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European Commission to Take Action against Member States that Ban Gambling

October 10th, 2007 · No Comments

The European Commission’s internal market commissioner, Charlie McCreevy, has said that he will seek to take action against six European Union member countries for their contradictory laws on gambling.

McGreevy said that Germany, Finland, Sweden, Italy, Holland and Hungary violate European Union trade law by banning certain types of gambling or gambling advertising while allowing a national lottery.

“We should proceed against all these countries,” Mr. McCreevy said in an interview on Friday. Prosecution in a European Union court may lead to large fines.

These nations cite social concerns as the reason for restrictions on gambling or gambling advertising. However, many gambling operators say that the real reason for the contradictory approach is that these nations want to maintain their gambling monopolies.

“The official reason for opposing other forms of gambling is out of social concern,” said Torbjorn Ihre, head of public affairs at the European Betting Association, “but the real reason they want to restrict other gambling outlets is because they don’t want to lose the contributions to state coffers they get from their national lotteries.” The Brussels- based European Betting Association is comprised of internet sports gambling companies.

The state lotteries in these countries bring in millions and even billions of dollars each year, much of which is used for public services. The national governments of many European nations, which have expensive social service systems, have become dependent on this money, and are not at all eager to share the wealth with private gambling operators from other nations. They are also, they say, hesitant to lose control of gambling in their countries for fear of money laundering, underage gambling, and other social ills.

Lottery operators argue that they alone are able to benefit state governments while keeping gambling at a reasonable level.

According to Tjeerd Veenstra, spokesman for a Lausanne, Switzerland- based lottery trade association, “We have a system where lottery operators and governments are working together to control gambling. If it were left to private companies in a free market, the margins would be small and the only way to increase profits would be to incite people to gamble more frequently.”

“Public-order reasons are the first reason why this should be left to us,” Mr. Veenstra said. “A second reason is that the revenues from lotteries go back into society, into good causes that benefit society.”

Lotteries in Europe generate around 80 billion euros in revenue in each, around 30 billion of which ends up in state coffers.

As beneficial as the state lotteries may be, the European Court of Justice in Luxembourg has ruled that member countries may not both ban gambling for social reasons and sponsor a lottery. This most recent attempt to enforce that ruling will be decisive in mapping the European gambling scene.

Tags: european commission, european union member countries, state lotteries

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