The gambling and lotteries sector in the EU is going through a period of significant national and pan-European regulatory changes, which has been leading to rapid growth in the sector that is offering challenges as well as opportunities to those involved. With regards to revenue, Italy made more than EUR19.5 billion gross gambling revenue (GGR), the highest in Europe in 2016, followed by the United Kingdom with EUR17.1 billion. Germany (EUR11.1 billion), France (EUR9.9) and Spain (EUR8.4 billion) have also seen increases each year from both online and land-based gambling, including lotteries. In 2020, it is estimated that offline GGR in Europe will reach EUR84.3 billion.
The European Commission
The European Commission supports the modernization of legal frameworks for gambling in individual EU nations, particularly supporting administrative cooperation between regulatory authorities responsible for gambling and lotteries. The European Commission also provides support so that consumers are protected, including minors.
The European Gaming and Betting Association (EGBA)
The EGBA, based in Brussels, is an industry body representing the leading online gaming and betting operators established, licensed and regulated within the EU. EGBA works together with national authorities, EU authorities and other stakeholders to promote a safe and reliable European digital environment for online gambling.
All EGBA members are compulsorily audited on their compliance with gambling measures. EGBA is also one of the founding partners of the EU Athletes program that aims to educate 25,000 players about sports betting integrity, which is now co-funded by the European Commission.
All EGBA members are also members of the European Sports Security Association, ESSA, which drives industry efforts in fighting betting related match-fixing or related corruption in sports and ensures that consumers get a fair betting product. The association has alert and information sharing agreements with numerous leading sports governing bodies including FIFA and the IOC.
The European Lotteries (EL) is the leading European Association for state-owned and state-licensed lotteries and is based in both Lausanne and Brussels. EL promotes the model of lotteries for the benefit of society, offers a platform to share best practices and delivers various services to its members. Whilst lotteries offer small stakes to the masses which generate large sums of money. They can also have negative consequences for individual players, which requires the industry to be regulated and protected, with transparent offers.
Technological developments have presented new opportunities for lotteries but have also allowed new competitors to enter the market both legally and illegally. Some European states do not have a regulatory framework that is fit for purpose when it comes to online gambling space or is limited in their ability to halt illegal operations.
Legislation in the EU
To date, there is no sector-specific EU legislation in the field of gambling and lottery services, with each EU country autonomous in the way they organize gambling and lottery services. The main EU legislation that is relevant to gambling and lotteries in the EU is the Treaty on the Functioning of the European Union (TFEU), as interpreted by the Court of Justice of the EU, which allows for the freedom to provide services or to open a business in another EU country.
Most EU countries allow at least some online games of chance, such as betting, poker or casino games, while others allow all forms of gambling and lotteries. However, these offer a confusion of overlapping jurisdictional oversight, different rules for different games and a maze of rules that need deciphering for each country. Within countries, there are also state laws and sometimes city laws that may apply. In addition, legislation is constantly changing and challenged in courts, creating challenges in compliance by companies.
Systems in use include state-controlled public operators and an increasing number of EU countries with licensing legislation allowing more than one operator to offer services on the market. The Court of Justice of the European Union (CJEU) has ruled on the compliance of national regulatory frameworks with EU law, though this ended in 2017.
Online gambling in the EU
The European market is the largest worldwide market for online gambling, accounting for 47.6 percent of the total revenue. On 7 December 2017, the European Commission decided it will no longer deal with infringement complaints in the gambling sector or promote an EU Single Market in the area of online gambling services. Disputes are now held in national courts, and each country will be responsible for their gaming regulations.
Despite each country being independent in relation to regulation, each follows strict requirements, with every player properly needing to be identified before playing. In addition, the EU continues to draft and redraft its money-laundering framework. The Fifth and Sixth Anti-Money Laundering Directives of 2018 require implementation by EU member states by 10 January 2020 and 3 December 2020, respectively.