Creating the modern European Union was no mean fete – at a minimum it required a loose harmonization of mission and laws between about two dozen nations agreeing to follow a charter originally launched in the 1950s between Belgium, France, Germany, Italy, Luxembourg, and the Netherlands more than quadrupling membership.

For the most part, squabbles and major disagreements have been handled through a process that seems to work, even when nobody ends up getting what they really- their pretty cake to look at and the ability to eat it as well on both sides.

European Commissioner for Justice Didier Reynders recently spoke for the Commission through a written statement, saying that the organization would examine recently passed Maltese legislation and its compatibility with broader written EU law and case law as established through the courts as conflicts in interest have been settled under due process under European Union law.

Yet, today struggles still ensue when nations disagree on mandates and meanings as well as priorities. Recently the Eu Commission has requested more information from Maltese authorities in order to settle a particularly sticky dispute wherein players on both sides have a lot of “skin in the game”.

An inflection point has arisen with the gambling-centric economy of Malta, which has focused and invested heavily in becoming an independent licensing regime for online gambling operators in the EU and elsewhere – and countries such as Germany and Austria that wish to control trade in certain economic sectors within their own birders – ostensibly, for the protection of their own citizens but often, for protection of state-sanctioned monopolies that provide little or no room for online gambling operators who choose not to be licensed by individual national authorities.

In late June, lawmakers in Malta passed the controversial Bill 55, which we reported on earlier. The law protects offshore operators based in Malta from foreign liability, without regard to EU membership.

This means that, if left standing, the law would shield Malta Gaming Authority licensed online casinos and other betting sites from potential liability in cases arising in another member state.

On one extreme it would protect operators from frivolous lawsuits brought by players who bet and lost but think they should be able to recover those losses and on the other end of the spectrum it could leave players in other member-states with no remedy except as provided by the Maltese gambling authority.

A supreme power struggle is underway in the conflict which pits two seemingly opposing concepts of the Union against each other – a state’s right to protect its citizens from harm, albeit through a counter-intuitive monopolization within a member-state’s borders of an important economic metric such as the multi-trillion-euro per year international online gambling industry – and a member state’s right to compete freely anywhere within the union.

The EU Commission was invited into the conflict by three questions asked of it by German MEP Sabine Verheyen. Quite simply, Verheyen asked in one written question after stating Germany’s position that it had a right to protect its citizen from harm by outside actors whether the Maltese law was in accord with EU law and if not, what the Commission planned to “do about it”. Further query related to what sanctions could be imposed. NO reply was given to the question of sanctions.

The next two questions were oddly unrelated, but seem structured to cast the authority in a bad light – whether deserved or not – and not apparently relevant to whether free enterprise trumps de facto monopolization of a certain industry through real or contrived protective measures.

The Commission was also asked whether there were any known links between the government of Malta and the online gambling industry and if there have been any cases of corruption to date.

To the question of links between industry actors and the Maltese government or gambling authority, Verheyen replied: “The Commission has no information on possible links of individual members of the Maltese government to the Maltese gambling industry.”

Working to build Germany’s case against Malta, one of the two founding principles of the EU was invoked when the Commission was queried about infringement proceedings policy referring to Article 258 in the Treaty on the Functioning of the European Union.

However, another interpretation of the core values the Commission will be striving to balance might be:”…promoting peace and security, and respecting fundamental rights and freedoms,” in layman’s terms.

As always, the devil is in the details. Please click the following link to read the Malta Gambling Amndment Bill 55.
https://parlament.mt/media/121901/bill-55-gaming-amendment-bill.pdf

The full answer, as given by Mr. Reynders on Behalf of the European Commission along with supporting documentation, can be found at the following link to parliamentary question E-001722/2023(ASW).

Source: European Commission to scrutinise Malta gaming bill, iGB, July 25, 2023

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Getting the right balance between player freedom and consumer protection arguably remains the holy grail of the gambling industry. I’ve always felt that having what I call a ‘healthy tension’ between regulators and industry is needed to ensure industry continues to raise standards in responsible and safer gambling whilst allowing industry freedoms to innovate and grow sustainably.

This balancing act between sustainable growth and what the economists call the negative externalities of industry affects every industry, not just gambling. As a sector we are still learning about the pathways towards gambling harms and therefore, unsurprisingly, different jurisdictions are exploring different philosophies and approaches to consumer protection.

Here in the UK, player affordability and the single customer view have been key topics in the past two years and approaches and solutions are evolving. Other jurisdictions have taken more one-size-fits-all approaches, with stake limits for online slots (eg Germany), and more player-centric approaches, such as enforcing time and spend limits for each online player session (eg Spain), Striking the balance whilst some jurisdictions have kept monopolies in place (eg Norway), citing consumer protection as the main reason for this approach.

Whilst much attention in recent years has been centred on the iGaming sector, land-based gambling remains a major part of the industry and is embracing these solutions and services. It can be challenging in a land-based environment to innovate, however if the sector is to grow sustainably, it needs to continue to evolve its solutions, particularly leveraging technology further to protect customers.

Regardless of the different approaches, responsible or safer gambling remains a major strategic factor in building regulated and sustainable gambling markets globally. It also highlights the challenges and complexities for multi-national organizations operating in regulated markets as no two jurisdictions are the same.

This complexity, together with the continued pressure to raise standards in consumer protection, has seen considerable investment in safer and responsible gambling capabilities in recent years and there has never before been the range and depth of GAMING professional solutions and services that operators and suppliers can leverage to help ‘raise the bar’.

The ICE conference provides an excellent opportunity for all stakeholders, including legislators, regulators, academics, welfare groups and industry to get together to build strategies for using evidence and technology to strengthen consumer protection. The contributors to this safer gambling supplement are all working hard to develop insights, solutions and services to help the industry better protect players. There are many others and this week is a great opportunity to engage with them and see how you can work together to build a more sustainable industry.

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