Karel’s Legal Blog

Court of Justice of the EU, decision of 6th March 2007, in Joined Cases C 338/04, C 359/04 and C 360/04 (Placanica et al.)

Click here for official Press Release

Italian legislation essentially provides that participation in the organizing of games of chance, including the collection of bets, is subject to possession of a license and a police authorization. Any infringement of that legislation carries criminal penalties of up to three years’ imprisonment.

According to the Court of Justice, national legislation which prohibits the pursuit of the activities of collecting, taking, booking and forwarding offers of bets, in particular bets on sporting events, without a license or a police authorization issued by the Member State concerned, constitutes a restriction on the freedom of establishment and the freedom to provide services, provided for in Articles 43 EC and 49 EC respectively.

The Court ruled that it is for the national courts to determine whether, in so far as national legislation limits the number of operators active in the betting and gaming sector, it genuinely contributes to the objective of preventing the exploitation of activities in that sector for criminal or fraudulent purposes.

The Court is also of the opinion that the articles 43 EC and 49 EC must be interpreted as precluding national legislation, such as that at issue in the main proceedings, which excludes – and, moreover, continues to exclude – from the betting and gaming sector operators in the form of companies whose shares are quoted on the regulated markets.

Finally, the Court ruled that the articles 43 EC and 49 EC must be interpreted as precluding national legislation, such as that at issue in the main proceedings, which imposes a criminal penalty on persons such as the defendants in the main proceedings for pursuing the organized activity of collecting bets without a license or a police authorization as required under the national legislation, where those persons were unable to obtain licenses or authorizations because that Member State, in violation of Community law, refused to grant licenses or authorizations to such persons.

Not only the gaming (gambling, betting) laws of Italy are in violation with European law, so are the laws of The Netherlands. The European Commission urged The Netherlands to amend its legislation to legalize internet gambling, but up to now the Dutch government refuses to do so. It only allows state-organized organizations to offer such services and thus does not allow any competition. The Dutch government should open its borders. The question is not if but when those monopolies will be broken. Today’s decision is a step further to the liberalization of the EU gaming markets.

Karel Frielink
Curacao-based Attorney (lawyer) / Partner

Filed under: legal by Karel.Frielink