Wednesday, April 10, 2019

Four recent pieces of news from around Europe are all related, although they are about events in four different countries. Firstly, the Mayor of Riga, Latvia, not content with the closing of gaming halls (arcades with casino style slot machines) in the Old Town of Riga, has now demanded that most gaming venues in Riga be closed, excepting those in 4-star and 5-star hotels.

In Latvia, casino and gambling hall operators require two permissions in order to open a venue. One is a license from the State regulator to say that you are an approved operator; the other is a premises license issued by the municipal authority, the latter valid for five years. The Mayor is asking the City officials not to renew premises licenses and so if the Mayor gets his way, over a five year period all targeted gaming venues will have to close.

At the end of January 2019, the online poker regulatory authorities of France, Portugal, and Spain released a public statement on the implementation of the agreement concerning online poker liquidity sharing that they signed on 6th July 2017. The fourth signatory to that agreement was the gambling authority of Italy.

The purpose of the agreement between the four authorities was specifically to share the liquidity volume in online poker in order to render it (again) attractive and maintain, at the same time, high standards of protection and public enforcement.

While Italy has not yet given execution of this agreement, France, Portugal, and Spain expressed their general satisfaction on the evolution of this new online shared ecosystem.

Melchers Law

On 21 March 2019, the Prime Ministers of the sixteen German states met for a conference intended to mark an important step forward in the debate on Germany’s future gambling regulation. They agreed on a Treaty amending the current Interstate Treaty, Germany’s core legal framework governing gambling. The new Treaty, which has become known as the Third Amendment Treaty or Interim Interstate Treaty, is supposed to enter into force on 1 January 2020 and to be valid for an interim period, until 30 June 2021. But the term of the entire Treaty can be extended until 30 June 2024.

The new Treaty provides the basis for a new, open sports betting licensing process intended to allow licensing as of 1 January 2020. But it also maintains the total ban on other online gambling as well as some questionable restrictions affecting the range of bet types which may be offered, and the way operators are supposed to impose limits on players. The Third Amendment Treaty therefore certainly has not resulted in the broad reform many had hoped for, and has been accordingly criticised. But what exactly does it entail and what will it actually change? This article will take a closer look at the new Treaty to make sense of what lies ahead for operators targeting Germany.

The Euro News Revue
by Hannah Gannagé-Stewart and Andrew Tottenham
Not surprisingly, the deadline for the submission of tenders for the new casino license in Hellinikon has been extended until the end of May. The original Request for Proposal (RFP) had given a 60-day window for bidders to complete and submit their responses. Given the size and complexity of the project, any company not already “off the blocks” by the time the RFP was issued had little chance of being able to comply with the deadline. Even with the extra month it is going to be extremely difficult to complete all of the required documentation by the deadline. (AT)
For Germany, a country that is known for precision in everything, there is one area where it consistently falls down: gambling law and taxation. The mess created by its Interstate Treaty on Gambling still has not yet been cleared up after almost seven years.

An administrative court in Nord Rhein Westphalia has ruled that local taxes on betting establishments are unconstitutional, possibly opening the gates to challenges in other cities. The ruling relates to a 3% tax on wagers that the city of Bielefeld had imposed. Lawyers and constitutional experts disagree if this relates purely to Bielefeld or has wider implications. (AT)
What appears to be an administrative hiccup has put a spanner in the works of OPAP’s roll out of VLTs in Greece. Originally OPAP was given permission to operate 35,000 VLTs throughout the country, which met with massive opposition from the casino sector. In what appeared like a quid pro quo, OPAP agreed to reduce their allocation to 20,000 machines and the casinos dropped their opposition if gaming taxes were reduced and the casino in Mont Parnes could move to a new location. The owners of the casino in Loutraki continued to oppose the roll out; now a decision in a court action they brought has said that the original permission to operate the VLTs should have been made by a Presidential Decree. It wasn’t. The entire VLT program is now in limbo. (AT)
Last week the Lithuania Gaming Control Authority levied an €495,500 fine against Olympic Casino Group Baltija, a local subsidiary of the Estonia-headquartered Olympic Entertainment Group. The fine relates to a breach of Lithuania’s anti-money laundering laws, after three customers were able to exchange large sums of money without having their identities verified. iGaming Business reports that the exchanges took place over one 14-hour period in 2018, when the unverified players exchanged €42,200 in cash for chips at the Olympic Casino Panevezys. The Lithuanian regulator has the authority to dish out fines of between €2,000 and €1.1m to operators that fail to verify the identity of any customers who exchange €1,000 or more. (HGS)
Few European operators will have been surprised to learn that Sweden’s state-owned Svenska Spel continues to dominate the country’s newly regulated market. Figures released by the Swedish regulator Spelinspektionen revealed that 85% of market turnover has been generated by 10 operators during January and February, leading iGaming Business to value the market at around SEK3.3bn (€316m) turnover for the first two months of the new regime. The country’s former horse racing monopoly AB Trav och Galopp came in second, having transitioned to a private company, while Stockholm-listed Kindred Group, home of legacy igaming brand Unibet, was listed as the leading private operator in the market. (HGS)
The UK’s Advertising Standards Agency (ASA) has been using ‘child avatars’ to identify operators breaching their rules on advertising to children. According to Affiliate Insider, five operators - NetEnt, Evoke Gaming, Multilotto, Platinum Gaming, and Skill On Net - were found to have contravened the rules prohibiting targeting gambling ads at minors. The ASA investigation took place over a two-week period in 2018 and identified 43 operators displaying ads on websites aimed at under-18s. NetEnt came out particularly badly, with its Vikings slot game responsible for 81% of the 151 ad impressions viewed by the avatars during the investigation. (HGS)
The chairman of Dutch gambling trade body Van Kansspelen Branche-organisatie has called for a reversal of the temporary gambling tax increase introduced last summer. Frits Huffnage said the tax is unnecessary in light of the country reporting an €11bn budget surplus for 2018. The higher tax rate was set at 30.1% of gross gaming revenue, 1 percentage point higher than the 29.1% operators will be taxed under the new Remote Gambling Act. The temporary increase is set to last until January 1, 2021, but Huffnage would like it reversed no later than January 1, 2020 – six months before the country is expected to award the first licences under the new Act. (HGS)
The UK’s press has been as vociferous as ever this month as the betting limit on fixed-odds betting terminals (FOBT) was reduced from £100 to £2 on April 1. The Guardian was one of many national papers to highlight bookmakers accused of trying to bypass the new rules by launching high-stakes roulette-style games on the day that the rules changed. Big-brand bookmakers Betfred and Paddy Power both launched such games within 48 hours of the Gambling Commission warning against attempts to bypass the new rules. The Guardian reports that the Gambling Commission is investigating the new products, to determine whether they contravene FOBT rules. (HGS)
This report is edited by Andrew Tottenham and Justin Martin
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