It appears as though the right to free access to online gambling services in Europe is destined to be decided by the courts, as increasing numbers of European states ignore the recent European Court of Justice directive which stated that a Member State cannot invoke the need to restrict its citizens’ access to betting services if at the same time it incites and encourages them to participate in state lotteries, games of chance or betting which benefits the state’s Finances.
The basic premise of a recent European Court of Justice statement regarding the subject is that individual Member States cannot protect state-sponsored monopolies at the expense of private or foreign-based enterprise. In an
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ideal situation, the European Commission would like to see open access to services or, failing that, no access at all. Protectionist economic policies appear to be contradictory to the very ideals upon which the European Union was established.
In April of this year, the European Commission sent official requests for information on national legislation restricting the supply of sports betting services to seven Member States (Denmark, Finland, Germany, Hungary, Italy, Sweden and the Netherlands). The Commission was responding to complaints that the Member States were in breach of Article 49 of the EC Treaty which guarantees the free movement of services. The EC decision to investigate these Member States was specifically related to sports betting, and a statement released by the EC at the time made it clear their decision to investigate did not have implications for the liberalization of the market for general gambling services.
However, the alleged breaches the EC are investigating in relation to sports betting seem to have a lot in common with recent steps France has undertaken to protect its own state-sponsored gambling monopoly. French police arrested two BWin executives in Monaco last week for “violation of French gambling laws” by “offering illegal games of chance, illegal lottery, advertising prohibited lotteries and taking illegal horse racing bets”.
Dozens of online gambling entities advertise in France, including market giants such as Casino-on-Net (888.com), who are the title sponsor of Toulouse FC. 888.com Chief Executive John Anderson handed in his notice not long after the BWin arrests, the timing of the announcement coincidental, to say the least. Hundreds of online gambling companies offer their services in France via the Internet, and it now seems likely executives of those companies risk arrest if they set foot in France.
To casual observers, the entire case appears cut and dry. The French actions, in attempting to protect their monopoly, are incompatible with European Community law. A spokesman for the EC Internal Market Commissioner, Charlie McCreevy, warned the commission was considering expanding their investigation following news of the French arrests.
Individual European states are testing the authority and will of the European Commission. The EC needs to stand up and exert its authority and, more importantly, it needs to exert that authority expediently. It is possible that the French actions are nothing more than an attempt to buy time to allow its monopoly to gain a firmer grasp in the market. If the EC takes too long to investigate before handing down a decision and enforcing that decision, the French monopoly can still win, even if the EC decision is not in their favor.
But with European government-sponsored monopolies generating as much as $30 billion in revenue annually, and rising every year, the stakes are high. Cut and dry it may seem, but the situation is almost certain to drag on for some time before reaching a conclusion.