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Italy has been convicted twice before the European Court of Justice for its gambling legislation, lack of clarity and infringement of the EU treaties. But where do we go from here?
Is the main result of these decisions the fact that Italian market is open for every new competitor ? Well, things are more complicated than it seems – Simon Banks has an interesting article that describes the present situation :
The liberalization of European gambling markets is proving long and somewhat tortuous as state monopolies struggle desperately to hang on to their privileged positions, despite the European Court of Justice consistently ruling in favor of operators trying to break into potentially lucrative markets. … Nowhere has the process been more fractious than in Italy, where two landmark rulings by the ECJ appear to have finally persuaded the Italian authorities that a system of licensing and regulating foreign operators is preferable to attempting prohibition.
(…)
With a relaxation of the regulatory regime thanks to pressure from Brussels, the Italian market would appear ripe for exploitation. However, an understanding of the Italian market and sports betting culture will be crucial for any operator seeking to take advantage of developments. While European operators, with their sports betting expertise, are leading the first wave of new entrants to the Italian market, it will probably be casino companies that will profit in the long term if, as expected, Italy eventually opens up its gaming market as it has its wagering market.
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The UK Gambling Commission, a UK body sponsored by the Department for Culture Media and Sport and established under the Gambling Act in 2005 that is unded by betting licensing fees, has the responsibility of regulating betting and remote gaming for the UK.
The Commission has adopted on 28 December 2007 a Guidance document for online and offline casions on how they shoudl comply with the new UK regulation – Anti-Money Laundering Regulations (AML), which come into effect on 15 December 2007, and the Proceeds of Crime Act (POCA).
This document is a must read for casinos – not only for the ones in UK - The Prevention of Money Laundering and Combating the Financing of Terrorism. Guidance for remote and non-remote casinos. Guidance to remote and non-remote casinos concerning their responsibilities under the Money Laundering Regulations, which came into effect on 15 December 2007, and the Proceeds of Crime Act.
The document also received seven answers during the period of public consultation, that are also available online.
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This is not a new report from the EU, but without any doubt the most important one related to the EU Policy in this domain.
“STUDY OF GAMBLING SERVICES IN THE INTERNAL MARKET OF THE EUROPEAN UNION “ was commissioned by the EUÂ and has a proeminent role on the Gambling page at the Internal Market Services of the European Commission website.
The report reflects the situation until 31 December 2005 and was published on 14 June 2006. The study was made by the Swiss Institute of Comparative Law that focuses on the legal and economical issues related to gambling in the EU member states.
This is a must read for everyone that is interested in gambling policy in EU and suggest 2 Scenarios of future growth in the EU Gambling Industry . The report also includes several chapters in realtion with online gambling, of course.
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  An interesting presentation from Emeline THOMAS :
National approaches, the international community and gambling online help to highlight the difficulties presented by the Member States to abide by the requirements of the European Community and the World Trade Organization.
The interest in this subject is to demonstrate the complexity of the legal sector gambling online. Because of the international nature of this type of activity, several national regulations are applicable. Currently each member state has its own design of the regulation of gambling. However, the first mission assigned to the Community is the realization of a common market. This objective is stated in Article 2 of the EC Treaty: “The Community’s mission by establishing a common market and an economic and monetary union by implementing policies or actions ( …) to promote throughout the Commonwealth a harmonious, balanced and sustainable economic activities. . ” To achieve this objective, Article 3 of the EC Treaty requires four components, namely the various freedoms of movement: “Community action (…) has an internal market characterized by the abolition, as between member States, of obstacles to the free movement of goods, persons, services and capital. . ” Member States must comply with the objectives of the EC Treaty in order to implement the common market.
Read more »
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I found, via Net Bet Blog a great article regarding UIGEA (Unlawful Internet Gambling Enforcement Act) and its effects on the US Market. The article ” Internet Gambling Act Should Be Scrapped” appeared in Bloomberg
and points out the moste important problems with the enforcement of this act.
The author is Joe Saumarez-Smith is chief executive officer of Sports Gaming, a U.K. management consulting firm to the gaming industry. He also owns European online bingo companies and odds comparison Web sites.
Here are some snippets :
As America learned during Prohibition, some bans are unrealistic. The online gambling law shows that legislators weren’t paying enough attention in history class.
At least Prohibition aimed to prevent the consumption of alcohol across the U.S. without exceptions. Banning some types of online gambling while allowing exemptions for lotteries and horse racing is protectionism of the worst kind.
