Wednesday, March 6, 2019

According to the number of times I get asked, there is clearly a misunderstanding about the role of skill in gambling. There is a misconception that if a game during which people can win or lose money has an element of skill in determining the outcome, then it must be legal. This was the argument that the US operators of Daily Fantasy Sports used when they promoted their product all over the US. We know how far that got them. Essentially, this is the Uber approach to the law: push the boundaries as far as you can while you gain market share, and then, if you are called out by the authorities for doing something illegal, you declare “mea culpa” and hope for a slap on the wrist.

In most jurisdictions around the world, if an activity is gambling according to their law, it is regulated and restricted. But what elements does a game need to have in order for it to be gambling? As I have said in the past in this column, gambling sits on a three-legged stool. As long as all three legs are present, then an activity is gambling, but if any leg is missing, then it is not. Those legs: a person must (1) risk something of value, (2) to obtain a prize of value (3) on an occurrence for which the outcome is based on chance.

It will have come as no surprise to the industry last week when the UK’s deputy opposition leader Tom Watson unveiled the Labour party’s plans to reform gambling legislation. At least it shouldn’t have done.

Over the past year calls for fundamental changes to the way the industry operates and is regulated have been building across various channels of public discourse in the UK.

In May last year, a £2 maximum stake was imposed on fixed odds betting terminals (FOBTs). Then, in the summer, the World Cup ignited heated debate over ‘excessive’ TV advertising in pre-watershed (9 pm) slots. All the while, the Gambling Commission was preparing to dish out hefty fines to a succession of operators that had failed in their duty to protect problem gamblers.

The Euro News Revue
by Hannah Gannagé-Stewart and Andrew Tottenham
The uncertainty around Brexit continues to confound business leaders. With only 23 days to go until March 29th, GVC announced it has made contingency plans to migrate some of its infrastructure to Malta and Ireland to ensure compliance with laws in other EU countries where it operates. If the UK leaves without a deal, any company that has been dependent on being resident in the UK to serve customers in other EU countries will likely have to find a new home. Most EU countries require a company to be registered in and the servers to be located in the EU. A “no deal” Brexit would mean the UK is out of the EU. (AT)
FTSE 250-listed online gaming company 888 Holdings PLC bolstered its sports betting arm this week, announcing on Monday a £15m deal to acquire Irish bookmaker BetBright from its owners Dedsert Ltd. The deal gives 888 its first proprietary platform as it prepares to ramp up activity in the US. The deal comes as a blow to Stockholm-listed technology supplier Kambi, which has, to date, provided 888Sport’s platform and helped the company break into the New Jersey market last year. The deal is 888’s third acquisition in almost as many months, having acquired Jackpot Joy’s Mandalay operating business for £18m last month, plus the remaining 53% stake in the All America Poker Network from joint-venture partner Avenue OLG Entertainment. (HGS)
Dutch gambling regulator Kansspelautoriteit (KSA) has increased the fines for unlicensed operators who tout for business online in the country. Those breaching the regulations will face fines starting at €200,000, up from €150,000. According to iGaming Business, the KSA has also levied fines of at least €75,000 for three specific types of breach: offering live betting, calculating costs for temporary inactive players, and making misleading statements about permits and supervision. The increased financial penalties come as the country prepares to issue licenses for the first time to allow online operations in the country. At the end of last month, the Dutch Senate passed its Remote Gambling Act, four years after the legislation was first introduced in the House of Representatives. (HGS)
Athens-listed Intralot SPA is reported to have lost its tender to continue its provision of services to the Turkish betting monopoly IDDAA this week, despite having run IDDAA’s betting operations since 2004. The tender decision was revealed in a market filing by Intralot’s JV partner for the contract, Turkish telecoms giant Turkcell. It confirmed that Turkey’s Sportoto Organisation had awarded its monopoly betting license to Sans Girisim instead – a joint venture between Nasdaq-listed Scientific Games and Turkish media conglomerate Demirören Holdings. SBC News speculates that a restructure of Intralot is now highly likely, although Inteltek (jointly owned by Intralot and Turkcell) will continue to manage the IDDAA sports betting concession until August 2019. (HGS)
The Armenian government is preparing to further its crackdown on gambling, having approved a bill introduced to parliament last month by vice speaker Alen Simonyan. The bill repeals the right to bookmaking and gambling in shops and filling stations, but it is not intended as an outright ban. Gambling will be allowed in the four designated resort regions of Tsakhkadzor, Sevan, Jermuk, and Meghri, with appropriate age validation processes in place. Progress on Simonyan’s bill follows news at the end of last year that the country had increased controls on gambling advertising and was in favour of raising the legal gambling age to 21. (HGS)
As usually happens when a country accepts applications for licenses to offer online gambling, many companies pile in, hoping to get a sufficiently large piece of the pie to operate profitably. To date, some 70 companies have applied for a license in Sweden, a country of approximately 10 million people. It is hard to see more than 10 percent of these surviving, especially when they are up against Svenska Spel, the former state monopoly that controls almost 40% of the market. (AT)
The British government is planning to increase the age limit for playing the National Lottery, according to comments by the Minister for Sport and Civil Society, Mims Davies, last month. People currently have to be over 16 to play the lottery in the UK, while all other forms of gambling are illegal prior to the age of 18. The discrepancy has been a long-standing bone of contention for the gambling industry, which often comes under fire in relation to under-age gambling despite so called ‘soft’ gambling products being far more easily accessible to kids. A recent report by the Gambling Commission found 17% of the children between 11 and 15 years old admitted to having bought scratch cards. (HGS)
Crack open the champagne! Germany´s 65 state-licensed casinos saw double-digit growth in 2018. Gross gaming revenues were up by almost 13 percent, slots up 15 percent, and table games up approximately 6 percent. Casino operators had been blaming years of declining revenues on the rise in online gambling, which is popular but technically illegal in Germany. Has online gambling fallen out of favour? Hardly. The increase is more to do with the forced closure of slot arcades, which had spread uncontrolled throughout the country. (AT)
This report is edited by Andrew Tottenham and Justin Martin
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