Denmark Must Change Stance on Internet Gambling

From The European Gaming and Betting Association:

Denmark continues to ignore the Commission's reasoned opinion. EGBA, the association of leading European online operators, therefore urges the Commission to back up their own words with actions and take the next step: Initiate an ECJ-trial against Denmark.

As licensee under the Danish Pools and Lottery Act (tips- og lottoloven), Danske Spil is the only enterprise that can lawfully offer games, lotteries and bets comprised by the Act.

Section 10 of the Act expressly lays down that no one except the licensee (Danske Spil) may offer games comprised by the Act in Denmark. Furthermore, no one except the licensee may arrange for participation in such games offered by anyone other than Danske Spil.

In its reasoned opinion of March 21, 2007, the Commission univocally emphasizes that the Commission considers the Danish Pools and Lottery Act incompatible with existing EU-ruling (especially Article 49 of the EC Treaty). Furthermore, the Commission concludes that the measures taken by Denmark to restrict the free movement of sports betting services have not proved to be necessary or proportionate. Therefore, the Commission in its reasoned opinion warned the Danish State: 'If there is no satisfactory reply within two months, the Commission may refer the matter to the European Court of Justice'. However, Denmark continues to infringe the EC Treaty, thereby keeping EGBA's members out of the Danish market.

The Commission has so far launched legal action against ten countries. Besides Denmark, reasoned opinions have been sent to four countries: Finland, Hungary, France and Sweden. Letters of formal notice, the final step before court proceedings, have been sent to Greece, Austria, Italy, the Netherlands and Germany.

Both from a legal and political point of view this is of course completely unacceptable. EGBA therefore urges the Commission to back up their own words with actions and take the next step: initiate an ECJ-trial against Denmark.






Most recent discrimination against the online gaming industry in Denmark

Several operators have been discriminated against in Denmark over the last six months with EGBA members such as Unibet and others continuing to be mocked and discriminated by the Danish monopoly.

In November 2006, a Danish High Court upheld the Ministry of Taxation's refusal to grant a gambling licence to Ladbrokes, finding that the state monopoly (held by Danske Spil) did not breach EU law on free movement of services. Ladbrokes' arguments, based on the Gambelli ruling by the ECJ were rebutted on the basis that Danske Spil is a non-profit organisation which contributes to preventing gambling addiction. However, Ladbrokes appealed the High Court's decision, and a new decision is expected from Supreme Court ultimo 2007 or primo 2008.

Furthermore, Unibet was in July 2007 asked by the Danish Gambling Authority to withdraw its name as sponsor from the upcoming Danish national cycling Tour "Post Danmark Rundt". This decision came as a surprise given that Unibet was granted permission in 2006 to take part in the "Post Danmark Rundt". Not only does this demonstrate inconsistency in the treatment of foreign operators, it also discriminates against them. The Unibet-cycling team was subject to police interviews and an official police investigation was conducted in relation to the team's participation in the Tour of Denmark, while - in contrast to this - the cycling team sponsored by the Belgian National Lottery could, most surprisingly, participate without being subject to any restriction. Strangely enough the Belgian National Lottery did not have to answer to any request from the competent authorities.

Also in July this year, Unibet - along with a number of other online operators, received a letter from the Danish monopoly (Danske Spil) asking them to stop providing services on the Danish market.




Danske Spil compares the industry with the American mafia in the 1930s

Despite the warnings from the Commission, the whole industry continues to be discriminated against by the monopoly, Danske Spil, in Denmark. Recently, the Danish monopoly compared the industry with the US mafia of the 1930's.

In the beginning of October 2007, Danske Spil launched a value based image campaign for gambling that throughout placed ads in most national dailies, in TV and on the web especially emphasising Danske Spil's distribution of charities).

Furthermore, Danske Spil's ads contain key-messages concerning such matters as Danske Spil's responsibility for the gamblers, thereby arguing for the upholding of the limits for internet gambling. In one of the TV-ads it is even underlined that Danske Spil ensures that the money will not end up in the wrong hands, which is of course a not so subtle reference to foreign providers. The advertisement is in fact shot in the basement of a parking house to give the right air of Danske Spil being up against money launderers and lawbreaking criminals.

The construction of the Danish monopoly versus unethical criminals - again with a somewhat subtle reference to foreign providers - is seen in one of Danske Spil's printed ads (see below), in which the industry is compared with the American mafia of the 1930's. Under the headline "Gaming for money is not something you leave to happy amateurs" , the picture text alludes to the mob by saying, that "in the 30's the American mafia was earning more on gambling than on liquor".



Besides the comparison of the gambling industry with the American mafia, the value based image campaign launched by Danske Spil is contradictory. On the one hand, the Danish monopoly has earlier been justified as a source to preventing ludomania or compulsive gambling and on the other hand, it is widely known that Danske Spil has now been for some years one of the biggest advertisers in Denmark. The prevention of ludomania or compulsive gambling does not, therefore, seem the least reliable.

However, the Danish High Court found in its decision in the case Ladbrokes vs. the Ministry of Taxation that the Danish Pools and Lottery Act (tips- og lottoloven) was sufficiently suited to protect the consumers participating in gaming, and furthermore to limit financial crime, since the licensee has the State as its main shareholder, while at the same time being under the administration and supervision of the Minister of Taxation. Nevertheless, the Danish monopoly is still considered illegal by the Commission, and has for four years continued to violate the EC Treaty.