Gambling Operators Get Favorable Ruling From European Court of Justice

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The European Court of Justice has issued a ruling stating that national regulators may not discriminate against foreign operators trying to enter their market from other European nations. The ruling is considered to be a win for gambling operators who are looking to enter restricted markets.

The ruling was issued on Thursday and regarded the joint cases of Costa and Cifone and their attempts to gain access to Italian gambling licenses. The court ruled that national legislation may not seek to protect the position of incumbent operators. Many European nations have set to protect national gambling interests though blocking outside gambling companies from operating within their borders.

The Court of Justice ruled that a country may only restrict outside operators from trying to obtain licenses only if it does “not have as a true objective the protection of the market positions of the existing operators."

The court ruling also stated that: “The very fact that existing operators have been able to start up several years earlier than the operators unlawfully excluded confers on them an unfair competitive advantage (which) constitutes a new breach of Articles 43 EC and 49 EC and of the principle of equal treatment."

"The objective of ensuring continuity, financial stability or a proper return on past investments for operators cannot be accepted as overriding reasons in the public interest" it added, also noting that in cases where nations justify restrictions on grounds of reducing gaming opportunities and combating criminality this cannot stand where the Member States "has long been marked by a policy of expanding activity with the aim of increasing tax revenue."

The court found that moves by Italian regulators to protect the gambling market are not consistent with the claimed objectives of protecting punters from addiction and limiting gambling activity. The court stated that the aim of the current Italian gambling legislation is to protect incumbent operators and raise tax revenues. Those objectives cannot justify violations of EU law, the court said.

Commenting on the ruling, European and Betting Association Secretary General Sigrid Ligné said “This very positive ruling confirms that national legislation that opens up and regulates the gambling market may not discriminate against new operators but must guarantee fair market access.

“The Court has made particularly clear the ‘red lines’ that Member States must observe when they regulate gambling; it is high time for the European Commission to enforce the consistent case law of the CJEU and pursue complaints and infringements procedures accordingly ”

Stanleybet CEO David Purvis also commented, saying “Stanleybet has received from the CJEU a definitive recognition of its right to enter the Italian market under conditions of equality and fairness vis-a-vis the other national operators."

“This ruling confirms once again that Stanleybet was discriminated against by the Italian Republic. After twelve years of legal battles, this third CJEU ruling must surely put an end to the unlawful distortions, the discrimination and the unjust limitations of the Italian licensing system."

"The European Commission must also take heed from this following its 2010 decision to close the Italian infringement proceedings. The decision of the CJEU indicates that this closure was premature. I hope this is a lesson to be learned and from now on the Commission will not allow political considerations to overtake EU law in other jurisdictions such as France, Greece and Germany."