In what is a startling change from previous decisions that have been handed down by their judiciary, the European Union’s Court of Justice ruled against online gaming operator bwin in a suit the organization had brought before the Court.
The original challenge from bwin focused on the nation of Portugal and its monopolization of the online gaming industry. The Portuguese soccer league had signed a sponsorship deal with bwin that allowed the online gaming giant to advertise to fans who visited the website of the league. The national Portuguese state betting monopoly, operated by the national charity Santa Casa, objected to the deal and ordered the league to remove the bwin affiliation, which drew the charges by bwin and the soccer league in the Court of Justice.
Instead of finding on the side of the online gaming company and the soccer league – as has been the case in many proceedings in the past – the Court of Justice found that the government of Portugal and the betting company Santa Casa had the right to shut down the deal between bwin and the Portuguese soccer league. Details of the decision, issued on Tuesday, demonstrated that there is a fine line when it comes to these decisions across the borders of the European Union.
In an announcement of the decision, the Court of Justice stated, “Member States are free to set the objectives of their policy on betting and gambling and, where appropriate, to define in detail the level of protection sought. The fight against crime may constitute an overriding reason in the public interest that is capable of justifying restrictions in respect of operators authorized to offer services in the games-of-chance sector.”
What perhaps is the key reasoning for the decision from the Court of Justice is that the business arrangement between bwin and the Portuguese soccer league could lead to improprieties on the pitch. “The possibility cannot be ruled out that an operator which sponsors some of the sporting competitions on which it accepts bets and some of the teams taking part in those competitions may be in a position to influence their outcome directly or indirectly, and thus increase its profits.”
The European Union has had a tremendously difficult time when it comes to decisions regarding online gaming across its Member State borders. While some have taken the approach of Portugal and started government sponsored gaming sites, which prevent outside companies from entering into their monopolized gaming arenas, others have taken a different tactic and embraced the regulation and taxation of the industry, such as England. In many cases in the past, the European Union’s myriad of Courts and committees has made decisions that sided with the gaming industry and forced nations to open up their borders to outside companies. In the past year, however, there has been a change to some of the policies that the EU tries to enforce.
In March of this year, the European Union admitted that they were unable to come to a comprehensive agreement regarding the streamlining of access to internet gaming across the continent. This has opened the doors to Member States of the EU to test how far a government run gaming option can push the EU’s free trade policies, with Italy’s online gaming market – which allows outside companies to participate if they adhere to severe conditions – as the primary example. While we may think the United States has all the problems with online gaming, the European Union is also demonstrating that they have few answers to the questions either.
The EC hasn’t said ‘gambling monopolies are ok’, what they have said is that it’s fine for countries to implement them to stop fraud, money laundering, problem gambling etc. However, as theres no research been carried out which suggests that a monopoly is better for anyone other than state coffers, Commercial operators would be well within their rights to challenge this, and they would likely win.