Poland’s controversial proposed new gambling legislation has suffered a setback, raising negative comments from the European Commission to which it was submitted for approval earlier this year.
Provisions involving online gambling and betting have already attracted criticism from the UK and Malta governments
After studying the European Commission’s comments, the European Gambling and Betting Association trade association noted that, whilst the initiative to properly and fairly regulate online gambling was laudable, the current draft contained a wide range of stumbling blocks which could prejudice companies licensed in other EU nations in the pursuit of a Polish licence.
EGBA urged the Polish government to revise the draft to bring it into compliance with the European Treaty.
Provisions which require particular attention include:
* The requirement for licensees to be established in Poland either in the form of a joint stock company or in the form of a limited company with a very high share capital
* The possibility to exclude companies whose shares are quoted on the stock exchanges
* The requirement for online betting companies to install and store their servers in Poland ;
* The obligation for all transactions related to the betting services to be carried out through a Polish bank or in a branch of a foreign bank established in Poland
* The unjustified exclusion of certain games such as online poker
* The significant differences (in terms of financial guarantees and license fees) required for online and offline operators
“Some of these provisions seem to stem from a legitimate wish to regulate and enforce the rules for the online gaming market, but they duplicate requirements already fulfilled in other jurisdictions,” said Sigrid Ligné, Secretary General of EGBA.
“EU licensed and regulated companies can fulfill all necessary requirements on fraud prevention and consumer protection without being necessarily established in Poland. This draft law would leave Polish consumers without a fair, secure and competitive online gaming market,” she added.
In addition, some of the provisions such as the licensing requirements and advertising restrictions also beg the question as to whether the law will be economically attractive for EU licensed operators, Ligné pointed out.
The Polish draft law was notified to the European Commission and Member States on 14 April 2010. The current detailed opinion extends the standstill period until 16 August 2010, during which time Poland cannot adopt its draft legislation.
Poland is required to respond to the Commission’s views, and if it fails to take into account the Commission’s objections, infringement proceedings are an option.
There are also problems with the land-based requirements in the new law. The bill establishes the use of slot machines outside of licensed casinos as illegal and introduces significantly higher taxes on the gambling industry.
Commission spokesman Fabio Pirotta observed that certain provisions may be in conflict with European law.
“The Commission has studied information sent by Polish authorities and the Gambling Bill project. After a deep analysis it has decided to ask for more information in order to investigate whether the bill is compliant with EU law,” he said, declining to elaborate.