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Operators Challenge Incoming Greek Gambling Regime

by Ulrika Lomas, Tax-News.com, Brussels

02 December 2011


The European Gaming and Betting Association (EGBA) and the Remote Gambling Association (RGA) have filed a complaint with the European Commission on Greece's controversial, recently-adopted online gambling law, which would allow the provision of taxed gambling services.

The complaint relates to the Greek regime's tax and non-tax barriers to market entry, which the Associations have alleged infringe EU law.

“The new regulation, which plans to open up the market to competition, has already been criticized by the European Commission regarding its compatibility with EU law when Greece submitted its first draft of the legislation in June this year. However, despite the Commission’s comments, a number of anti-competitive and unjustified restrictions remain in the adopted law,” the Associations said in a joint statement.

“These [restrictions] place unnecessary and unjustified economic burdens on new operators, such as forcing them to have a permanent establishment in Greece and limiting financial transactions to Greek banks. The law also imposes a higher age limit for online than offline gambling with no justifiable evidence to support that restriction.”

In addition, the EGBA and RGA, which between them represent the majority of the largest European remote gambling operators, are particularly concerned about the new tax regime. The regime will require licensed gambling operators currently operating in Greece to potentially pay their taxes on any revenues earned from Greece-based customers retroactively from January 1, 2010, until the new licences have been awarded. The Associations argue that this provision is tantamount to a market entry fee that will have to be paid by all of the operators which are currently unable to be licensed in Greece.

At the same time, the Greek government has also decided to grant OPAP, the incumbent monopoly gambling operator for offline games, an extension of its existing licence for an additional 10 years from 2020 to 2030 in “a wholly uncompetitive and non-transparent fashion”, the Associations say. OPAP currently pays no gambling tax on its offline activities, whereas online operators will be required to pay 30% of gross gambling revenue. This differentiation in tax liabilities is subject to a separate State Aid challenge which has been lodged with the European Commission.

Commenting, Sigrid Ligné, Secretary General of EGBA, said: “Commissioner Barnier recently confirmed to the European Parliament that the he would fulfil his responsibilities seriously in assessing the compliance of member states gambling legislation with EU law. Allowing Greece to proceed with this legislation unchallenged would represent an abject failure of those responsibilities. We trust the Commissioner will urgently investigate our complaint against Greece and take action accordingly against Greece as well as on several other pending complaints.”

Clive Hawkswood, Chief Executive of the RGA, added: “We have welcomed the opening of the Greek online gambling market as a positive step. However, it is paramount that any new regime is conducted in a fair and transparent fashion which follows EU rules. Where a regime is contrary to the provision of [European law], challenges are unfortunately necessary and unavoidable. We therefore look to the Commission, as guardian of [EU law], to enforce those provisions in relation to gambling, as the European Parliament has recently requested.”

TAGS: court | compliance | tax | European Commission | gambling tax | commerce | law | internet | e-commerce | gambling | legislation | Greece | regulation | services | Europe

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