Transcript Document

Advertising for remote gaming
There is no such thing as bad publicity…
There is only « illegal » publicity
Thibault Verbiest
Attorney at the Bars of Paris and Brussels
European Gambling Briefing
25 -26 April 2005
[email protected]
Law of :
• New Technologies • Intellectual Property • Media and Entertainment • Commercial Law •
EU Regulatory Framework
for commercial communications
E-commerce Directive
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Directive privacy & electronic
communications
 Part of Telecom package
All online activities
Notion of “commercial
 Cookies & Spyware
communication”
General obligations
 Imposes OPT-IN regime
Safe harbours &
liability
1. Am I allowed to advertise ?
Two basic principles
 What is illegal offline, should be illegal online
 In most Member states it is only allowed to advertise
IF the gaming activity is legal
 Schindler case
 Bacardi case (TV)
 Consumer protection legislation
2. Is the gaming activity legal ?
 National law: (see annexes)
 General principle:
“the organization of games is illegal unless
authorized”.
 Exceptions : restrictive application of criminal law
find the loophole: P2P, betting exchange & Dutch Betfair cases
 Remote gaming is a de facto cross-border service
Consider international aspects
Malta
 2004 Remote Gaming Regulations
4 licence classes for casino, lotteries, betting, poker and ‘hosting’
 LGA: Three-step application process (5-8 weeks)
 Favourable tax regime under ITC structure
 ITC must provide (gaming) services on cross-border basis
 Advertising (art. 60): allowed within the following limits
 (a) remote gaming promotes or is required for social
acceptance, personal or financial success or the resolution of
any economic, social or personal problems;
 (b) endorsements by well-known personalities that suggest
remote gaming contributed to their success;
 (c) is specifically directed at -18y;
 (d) exceeds the limits of decency.
3. Does European law allow the cross-border
provision and promotion of gaming services?
no : EC Law not applicable
E
C
art.49: freedom to provide services
1)economic activity ?
J
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Restrictions may be imposed, provided that
3) art.49 not discriminatory ?
4) art. 46 justified by the Treaty ?
Yes : 2) goods or service ?
5) necessary and proportionate ?
art.30
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 The Internal Market Strategy for Services
 Remove all remaining barriers in the Internal Market
 Directive 98/48 : e-gaming is an information society service
 E-gaming regulation must be notified (Belgium, Denmark?)
 Electronic commerce Directive : Internal Market clause
 Member States may not impose additional obligations
 Proposal for a Directive on Services in the Internal Market
 Create a real Internal Market – Home Country control
E
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?
ECJ (1): From Gambelli to Placanica and...
 Gambelli & Lindman
Decisions of 6 and 13 November 2003 confirm the
standing jurisprudence, but concrete conditions are
imposed:
 Presence
of a de facto consistent gaming policy;
 Public grounds may not be used to protect market from
competition;
 Country of Origin Principle should be considered;
 Clear and present risks;
 Statistical or other evidence.
ECJ (1): Post-Gambelli case-law
 Post-Gambelli case-law is very diverging, sometimes conflicting
Decisions of Supreme and Constitutional courts in Finland, the
Netherlands, Sweden, Belgium, Germany and Italy
 Netherlands: Summary proceedings vs main proceedings
 Germany:
 BGH: 1 April 2004: questions the legality of German gaming policy in
light of Gambelli
 BVerG: 26 August 2004 – 15 December 2004: Gambelli did change
something
 Constitutional Court: art. 12 case: July 2005?
 Norway: EFTA case
 Italy: -“Bruno Corsi” case –> Placanica case
- Consiglio di Stato 22 February 2005
- EC competition law: Sisal & Lottomatica
 Need for EU clarification?!:
 New jurisprudence of the European Court of Justice: Placanica and....
 European Commission
EU Commission (2) Electronic Commerce Directive
 To promote the development of e-commerce in the Internal Market:
Free provision of information society services and the internal market
clause (Internal market clause – art. 49)
 Article 1.5 excludes “gambling activities which involve wagering a stake
with monetary value in games of chance, including lotteries and betting
transactions.”
Remarks
Scope
Free
& considerations:
of the exclusion: Spain?
games? Promotion of « play for fun » landing pages
Remote
gaming = information society service
Notification: Denmark: article 10 of March 2003 Act?
Review
every two year
First Report on the application of the electronic commerce Directive
July 2005?
EU Commission (2) - e-commerce Directive
First report e-commerce (21 November 2003)
“Online gambling, which is currently outside the scope of the
Directive, is a new area in which action may be required because
of significant Internal Market problems - see for example Case C243/01s of the European Court of Justice (ECJ press release
CJE/03/98), concerning criminal proceedings in Italy against
persons collecting Internet bets on behalf of a bookmaker legally
licensed in the UK. The Commission will examine the need for
and scope of a possible new EU initiative. In addition, the
Commission is examining a number of complaints it has received
concerning cross-border gambling activities. “
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Scope of the exclusion: forum shopping & distortions
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Regulation in new Member States (Malta)
Complaints: Denmark, Sweden, the Netherlands, Belgium,
Germany, Greece, Finland, France, ?
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EU Commission (2) – Service Directive
Proposal for a Directive on Service in the Internal
Market (Jan 2004)
 Create a real Internal Market for services,
including gambling services
 Provision/promotion of Services
 Application of the country of origin principle (Internal
Market Clause)
 Exception for “sensitive areas”, including gambling services
 President Barroso March 2005 statements on
carve out for health and services of public interest
 EP Report of April 2005
4. What about the rights of the consumer-gambler?
 General principle :
In most member states it is not illegal to
participate in ‘illegal’ games >< Poland, Germany
 The Netherlands:
website Department of Justice
 Proposal for a new Service Directive
 ECJ Lindman case (13.11.2003)
Conclusion?
 National authorities easily grant competence
and apply national law
Under national law, most advertising will be
illegal unless license was granted (?)
Skill your creativity – find the loopholes?
 Guerilla
advertising: Beckham ball
 Sponsorship?
 Press coverage?
 Freedom of speech? media and blogs
Sponsorship
Press coverage
No
commercial communication
Freedom
of press (ECHR)
“Schöne
Wetten” case (Ger. Die Welt)
Freedom of Speech - Blog
Freedom of Speech
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Guaranteed by International public law and national
constitutions
Linked to freedom of press (internet?)
USA:
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Article 10: EU Convention for Human Rights
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Tropical Paradise v. Discovery Communications
Casino City case – Ruling 15.02.2005
Limitation by formal Act: precise restriction - Malta
Protect general interest
Necessary in a democratic society
“commercial” speech & access to information?
MEMBER STATE
Regulation
(annexes)
The Netherlands
 The 1964 Act on games of chance :
Promotion of games of chance in the Netherlands without a license is
forbidden.
 Stichting Reclame Code:
Code of Conduct for casino games and gaming machines (RKC)
 Purposes may not be other than a responsible participation and to
incite one’s interest
 May not stress the possibility of winnings
 May not give the impression that gaming is without risk
 May not be directed at vulnerable groups or minors
 May not be displayed at events of venues frequently visited by
minors or other vulnerable groups
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New advertising code for State monopolies 31 March 2005?
The Netherlands - Jurisprudence:
Summary
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proceedings
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Exclusive rights De Lotto and Holland Casino
confirmed
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Supreme Court decision of 18 Feb. 2005
Main proceedings:
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Arnhem: interlocutory judgment of 2.6.2004
Proof of a consistent gaming policy
Foreign operators must adopt online verification systems to block
access to their website from the Dutch territory?
Lindman?
Belgium:
 Casino Games , 1999 Casino Act
Promotion of non-authorized games of chance is an offence, even
when the operation is established outside Belgium (§ 64, 1999 Casino Act)
 Lotteries
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Decision of the Constitutional
Court (March 2004).
National Lottery Act of 19 April 2002:
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Monopoly to the National Lottery
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Modification of 24 December 2002: notification Directive 98/48
Act of 31 December 1851 on lotteries: charity and welfare
 Article 23, 10° of the 1991 Consumer Protection Act
 Publicity that incites the hope to win a product, service or other
advantage by chance is forbidden:
 Exclusion: legally authorized lotteries
No publicity for authorized
games of chance and casino games
France Old regulatory framework
 The regulatory framework
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Games of chance: Act of 12 July 1983
Casino operations: Act of 15 July 1907
Lotteries: Act of 21 May 1836
 Application in an online environment ?
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Casino and notion of “fixed establishment”
Online gaming activities are subject to this legislation, thus a
license is required
Yahoo-case: universal competence
France – Publicity :
 Lotteries: article 4:
Publicity for unauthorized lotteries is forbidden, irrespective
of the media used
 Casino games and games of chance:
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No specific dispositions for publicity
General Regime of the French Criminal Code (§ 121-6,§
121-7)
“He who knowingly contributes to a criminal offence
shall be punished as if he was the author of the offence”
Enforcement on cross-border provision/promotion
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Dellner case (Cass. 22.05.1997)
Trucy Report on the French gaming policy!
Germany
 Federal Criminal Code, StGB: § 284,285 and 287
 Organization of” and “participation in” is considered as
a criminal offence
 Advertising: § 284, 4
 Lotteries: § 287 (no participation)
 Länder (16) :
 Competence to derogate from the general prohibition and
adopt their proper gaming policy & issue license
 Staatsvertrag (State Treaty) of July 2004: article 7: public
offer < demand

