Harmonisation of gambling regulation in Europe
By Warwick Bartlett
I moderated a panel at the Stockholm I-gaming Forum in April 2015 on the subject of “Regulation and Legal Insights”. My panellists were Julian Harris from Harris Hagan, Peter Naessens from the Belgian Gaming Commission, Dr Simon Planzer from Planzer Law and Joseph Cuschieri from the Malta Gaming Commission.
One of the subjects discussed was the potential for harmonisation of gambling laws and regulation across the EU. The problem with even bringing up the subject is that the various EU member gambling commissions, with the exception of Malta, have a tendency to go on the defensive because they believe it is a Trojan horse to lead to a more liberal market and lower taxes, in other words the UK model which is not gaining much traction in Europe.
I do understand their point of view.
Indeed, Peter Naessens put it very well. He said that Belgium is a small country with a ten million population and we could not have too many licensees, the market could not stand it. Of course, the market would ultimately decide the number but what Belgium is wishing to avoid is the intense competition and a plethora of advertising possibly leading to problem gambling until the market sorts itself out.
Putting that on one side there are other areas where harmonisation could be beneficial to operators and government.
An issue worthy of discussion and first introduced to the panel by Julian Harris was the harmonisation of testing standards.
Julian said “Whilst harmonisation in the sense of a pan-European regulatory and licensing system is almost certainly unrealistic in the foreseeable future, there is considerable scope for much greater harmonisation between jurisdictions on single issues, such as testing standards, application requirements and pooling liquidity. The EU Working Group of regulators has made good progress, but there is a long way to go. The continued spread of national point of consumption licensing regimes, and the associated costs of compliance for operators creates an obvious need for urgency and a greater appreciation of the international nature of this industry if it is not to be submerged under a multiplicity of different regimes, which may in turn make some smaller jurisdictions non-viable markets in which to operate.”
There are several companies that have been approved to test games so that their performance reach an acceptable standard of probity ensuring that the customer is not cheated and the games are run fairly. Yet I am told that every jurisdiction has different standards but the same testing companies operate throughout. Would it make sense for the regulators to get together and agree a common set of standards?
Once approved, in say Italy, the same game operated by the same firm in Denmark would automatically have a testing certificate. That same certificate would passport them throughout the EU?
It would save not only money but a lot of time and resource and it makes perfect sense. Short term it would hit the testing companies. Long term it would ensure a better quality to their earnings because the way things stand with higher licensing costs, compliance and tax increases the market will consolidate leading to fewer companies to sell to.
This would at least be a start towards harmonisation of the basic tools essential to running a gambling website. Not tax, not number of licences, just testing.
The EU is all about harmonisation of standards between the member states. We have standards on food, electrical products, cars, all manner of things. Gambling is a relatively new industry in the EU so perhaps it is going to take time for regulators to catch up. But with rising operational costs that time has come.