Court of Justice Sides with Austria

19 September 2011

The European Union’s highest court ruled that Austria could ban foreign gaming firms from operating within its borders. This was a hard hit by online gambling companies trying to release the stronghold of national gambling monopolies.

A few online gambling companies have brought this up legally by bringing some of the EU member countries to court. With revenue of €80bn last year, there is much money at stake and so far they have had little success in court against EU members.

This latest fight came when, owned by two Austrians and including several Maltese subsidiaries having Maltese licenses, claimed that the rules set forth by these licenses were enough to protect consumers. Austrian authorities disagreed and the case went to the EU’s Court of Justice.

According to the ruling, the EU court said that member states could do what they deemed necessary to protect their citizens,

“When assessing the proportionality of a monopoly, the national courts are not required to take into account the monitoring and control systems regulating companies established in another member state,” it ruled. “A member state may legitimately wish to monitor an economic activity which is carried on in its territory, and that would be impossible if it had to rely on checks made by the authorities of another member state using regulatory systems outside its control.”

According to Friedrich Stickler, president of European Lotteries, this could be the final blow for mutual recognition among member states, “Those that keep on calling for ‘mutual recognition’ of gambling licenses between member states have now been dealt the final blow.”

The lobby group, The European Gaming and Betting Association, is using the ruling to call for “EU wide measures” It claims that the current “fragmentation of the Internal Market for online gambling is unsustainable and requires urgent action” and that it is time for the EU to work out a framework that works for everyone.

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