European regulation update
In conjunction with Chris Elliott and Beth French of Wiggin LLP, iGaming Business provides a regulatory snapshot of igaming markets across the EU. This includes regulated products and legalised operator types within each country, and any impending market updates.
AUSTRIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: Licences for sports betting and horse race betting are available for private operators on a regional basis within Austria whereas poker, casino, bingo and lottery are controlled by the monopoly, Austria Lotteries.
Status: An appeal challenging Austrian tax legislation is seen as a test case by other offshore operators targeting Austrian business. Recent court decisions reached conflicting decisions on the compatibility of Austria's current gambling legislative framework with EU law, which remains unclear. The Austrian government put forward a proposal to block unlicensed offshore operators targeting the country, although next steps are unclear.
BELGIUM
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: All products are available to private operators save for lotteries, which are reserved exclusively for the monopoly provider. However, online operators need to partner up with local casinos in order to satisfy the land-based establishment requirement; or alternatively, apply for one of the 34 retail licences (F1 licences) which can be extended to cover online (F1+ licence).
Status: The regulator recently introduced rules to prevent live casino products being offered to players unless the dealers are physically in Belgium. The potential for EC infringement proceedings remains. The Belgian government has elected to apply VAT of 21% on online gambling transactions with effect from 1 July 2016.
BULGARIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery (excluding raffles and instant lottery games).
Operator Type: All products are available to private operators save for lotteries, which are reserved exclusively for the monopoly provider.
Status: Bulgaria’s Gambling Act became law on 1 July 2012 but licences were not available until mid-2013 as further implementing legislation needed to be in force. Any operator from an EU/EEA jurisdiction or the Swiss Confederation can apply for a licence. The Bulgarian regulator has subsequently issued licences, including to a number of international operators, and recently removed the restriction on Gibraltar-based applicants. The change from a turnover to a GGR tax-based system has prompted a number of operators to apply for a local licence.
CROATIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: All products are available to private operators save for lotteries, which are reserved exclusively for the monopoly provider. Private operators can only be licensed to offer online gambling if they obtain a land-based casino or betting licence.
Status: Following Croatia’s accession to the EU in July 2013, it was understood it would submit new legislation which was compatible with European law. However, on 5 March 2014 the Croatian government notified a draft bill which seeks to embolden the position of the monopoly and local operators. The draft bill still stipulates that only land-based casinos and betting operators can apply for a licence. ISP blocking is also proposed. The receipt of a Detailed Opinion from the EC stalled the legislative process and there have been no developments since.
CYPRUS
Regulated Gambling Products: Sports betting, horse race betting and lottery.
Operator Type: OPAP have a monopoly over lottery operations; sports betting licences will be available to private operators.
Status: Cyprus regulated online betting in July 2012 (although licences are not yet available). The government published a blacklist and warned local ISP providers that they would face fines for failures to block sites offering unlicensed gambling products. Draft amendments to Cyprus' gambling legislation are intended to address compatibility issues raised by the European Commission's letter of formal notice, but the official text of the proposed amendments has not yet been published. On 2 August this year, the regulator announced its intention to implement the online betting licensing regime, stating that applications for such licences will be accepted from 3 October, with applications accepted for a one-month period only.
CZECH REPUBLIC
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery (from 1 January 2017).
Operator Type: EU and EEA-based operators are able to apply for licences which, if granted, will become valid from 1 January 2017. Lottery will remain reserved for the monopoly.
Status: A bill to amend Czech Republic's gambling legislation was signed into law in June 2016. The bill, effective on 1 January 2017, allows EU/EEA companies to apply for online licences. The licensing process was launched on 7 September.
DENMARK
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: Sports betting, poker and casino licences are available to private operators. Bingo, lottery and horse race betting (fixed odds only) is controlled by the state monopoly.
