Online Gambling Policy

The European Commission says that, to better protect children and other vulnerable groups from the dangers of online gambling, a comprehensive set of actions is needed.

This is the main thrust of a new Communication, which aims to protect minors, deter fraud and maintain the integrity of online gaming.

While EU-wide legislation is not on the table, the Communication proposes to establish an expert group to exchange information, experience and best practices among member states.

Context

Online gambling is one of the fastest growing service activities in the EU, with annual growth rates of almost 15% and an estimated €13 billion in annual revenues in 2015. The Commission believes that children and other vulnerable groups need protection however, as 75% of EU citizens under the age of 17 use the internet.

It is also concerned that national rules covering consumer protection, money laundering, fraud and identity theft in online gambling should be better aligned with EU law.

This Communication follows the publication of the Commission’s 2011 Green Paper on online gambling in the internal market, and also responds to the other EU institutions conclusions, reports, resolutions and opinions.

The Communication

The Communication sets out five priority areas, which address the challenges of online gambling in the EU. It then sets out what action it would like to see:
• Compliance of national regulatory frameworks with EU law
• Enhancing administrative cooperation and efficient enforcement
• Protecting consumers and citizens, minors6 and vulnerable groups
• Preventing fraud and money laundering
• Safeguarding the integrity of sports and preventing match-fixing

The Communication also proposes to establish an expert group on gambling, composed of representatives of Member States to exchange information, experience and best practices and to participate in preparation of EU initiatives.

Compliance

National legislation covering online gambling is diverse (most member states have established a licensing system on the gambling market).

However, online gambling services are often of cross-border nature. According to the European Court of Justice (ECJ) these activities fall under the fundamental freedoms of the Treaty on the functioning of the EU (TFEU). Member states may restrict or limit certain types of services in order to protect the public interest.

The Commission would like to accelerate its assessment of national legislation in the pending infringement cases and complaints, and strengthen enforcement action.

Enhancing administrative cooperation

Regulatory authorities and cross-border administrative cooperation need to be in place to ensure effective implementation and enforcement of gambling rules.

The first step to be taken is the exchange of general information and best practices. As a second step, the Commission says it will explore the possibility of an exchange of personal data. Dialogue with third countries will also be enhanced to tackle the cross-border challenges.

Preventative and responsive enforcement measures would be introduced at national level to ensure effective enforcement. Preventative measures reduce consumer exposure to online gambling services that do not comply with the legislation in force. Responsive measures limit access to unauthorised gambling services.

Protecting consumers and citizens

The Commission proposes EU-wide action to:
• Protect consumers from unregulated and potentially harmful offers
• Protect minors and other vulnerable groups from gambling facilities
• Prevent the development of gambling-related disorders

In this area, the Commission says it will propose a recommendation on common consumer protection principles, including effective and efficient registration of players, age verification and identification controls, reality checks, no credit policy, protection of player funds, self-restriction possibilities and customer support.

Minors should be precluded from gaining access to gambling content, for instance via appropriate notice on gambling websites. Parental awareness and software filtering should complement these actions. Responsible advertising needs to be enhanced to ensure consumer protection. These measures will be further developed in other Commission Recommendations.

A better understanding of gambling-related disorders is also needed, along with an examination of the adequacy of preventative measures and types of treatment. The Commission will gather relevant data through ALICE RAP research project.

Preventing fraud

Credit card fraud and banking credentials and identity theft are among the most widespread crimes related to online gambling. Online gambling may also be used for money laundering.

The Anti-Money Laundering Directive currently only applies to casinos. The Commission will therefore consider extending its scope under review clause to online gambling.

Identity theft, fraud and other cybercrimes are currently addressed in a proposal on European Cybercrime Centre. The Commission will explore the possibility of introducing an EU standard on gambling equipment certification in 2013.

Safeguarding the integrity of sports

Cooperation in the fight against match-fixing exists, but is limited. The Commission would like to encourage more cooperation agreements between all the stakeholders (gambling operators, sport organisations, regulators) to create national focal points.
The Commission will elaborate on anti-match fixing measures in a Recommendation in 2014 to:
• Promote an efficient exchange of best practices
• Ensure mutual reporting and follow-up actions
• Establish minimum conflict of interest provisions
• Introduce hotlines and other reporting and whistle-blowing alert mechanisms

Match fixing is illegal in all Member States and enforcement of applicable legislation should be strengthened.

The Commission will launch test projects aimed at promotion of international cooperation in the prevention of match fixing under 2012 Preparatory Action for European Partnerships in Sport.

It will also continue to work closely with the International Olympic Committee (IOC) and the Council of Europe to address these issues.

Next steps

The Commission will call for a first meeting of the expert group on gambling in 2012 and initiate a dialogue with all stakeholders. Stakeholder conference will take place in 2013.

The evaluation report on the implementation of this Communication with a view of possible further measures will be published within 2 years of adoption of this Communication.