Private operators with a former DDR (GDR) Licence
Germany
 A lot of case law and ongoing litigation:
 World Cup 2006?
 BGH: 1 april 2004: questions the legality of German gaming
policy in light of Gambelli (Schöne Wetten)
 BVerG: 26 August 2004 – 15 December 2004:
Gambelli did change something
 Constitutional Court: art. 12 case:
 “landmark decision” by July 2005?
 Urge authorities not to be too restrictive
Italy
 Italian Criminal Code: articles 718-722 :
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The “organization of” and “participation in” games of
chance are criminal offences
Publicity for casino games or games of chance is not
allowed
 Act n° 401 of 13 December 1989 :
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Monopoly for CONI and UNIRE (sports competitions)
If you have a license, you can promote your activities
Final decision in the Gambelli case still pending
Case-law
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Bruno Corsi -> Placanica case
Stanleybet DTC: Consiglio di Stato 22 February 2005
Competition law: Sisal & Lottomatica
Spain
 Untill 1975: the Gaming sector was centralized
 Spanish Constitution of 1978:
The decentralized Comunidades Autónomas (CCAA 19) have an almost
exclusive competence in the field of gaming activities
 Comunidad Autónoma de Aragón: Article 12 of the Act of 28 June 2000
Publicity for games is forbidden, irrespective of the media used
 Government has the competence to adopt a Decree derogating
from this prohibition
 Decree n° 159/2002 of 30 April 2002: commercial lotteries
and games
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 Andalucia: VCBet – Equiniela
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Loterias y Apuestas del Estado (LAE)
Exclusive competence for games that exceed the scope of one CA
 LAE claims the monopoly for remote gaming
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Portugal
 Decree-Law 422 of 2 December 1989 on
casino games
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License is required, 6 requirements
Advertising for gambling or casino games is forbidden
Advertising for venues on which casino games are organized
together with other services (restaurant,
shows, etc.) is allowed
 Advertising Code
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Approved by Decree-law No. 330 of the 23 October 1990
Prohibits advertising of games of chance (§ 21)
Anomar case
United Kingdom –
Current framework
 § 42 of the Gaming Act 1968 and Guidelines
Gaming Board
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Advertising is possible but restricted
Classified advertisement: directed at a certain public
Factual information: name, address, logo and limited details about
gaming facilities
Newspapers and magazines: A4 size
Online: passive website is not covered by the Guidelines, others OPT IN
Television: Independent Television Commission (ITC): Advertising Code
Advertising Standards Authority: CAP Code
 Lotteries
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Lotteries and Amusements Act 1976 and Lotteries Regulations 1993
National Lottery Act 1993
Schindler - Millions2000 case
United Kingdom –
Gambling Act 2005
 The UK an E-gaming Hub?
What is the status? Secondary legislation, Tax & Codes of Conduct
 Advertising is broadly defined, including sponsorship
 Advertising for licensed gaming activities is allowed, particular rules
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Offence to promote or advertise illegal gambling
Territorial application: remote gambling & remote advertising
Cross-border advertising? From and towards UK? EEA?
 Delegation towards the Secretary of State and Gambling Commission
(Advertising Code of Practice - article 23)
Denmark
 National Internet Gaming Strategy, 18 June 2001
Maintain control over the gaming market and protect the monopoly
 ISP’s block access to foreign sites
 Blocking credit card payments, PSP
 Regulate internet gaming
 Rigid monitoring and certification process for licensed operators
 International cooperation
 Ideas or reality?

