotions handbook.

Prize Promotions Around the World is an online tool designed to assist our clients across the globe with the management of the early development stages of a prize promotion (such as a sweepstake or skill-based contest), and to bring to their attention potentially problematic issues.

Key features include:

  • Additional jurisdictions, now with over 35 countries
  • Expansion of topics, including rules on judging and sanctions
  • Interactive map, highlighting the range of risk profiles in different jurisdictions

Access Prize Promotions Around the World here

Sweden: Proposal for the introduction of a licensing system

Today, the investigator appointed by the Swedish Government, Mr. Håkan Hallstedt, handed over his proposal (1,340 pages) for the introduction of a Swedish licensing system to the Swedish Minister for Public Administration, Mr. Ardalan Shekarabi.

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