…. Read more »
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The study released by the UK Gambling Commission today – 19 September 2007 – shows that the gambling problem has not increased in the last 8 years, despite the contradictory opinions of “many experts” that warned of the “unlimited dangers” of the online gambling issues.
Some essential issues of the report :
- 68% of the population, that is about 32 million adults, had participated in some form of gambling activity within the past year. This compares to 72% (about 33 million adults) in 1999.
- For around 10 million people, their only gambling activity in the past year had been participating in a National Lottery draw. In 1999 this figure was 11 million.
- 6% of people used the internet to gamble (3% did online gaming like playing poker or casino games and 4% placed bets with a bookmaker)
- The rates of problem gambling in the adult population was about 0.6%, this equates to about 284,000 adults. This is the same percentage of the population the same screen identified in 1999.
Full Report – British Gambling 2007
Executive Summary British Gambling Report 2007
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JUDGMENT OF THE COURT (Fourth Chamber)
13 September 2007 (*)
(Failure to fulfil obligations – Freedom of establishment and freedom to provide services – Public service concessions – Renewal of 329 horse-race betting licences without inviting competing bids – Requirements of publication and transparency)
In Case C‑260/04, ACTION under Article 226 EC for failure to fulfil obligations, brought on 17 June 2004,
Commission of the European Communities
vs.
Italian Republicsupported by:
Kingdom of Denmark and Kingdom of Spain
Judgment
1Â Â Â Â Â Â Â By its application, the Commission of the European Communities seeks a declaration by the Court that, by renewing 329 licences for horse-race betting operations without inviting any competing bids, the Italian Republic has failed to fulfil its obligations under the EC Treaty and has, in particular, infringed the general principle of transparency and the publication requirement resulting from Articles 43 and 49 EC.
Read more »
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The study is called by the Nevada congresswoman Shelley Berkley that wants to put it as part of a bill against the UIGEA.
Berkley, a self-confessed campaigner against the prohibition laws in America, is keen to see the UIGEA repealed. However, she wishes to make clear her stance on stimulating an objective viewpoint.
She recently told a Las Vegas journal, “One of the advantages of this legislation is that it doesn’t take a side. It doesn’t say internet gambling is good or bad. It says ‘Let’s study the issue.â€
The bill has some house support, with 60 co-sponsors of the bill including Barney Frank, John Conyers and Frank LoBiondo.
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A recent editorial from LA Times makes a good point on the US policy towards gambling that shifts from the recent UIGEA law that prohibited credit card companies from processing gambling transactions to a new licensed environment suggested by the Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee.
All that in combination with the WTO-gambling conflict with Antigua, that continues to put USA in a strange position, claiming that “it was not required to comply with a WTO ruling to open its borders to the Internet gambling industry because of an “oversight” in a decade-old trade agreement.”
This stupid attitude saying – we will change the WTO terms cause we’ve changed our mind -Â shows why WTO is good only for the big countries.. Show me the contrary, please..
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A report published by the research group MECN predicts that Italian Gambling market will grow with 64% until 2010. Internet Betting is one of the biggest growth driver !
Accordingly with the new decisions of the European Court of Justice, at the
beginning of 2007 nearly 14.000 new betting licenses (for sports and horse race betting
shops/terminals) were awardedm, including major companies of global gambling:
Ladbrokes, Intralot, William Hill, Betfair, Gala/Eurobet, etc.
Also more than 30 new online/interactive gambling operators obtained a license and will push the market forward to new heights.
The study identifies several reasons why Italy is perceived as so attractive:
- Another phase of liberalisation is expected in the near future – Two-thirds of the experts surveyed expect another phase of liberalisation in the near future that will go even further than the steps planned for 2007.
- Growing relevance of foreign operators – A large majority of the experts believe that by 2010 international operators, such as Ladbrokes and Intralot, will capture a relevant share of the gambling market.
- Growth potential, especially for retail betting and interactive gambling – Overall, Italy’s gambling market is expected to grow to Euro 61 billion in turnover by 2010 (+64 percent). By 2010, the retail betting market is expected to grow to ca. Euro 14 billion, which is about 200 percent its current size (CAGR of 32 percent).
- Another growth driver will be interactive gambling, which is expected to reach ca. Euro 3.7 billion by 2010, a growth of ca. 240 percent over the current level (CAGR of 40 percent).
See the summary of the report.
Buy the entire report – Italian Gambling Market – A Forerunner in the Liberalisation of European Gambling Markets