New Gaming Act (Law no 204 of 25 March 2003)
 Article 10: provision and promotion of foreign games
 Ladbrokes article 49 procedure
 Notification?
 Formal complaint: Commission inquires into Danish restrictions on sports
betting (30 March 2004)
 Commission decides to take further action
Sweden
 1999 Casinos Act
 1994 Lotteries Act, as modified:
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August 2002: online gaming regulated
Lotteries communicated by means of electromagnetic waves (§21)
Publicity, §38:
 “It is not permitted, in commercial operations or otherwise, for the
purpose of profit to promote participation in unlawful lotteries arranged
within the country or in lotteries arranged outside the country”
 “License is required and advertising is subject to the 1995 Marketing
Act and Code of Conducts”
Non-profit associations
Administrative Supreme Court (Regeringsrättens) 26 October 2004
Malta

2004 Remote Gaming Regulations
4 licence classes for casino, lotteries, betting, poker and ‘hosting’

LGA: Three-step application process (5-8 weeks)

Favourable corporate tax regime under ITC structure (4.17%)

ITC must provide (gaming) services on cross-border basis

Advertising (art. 60): allowed within the following limits
 (a) remote gaming promotes or is required for social
acceptance, personal or financial success or the resolution of any economic,
social or personal problems;
 (b) endorsements by well-known personalities that suggest
remote gaming contributed to their success;
 c) is specifically directed at -18y;
 (d) exceeds the limits of decency.
Greece
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Blanket prohibition under Act 3037/2002
encompasses electromechanical and electronic
games (<-> EU complaint)
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Article 4 of Law 2206/1994 forbids the exploitation of
a casino without a license (12 licenses after public tender)

OPAP mainly opposes internet betting on grounds of
Law 2433/1996 which prohibits their operation as
well as their advertising