Status: The Danish online gambling regime went live on 1 January 2012. ISP-blocking measures are active in the jurisdiction and the Danish Gaming Authority has been granted an injunction in order to block operators and suppliers that have been targeting Danish customers without the requisite licence. In December, the government adopted two amendment bills which create specific licences for fantasy sports operators, as well as bring about certain new match-fixing and AML measures.
ESTONIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: Licences for all gambling products are available for private operators save that the monopoly has exclusive rights to lottery.
Status: As of June 2016, only 16 operators are licensed in the jurisdiction, 12 of which operate online gambling. A “blacklist” of around 1,100 operators is constantly maintained and updated by local authorities and ISP blocking is in force. A new law which introduces new player protection measures and relaxes certain online sports betting advertising restrictions came into force in June 2015. Further amendments introduced in January 2016 extend the application of self-exclusion lists to lottery and sports-betting players.
FINLAND
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: All gambling products are under the exclusive control of the three monopoly providers, Raha-automaatiyhdistys (“RAY”), Fintoto Oy and Veikkaus Oy. The monopolies are soon-to-be merged into one state entity (expected to take effect from 1 January 2017).
Status: An ECJ ruling confirmed that Finland’s three monopoly providers are legally permitted which has subsequently been written into law. In November 2013, the EC also withdrew infringement proceedings. Active enforcement measures are in place (restrictive marketing for offshore operators and ISP blocking).
FRANCE
Regulated Gambling Products: Sports betting, horse race betting, poker and lottery.
Operator Type: Private operators can obtain online licences for sports betting, horse race betting and poker. The monopoly has exclusive rights to lottery.
Status: France is a regulated market that has been sanctioned by the EC. Parliament announced that it would conduct a full review of French gambling legislation in 2016. On 20 July 2016, the French Parliament are adopted the Digital Republic Bill which will allow international poker liquidity. In addition, Parliament is currently considering a bill concerning the legal framework for skill games and e-sports, which could be liberalised.
GERMANY
Regulated Gambling Products: Schleswig-Holstein, a small Northern German state, regulates sports betting, horse race betting, poker, casino and bingo. The other 15 states of Germany currently only permit sports betting and horse race betting.
Operator Type: Private operators can no longer obtain licences in Schleswig-Holstein, and those in existence will expire on 30 June 2019. In the other 15 states, horse race betting licences are available at a regional level but the position surrounding the 20 available sports betting licences is still uncertain.
Status: The licensing regime in Germany is in a state of flux. The tender for 20 Federal sports betting licences was abortive, following a number of appeals by operators who were not granted a licence. The CJEU ruled, on 4 February 2016, that Germany’s sports betting regulation is incompatible with EU law and that enforcement actions will be unlawful where a de facto monopoly exists and none of the 20 licences could, in practice, be acquired. The decision has led to calls for comprehensive legal reform of Germany's gambling legislation, which is currently being debated. The state of Hesse has adopted a formal policy of tolerance (similar to that of a quasi-licensing regime) requiring sports-betting and betting-exchange operators to apply for a 'tolerance' by 15 November 2016.
GREAT BRITAIN
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: All licences are available to private operators save for lottery, which is reserved exclusively for the monopoly provider, Camelot.
Status: Any operator that transacts with, or advertises to, British residents requires a licence from the Gambling Commission. From 31 March 2015, licensed operators are required to source gambling software from Commission licensed businesses. A corresponding tax rate of 15% of gross profits was introduced on 1 December 2014. This is subject to an ongoing judicial review by a Gibraltar trade association and its questions regarding its compatibility with European law have been referred to the CJEU. The Treasury is confident that it can defend its position.
GREECE
Regulated Gambling Products: Sports betting, horse race betting and lottery.
Operator Type: All products are exclusively reserved for the monopoly providers although 24 transitional licences for private operators remain active, with all products permitted.
