European Commission acts against gambling laws of member states

The European Commission launched formal infringement proceedings against the online gambling legislation of 6 Member States and issued 2 'reasoned opinions' against Sweden for failing to comply with EU law. This move follows repeated calls from the European Parliament for the Commission to act as the Guardian of the Treaties and significant legal clarifications by the Court of Justice on how the Treaty applies to national gambling legislation. Similar decisions against other Member States are expected to follow.

The Commission sent letters of formal notice to Belgium, Cyprus, the Czech Republic, Lithuania, Poland and Romania with regard to their online gambling legislation. Sweden, which already was subject to an infringement proceeding, was today sent two reasoned opinions, formal requests to bring its legislation in conformity with EU law rules and the last step before potential litigation at the Court of Justice. Sweden has a 2 month deadline to reply to the Commission.

Estimates put the revenue from Malta's growing igaming cluster at 10% of GDP and with some 6,000 people directly employed in this industry sector, the scene may be set for further growth spurred by this latest round of political activity.

With the Maltese jurisdiction beginning to leverage its 10 years of expertise, there may now be renewed interest in exploring EU opportunities in a more systematic way based on yesterday's news from Brussels and looking for consensus on how to develop the Single Market for services to Malta's advantage in this emerging context. With the EU taking up its role of guardian of the EU treaty certainly indicates that Maltese businesses can seize the opportunity, not only for the gambling contribution to Malta but also for the remote gaming sector which is the primary driver of Maltese Digital Economy, attracting strong foreign direct investment and with highly positive spill-over effects into other digital sectors of the Maltese economy.

These are the first series of decisions from the European Commission regarding outstanding complaints and pending infringement cases against over 20 Member states.

Whilst the Commission has closed some complaints, cases against inter alia France, Germany, Greece, Hungary and the Netherlands remain under investigation and are awaiting formal decision. The decision to restart gambling infringement proceedings is a significant step as its last comparable action dates back to February 2008. 

The Commission´s action follows repeated calls from the European Parliament - most recently in its June 2013 report 'Online Gambling in the Internal Market' - for the Commission to "continue to monitor and enforce compliance of national laws and practices with EU law,...,and to launch infringements procedures against those Member States that appear to breach EU law."

It is based on recent clarifications by the CJEU on how the Treaty applies to the (online) gambling sector.

National rules which prohibit gambling services authorised in other Member States were found to restrict the freedom of residents to receive services offered in other Member States. Furthermore, gambling licensing regimes must be transparent, non-discriminating and non-arbitrary. Most importantly, the CJEU has clarified that national regulation must be overall consistent in its objectives and measures and that it is for the Member State to prove that imposed restrictive measures are suitable and necessary.