The climate in the Netherlands’ gambling industry has changed drastically after the Senate officially approved the remote gambling bill.
The last step towards the legalisation of online gaming closed a chapter of a long and uncertain decade. For most, the process of resolving the status of internet gaming was fastidious and unnecessarily delayed – the first proposals were submitted back in 2011, yet it wasn’t until 2019 that the Dutch Senate debated the Remote Gaming and Casino Reform Bill, having scheduled the final vote for February 12.
Those who were holding their breath, waiting for the Dutch market to open and initiate the end of the government's Holland Casino monopoly (at the time, thought to be inevitable), were left dumbfounded by the latest turn of events. After eight years of preparing the ground for Holland Casino privatisation, which was considered as the natural outcome of the legalization, the Dutch government has now withdrawn the bill, leaving the potential bidders empty-handed.
The sudden decision to put an end to an almost decade-long project, according to which Holland Casino’s properties were to be sold to the highest bidders, conveniently coincided with the casino operator’s estimate of the future annual revenue. The preliminary research has indicated that the licensed market is worth around one billion euros.
On top of that, some 300 online gaming operators have expressed keen interest in applying for the gaming licence and taking their share of the market, which holds approximately 1.5 million Dutch adults. The numbers seem to have struck a noble chord with the Dutch government, and the tune has rapidly changed.
While the new online gambling law is expected to take effect by 2021, the privatisation plans (which emerged during the 2008-2009 financial downturn) have been dismissed until further notice – possibly for ever. Apparently, with the casino’s return in the black, the government has had an epiphany about the free markets, realising that “political control of the gambling industry is higher on the agenda,” to quote Willem Van Oort, founder of Gaming in Holland.
In other words, the recent changes in the Netherland’s gambling milieu are likely to trigger a severe outburst of gambling addiction, underage gambling, and money laundering. The privatisation of Holland Casino in such a tender moment would only add fuel to these burning issues, which is why it was deemed best for the casino to remain under government control.
After receiving hundreds of Dutch Gaming licence applications, the Dutch Gaming Authority (Kansspelautoriteit) has increased the penalty rates and tightened the noose around those who provide gaming services to Netherlands residents.
This time there were no delays, and the new rates were swiftly applied. Casumo and Casino.com have been the first in line to suffer the consequences of accommodating Dutch gamblers.
In April 2019, Casumo, regulated by the Malta Gaming Authority was ordered to pay €310,000 fine, while Casino.com (licensed by the government of Gibraltar and the UK Gambling Commission) is to pay €310,000.
The question remains – will blocking Dutch customers be a better business model than accepting them and complying? Quite possibly. Apart from the €45,000 licence application fee and the development costs, the operators will also be obligated to cover the games of chance taxes and provide financial guarantees. Gambling experts made up the bill: about €2 million extra costs to comply and about €1 million yearly to remain compliant. Extra, above all operational and marketing expenses.
Since it is still uncertain if the Dutch market is prolific enough to compensate for the expenses, it almost seems as if the Dutch government has decided to pressure the Maltese operators into making a final decision – apply or retreat.