Status: The licensing regime in Greece (like Germany) is also in a state of flux. The Greek government granted 24 transitional licences to operators in December 2012 enabling them to keep transacting with Greek residents. However, in March 2013, the government notified draft legislation to the EC which effectively rescinds the licences; a position criticised by the EC. Greece’s new government is currently considering plans to more tightly regulate online gambling, to end the ongoing transition position. The fate of the 24 licences is still unclear. A tax increase tax has been established on gross gaming revenues, increasing the rate from 30% to 35% as of May 2016.
HUNGARY
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: Only the state monopolies (Szerencsejáték Zrt. and Magyar Lóversenyfogadást-SzervezőKft) and local concession companies can apply for a licence.
Status: Amendments to Hungarian gambling law came into force on 1 October 2015 which allow only two land-based casinos to hold remote casino concessions. The regulator has since issued fines against unlicensed operators who continue to target the market. ISP blocking of unlicensed sites has occurred since June 2014. The potential for EC infringement proceedings remains.
IRELAND
Regulated Gambling Products: Online gaming is not specifically accounted for in Ireland’s outdated legislation and as such is currently unregulated. Online betting regulated since August 2015.
Status: Ireland is in the process of updating its legislation which will create a comprehensive online gambling regime and payment restrictions. The Betting (Amendment) Act 2015 now requires remote bookmakers to hold a licence, and pay a 1% turnover-based betting duty.
ITALY
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo and lottery.
Operator Type: All products available to private operators save for lottery which is reserved for the monopoly provider. However, it is currently not possible to obtain a licence in Italy.
Status: Fully regulated market. Previous restrictions on the type of events/markets on which bookmakers can offer odds are possibly to be abolished. A recently passed Stability Law introduces various measures affecting the remote gambling industry, including tax changes and plans for tighter advertising rules. The law will provide for the award of 120 new online gaming licences (lasting for six years), the tender for which is expected to begin in September 2016. The government also moved to a GGR-based tax for online betting operators (22%), with effect from 1 January.
LUXEMBOURG
Regulated Gambling Products: Lottery
Operator Type: Monopoly.
Status: The general prohibition on gambling appears sufficiently wide to cover all forms of online gambling.
MALTA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo, lottery.
Operator Type: Private operators can apply for a local licence but not in relation to lottery products.
Status: On 3 June, Maltese regulator the Malta Gaming Authority introduced a number of policy changes. These include changes regarding hosting servers abroad, audit requirements and the cloud environment. Malta plans to introduce gambling legislation during 2016 to modernise online gambling rules. On 19 August 2016, the Government of Malta notified the EU Commission of its draft Skill Games Regulations 2016, which would establish a regulatory framework for skill games for prizes.
NETHERLANDS
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo, lottery.
Operator Type: Monopoly for all products.
Status: After two years of parliamentary debate, the Dutch Lower House approved the Online Gambling Bill which will introduce an online gambling licensing regime in the Netherland, expected in early 2017. The legislation will impose a 29% GGR tax on both online and land-based operators. In the interim, the regulator has started to implement enforcement measures. In November 2015, the regulator levied its highest ever fine on two gambling operators for continuing to target Dutch players. In May 2016, a Dutch court upheld fines issued by the regulator in the first such case to go to trial.
NORWAY
Regulated Gambling Products: Sports betting, horse race betting and lottery.
Operator Type: Online gambling is reserved for its two monopoly providers: Norsk Tipping and Norsk Rikstoto.
Status: The monopoly has extended its offering to include live betting, e-bingo and casino games in an attempt to redirect traffic from unlicensed sites. However, the new government is understood to be considering a limited licensing regime for foreign operators. The government is preparing a white paper on how best to regulate the gambling sector, and aims to present this to Parliament in November 2016.
POLAND
Regulated Gambling Products: Sports betting and horse race betting.
Operator Type: From 3 September 2015, licences are available for companies with a representative in Poland as opposed to a local establishment.
Status: Legislation enacted 1 January 2012 only permits betting and only four licences were granted to local companies (Fortuna, Milenium, STS and Totolotek).
