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European Online Gambling Jurisdictions Challenged

By: Ryan Alders, Friday December 2nd 2011
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Subsequent to European Parliament resolution instructing the European Commission (EC) to act against defaulting national online gambling jurisdictions, there have been complaints filed against Greece and Germany.

In the case of Greece the complainants are the European Gaming and Betting Association (EGBA) and the Remote Gambling Association (RGA), who represent the majority of the largest European online gambling operators. It may be recalled that Greece enacted their online gambling law despite criticisms by the EC. The specific provisions complained against were listed in a joint statement from the EGBA and RGA, which are as follows. Licensed online gambling operators would be required to have a permanent base in Greece. They would have to engage in financial transactions through Greek banks. They must impose a higher age-limit restriction on online players than prevalent at land casinos. The complaint also states that the Greek Government has decided to grant OPAP, the state owned monopoly gambling operator, an extension of its existing license for an additional 10 years in an uncompetitive and non-transparent manner. OPAP pays no gambling tax on its offline activities, whereas online operators will be required to pay 30% tax on gross gaming revenue.

Sigrid Ligne, Secretary General of EGBA, said, "We trust the Commissioner will urgently investigate our compliant against Greece and take action accordingly against Greece as well as on several other pending complaints." Clive Hawkswood, Chief Executive of the RGA welcomed the opening of the Greek online gambling market, but expressed that action was warranted because the terms of regulation were contrary to the provision of the Treaties.

In the case of Germany the complaint has been filed by the online gambling operator Betfair. It challenges the draft German regulatory regime on grounds that it offers protection to German provincial monopolies. The complaint requests the EC to compel the German states to comply with European Court of Justice rulings and European Union free market principles. The complaint excludes the state of Schleswig Holstein, which has independently submitted a proposal that has been lauded by the online gambling industry.

The complaint could prevent the German states from securing EC approval by December 15. However, a spokesman from the Rhineland-Pfalz state said that not much importance is being attached to the complaint. The politicians were confident of obtaining the support of the EC in the dispute. The online gambling industry thinks otherwise. It may be recalled that European Court of Justice pointed out that the German states were vigorously marketing their monopolized online gambling services. In light of this the highest European court had turned down German claims that monopolized online gambling is necessary to control addictive gaming.

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