French Debate Internet Gaming Regulation

by Ulrika Lomas, Tax-News.com, Brussels

12 October 2009

The European Gaming and Betting Association (EGBA) considers that the French draft law to regulate internet gaming, recently debated in the French National Assembly, still conflicts with European law.

“Several key restrictions in the draft do not serve any general interest purpose, whether consumer or public order protection” says Sigrid Ligne, Secretary General of the EGBA.

The opening of the horserace betting market, being limited to pool betting only, is based on the sole justification that it is a “French tradition”. The EGBA does not approve of the fact that it will not allow the offering of fixed odds bets on horse races to French players, while this type of popular bet will be authorized for all other sports.

EU operators are forced to cap their payback ratio to players, allegedly for the sake of limiting problem gaming, but the EGBA suggests there is no evidence of such problems. New entrants will lose the chance to improve the attraction of their offer with a competitive payback. The average ratio percentage of stakes paid back to players is currently 75% and 78% for the current French operators while online EU operators usually pay back 95% to players according to the EGBA.

EU operators may be forced to establish an IT platform in France in order to provide data which could, in full transparency, be provided cross-border from their existing IT platforms. The EGBA thinks it would lead to duplications and create a clear operational and financial disadvantage for non-French operators.

The EGBA opposes the introduction of a “sports betting right” because:

• it grants sports entities ownership of information currently in the public domain (name and results of events or fixture lists) and also used by other professions such as journalists;
• it will favour the most attractive competitions and sports federations at the expense of less visible sports;
• most EU regulated operators already enforce early detection systems at their own cost which allows them to block suspicious bets and alert in real time the relevant sports authorities.

The EGBA questions whether the French model will be workable and economically viable. “Ring fencing the French market goes against the cross-border nature of the Internet and would lead to the emergence of an underground and uncontrolled market where consumers would be deprived from any protection,” added Sigrid Ligné.

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