Developments In European Online Gambling

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Recently a few European countries came under fire from the European Commission (EC) and the European Gambling and Betting association (EGBA) for drafting online gambling legislation that was discriminatory and therefore unacceptable. The most talked about example is that of France. Last week, however, two European countries have released online gambling legislation that fits the bill.

In fact in Estonia the legislature has passed the regulations, which have become the Estonia Gambling Act. These are expected to come into force in January 2010. The Estonian law allows foreign online gambling operators licensed in other European Union jurisdictions to function in Estonia. However these operators will have to meet one of two requirements. The first option is that they have to obtain a license from Estonia, which could be an expensive proposition since the operators are already incurring the license fee of another jurisdiction. The other option is that they will have to be sub contractors of licensed state operators. The usual checks and balances have been incorporated into the regulations. These include background checks on the credentials of the operator, such as proper incorporation and capitalization. Adequate measures to prevent underage gambling and ensure responsible gambling must be in place. An important condition is that the servers of online gambling operators servicing the Estonian market must be on Estonian soil and open to inspection by designated regulators or independent auditors. Online casino operators functioning without a license will be illegal. Internet service providers will have to block access to such sites when notified. The transfer of funds to such sites will also be illegal.

Denmark was one of the countries that had faced flak from the EC for its protectionist online gambling policy. In 2007 the EC had ruled that Denmark was limiting online gambling to the state owned monopoly, Dansk Spil. It was not allowing fair competition from other online gambling operators. This went against the European Union policy of a single market. Now Denmark has changed all that. Its proposed regulations permit online gambling operators to compete with Dansk Spil in areas of online poker, sports betting and casino gambling. One of the strongest supporters of the draft legislation has been Ladbrokes. In fact Ladbrokes has confirmed that it would seek a license in Denmark once the proposed legislation was converted into actual law. Lasse Dilschmann, head of Ladbrokes Scandinavia, pointed out the contrasting attitude of online gambling in Denmark and Sweden. He said, "While the Swedish Government has chosen to put forth arguments for a gambling market inconsistent with the demands of consumers, Denmark now chooses another way." Before the draft proposal is discussed by the legislators in Denmark it needs official approval by the EC. However, that is expected to come easily.

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