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EU Launches Consultation On Online Gambling

by Ulrika Lomas,, Brussels

30 March 2011

The European Commission (EC) has launched a consultation under which it is seeking the views of stakeholders, and collecting relevant detailed information and data, so as to obtain a facts-based picture of the existing situation in the European Union (EU) online gambling market and of the different national regulatory models.

It was noted that on-line gambling is a fast developing business in Europe, with almost 15,000 websites already identified and total annual revenues exceeding EUR6bn (USD8.4bn) in 2008, or 7.5% of the overall gambling market. It is the fastest growing segment of the gambling market and in 2008 was expected to double in size in five years.

The channels used to offer online gambling services are the internet, mobile applications and internet protocol television. National levels of demand for these online services vary across the EU depending on a number of factors. The UK, for example, is currently the largest market given that its e-commerce market is twice as large as the EU average. Germany is the second largest market.

At the same time, it was pointed out that the regulatory situation for gambling differs between member states. While some restrict or even ban the offer of certain games of chance, others have more open regulated markets. Some of the largest markets in 2008 were, however, member states characterized by the restrictive regulatory model - France, Germany, Italy and Sweden. A number of member states have also recently reviewed their online gambling legislation, or are embarking on such a process.

In order to ensure legal certainty and effective protection of EU citizens in this fast-growing cross-border service activity, the EC considers it important to evaluate how possibly differing models can co-exist within the EU. Contributions to the consultation, which can be submitted until July 31, 2011, will determine the need for and form of any EU follow-up action in this field.

The Internal Market and Services Commissioner, Michel Barnier, said: "With this Green Paper, we have launched an ambitious consultation with no pre-determined views on its possible follow-up. The online gambling market in the EU continues to grow rapidly and generates important revenues that are sometimes channelled into good causes. Its expansion must go hand-in-hand with a determination to protect our citizens, especially minors, and to ensure that offers of these types of services within the EU are sound and well-regulated.”

He added that the consultation “responds to calls from the European Parliament and the member states for us to address these questions jointly. This consultation is not about liberalization of the market, it is about ensuring that the market for online gambling services within the EU is well-regulated for all."

The EC sees the key policy issues as consulting on the main advantages and/or difficulties associated with the co-existence in the EU of different national systems and practices for the licensing of online gambling services; and the related services performed and/or used by online gambling services providers. The Green Paper is consulting on the rules and practices relating to online commercial communication, customer identification and regulations for payment systems for online gambling services and player accounts.

In addition, a section of the consultation focuses on other objectives which, to various degrees, may be valid for member states in terms of their national online gambling policies. For example, it aims to collect information on problem gambling and addiction and the measures pursued to protect players and prevent or limit such problems; to ensure the protection of minors and other vulnerable groups; and to detect and prevent fraud, money laundering and other crimes.

It is estimated that for each licensed online gambling website worldwide, there are more than five websites offering online poker or sports betting without having a licence. An illegal cross-border market is currently accessible to consumers. Given that, the EC also seeks to evaluate current enforcement systems and cross-border cooperation between member states and gather factual information on the efficiency of the existing blocking systems (such as payment blocking or domain name filtering).

A comprehensive report in our Intelligence Report series examining the new possibilities that offshore e-commerce open up for business, and analysing the offshore jurisdictions that have led the way in offering professional e-commerce regimes for international business, with a particular focus on e-gaming, is available in the Lowtax Library at and a description of the report can be seen at
TAGS: money-laundering | business | European Commission | commerce | law | offshore | internet | e-commerce | gambling | licensing | offshore e-gaming | regulation | European Union (EU) | Europe

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