The last months have been characterised by a series of legal developments at EU level: landmark judge­ments were delivered by the European Court of Justice, an increasing number of preliminary cases were filed, and several opinions of Advocates General were published, not to mention the infringement cases instituted against a number of EU member states at the behest of the European Commission.

Evidently, there is need for greater legal certainty in the realm of online gambling. A Green Paper on the matter is due for publication in the coming months in order to avoid further ad-hoc rulings by the ECJ in relation to gambling regulation in Europe.

Until now, however, the judgements of the EU regulate online gambling operations on an EU level, particularly the limitation of cross-border supply of gambling services, and such judgements probably will be the basis of any future EU legislation on the matter. A look at the guiding principles set forth in these judgements is therefore warranted.

Exclusivity in the online provision of gambling services is not necessarily illegal. The grant of exclusive rights of online operation to a single gambling operator may be regarded as appropriate for the purpose of protecting consumers against fraud on the part of operators. In dealing with German rules on sporting bets, the ECJ however held that the state monopoly created by those rules constituted a restriction on the freedom to provide services and freedom of establishment, which was not justified to protect the public interest, such as combating gambling addiction.

Indeed, intensive advertising campaigns encouraging gambling in casinos and automated games by the state monopoly flew in the face of the justification that was being raised by way of a justification for the existence of those rules. Member states therefore must be consistent in their approach to the way they regulate the sector.

On the same lines was the ruling of the ECJ in relation to Austrian legislation, which only allowed companies with their seat in Austria to operate casinos. The Court noted that this contravened EU rules on the freedom of establishment and discriminated against companies with their base in another member state.

Yet, national regulation on operators established in a different member state is, in principle, allowed. Thus, a member state is entitled to subject an operator lawfully offering gambling services via the internet in another member state in which it is already subject to statutory conditions and controls of that member state, to its own regulations.

Member states are not obliged to recognise licences issued in other member states, and can require operators to obtain authorisations from their own national authorities on the grounds that the statutory conditions and controls of that other member state may not amount to a sufficient assurance for national consumers against risks of fraud and crime.

Essentially, the guiding principle is that member states can derogate from their obligations to ensure freedom in the provision of services. Considerations of a cultural, moral or religious nature can all justify restrictions on the freedom of gambling operators to provide services.

Dr Grech is an associate with Guido de Marco & Associates and heads its European law division.

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