The Government notified proposed amendments to the Gambling Act to the EC on 29 July 2016. The amendments, once implemented, will preserve the right of a state-run monopoly to operate online casino and poker games, as well as introduce ISP and payment blocking measures.
PORTUGAL
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo, lottery.
Operator Type: Any EU/EEA operator can apply to be granted a licence for online gambling. Lottery games and land-based fixed odds sports betting remain reserved for a monopoly.
Status: Portugal’s online gambling legislation was passed by Parliament in late February 2015 and came into force on 29 June 2015. While operators can now apply for licences, their Portuguese revenue streams will be subject to comparatively high tax rates, particularly sports betting, the subject of a 8-16% tax on turnover. The RGA recently filed a state aid case with the EC challenging the Portuguese betting tax as breaking EU trade rules. There is no deadline for the licensing window or limit on the number of licences that may be issued. Delayed technical standards were introduced on 23 December, paving the way for operators to certify their online systems to obtain a licence. The regulator is known to have granted three licences.
ROMANIA
Regulated Gambling Products: Sports betting, horse race betting, casino, bingo and lottery.
Operator Type: Any operator from an EU/EEA jurisdiction or the Swiss Confederation can apply for a licence. Lottery games remain reserved for the monopoly.
Status: The Romanian government passed legislation at the end of 2014 that allows entities within the EU to apply for a licence, imposes a reform on licence fees and eliminates many (but not all) of the tax burdens placed on player revenues. The Gambling Law (as amended) introduced a legal framework for a fully regulated online gambling market, and requires licences to be held by online gambling operators, as well as software providers, payment processors, affiliates and testing labs. After some delay, the secondary legislation which fully implemented the new licensing regime came into force on 26 February 2016. The regulator has stepped up enforcement attempts by publishing a blacklist of unlicensed gambling products, whilst a number of large European operators have challenged the regulator’s decision on the award of licences.
SLOVAKIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo, lottery.
Operator Type: All products are operated by the monopoly save that land-based sports betting operators can offer services online due to a legal loophole.
Status: The government notified draft gambling law amendments to the European Commission which would introduce ISP and payment blocking of illegal online gambling offerings in the Slovak territory. Whether these amendments will also introduce a formal licensing system is not clear at present.
SLOVENIA
Regulated Gambling Products: Sports betting, horse race betting, poker, casino, bingo, lottery.
Operator Type: Online gambling must be operated by land-based casinos or lotteries and, as a result, only the monopoly holds online licences in Slovenia.
Status: The Finance Ministry notified secondary regulations for the operation of online gambling services to the European Commission on 17 August 2016. The proposals would remove the cap on the number of online gambling licences and the requirement for a local establishment, although sports betting would remain as a monopoly. The standstill period ends on 18 November, 2016.
SPAIN
Regulated Gambling Products: Sports betting, horse race betting, casino, poker, bingo and lottery.
Operator Type: Private operators can apply for licences for all gambling products save for lottery.
Status: The first online licences were issued on 1 June 2012. Under the law, online operators must hold a general licence and a specific licence for each activity from the National Gambling Commission. In June 2015, 10 new licences were awarded to new operators, the first new licensees since the market opened in 2012. 25 online slot permits were also issued to new and existing licensees. This followed on from the approval of the regulation of slots and approval of the regulation of betting exchanges.
SWEDEN
Regulated Gambling Products: Sports betting, horse race betting, poker, bingo and lottery.
Operator Type: Only public benefit organisations, the horseracing industry and the state lottery may obtain a licence. No local licences for private operators.
Status: The Swedish government is under pressure to update its regulations. The commencement of infringement proceedings by the EC appeared to mobilise the Government but recent statements have suggested that updated regulation to permit private operators to obtain a licence may not emerge in the short-term. The Government has confirmed it is proceeding with an investigation into reforming the law with a view to potentially opening the market to private operators in due course. The review will conclude at the end of March 2017.