The digital boundaries

‘A fair and safe chance between the game provider and the player’ (Netherlands, 2020). The government has to update the current gambling policy due to outdated legislation.

The last law on gambling dates back to 1964 and therefore needs to be amended (Netherlands, 2020). At that time, of course, the online casino did not yet exist. In addition, the European constitutions are superior to the laws of the Member States as laid down in the Lisbon Treaty. (Parlement, 2009). The outdated regulations have made the competition with the rest of Europe unfair for both game providers and players, which is why the government needs to update the gambling policy.

The Betting and Gambling Act 1964 does not describe anything about online gambling and therefore needs to be renewed. Foreign game providers are not allowed to offer services in the Netherlands, as this goes against the current legislation of the Netherlands. In 2018, the gambling provider ‘’ was fined €470,000 by the Dutch Gambling Authority (KSA), because they offered services to Dutch consumers. Unibet does not have a licence and therefore they are alleged to have broken the law. Europe is a common market and therefore a free trade zone for products, services, personnel and capital (Art. 56 TFEU). Therefore the national legislation is in contradiction with the European law and the European law is supranational.

This case is an example of a quantative restriction (Art. 34-35 TFEU), Measures having equally effect. The Cassis de Dijon ruling (Case 168/78 Commission v France [1980] ECR 347) can be applied in this case under the principle of mutual recognition, in relation to services (ENEPRI, 2020). When you can bring your product/service to one country, you should have the ability to bring it to the other countries.

The Dutch are currently not officially allowed to gamble online due to outdated regulations. However, a policy of tolerance exists, because the digital borders have not yet been determined (Belastingdienst, 2021). If you win an amount above €449 in the Netherlands you have to pay 30.1% gambling tax on the total amount (including the deposit). In other countries within Europe you pay less or nothing in terms of tax on games of chance and they only pay tax on the winnings, for example. In the case HR, 27-02-2015, nr. 14/03069 (Navigator, 2015). This example is challenged and won under the pretext of trade barriers (Art. 56 TFEU). Art. 6 Rome I.

Finally, the dutch government is forming a cartel, consisting of the government and companies below it, such as the Lotto and TOTO etc. Because nothing has been privatised, foreign game providers do not get a fair chance. Besides the fact that this violates the free movement of services, it also constitutes a cartel (Art. 101 TFEU). The abuse of a dominant position by means of national regulations, as a result of which no fair/free trade is possible. The so-called ‘one licence system’ was initially rejected, but later that year an agreement was still given under the guise of ‘horizontal consistency’, despite the fact that the gambling authority has converted two organisations into private limited companies and cooperate with each other, thus creating a monopoly (State, 2021). The government currently hides under TFEU 36.
With the forthcoming “Remote Gambling” legislation, foreign companies within the EU would be given a “fair” chance. This “fair” chance consists of bidding for a licence with a registration fee of €48,000. In the event of rejection, there will be no refund (KSA, 2021). In addition, the Postema motion is in force, which describes that to gain a licence is only possible if a party has not focused on the Dutch market in an unlicensed, active and specific manner for a consecutive period of two years. This is again in conflict with Art. 56 TFEU.

On the other hand, it does state that discrimination is allowed if the intention is to protect public health and interest (Art. 56 TFEU). Under this legislation, the KSA is therefore taking cover by sharpening its mission to ‘Play safely’. Of course, this plays an important role and the fact that a game provider must comply with a number of rules cannot be disputed. In Liga Portuguesa (C-42/07), the court denied this principle due to the fact that internet games are more dangerous than physically offered games (Art. 36 TFEU), even when it’s regulated and controlled. Second, the European Comission is tackling illegal online gambling, among other things, through new initiatives; ‘the Digital Services Act’ and ‘the Digital Markets Act’ (Lexology, 2021). The upcoming Gambling Remote Act that will officially come into force in October 2021. This law will tighten the rules, but there still won’t be a fair competition in this way.

The current and forthcoming legislation must therefore be amended, because it contradicts many European laws with which each Member State must comply. At the moment this is not happening and there has never been fair competition and free movement of services. The player and the game provider therefore do not benefit at all from this. The law of Europe is harmonized and in this discussion is ‘directive’, which states minimum standards, but the country chooses its own way to achieve the ‘standard’. Because this ‘standard’ for every country is too divergent, there is a new law upcoming. It has taken 7 years to create this new law, which is still failing to comply with the European supranational law and will still not be waterproof.