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Policy
- Framework Services Directive
- Electronic Commerce Directive
- Draft Audiovisual Media Services Directive
- Infringement proceedings
- European Court of Justice Cases
- Gambling studies
- Smoking bans
EUBINGO tries to stay abreast of EU policy developments that may have an impact on the bingo sector. Among the policies of relevance to EUBINGO are:
A Framework Services Driective was first proposed by the European Commission on 13 January 2004, in order to liberalise services in the Internal Market in accordance with the freedom of establishment, set out in Article 43, and the freedom to provide cross border services, set out in Article 49 of the Treaty establishing the European Community. The draft proposal set out provisions for both a transitional derogation from the 'country of origin' principle for gambling and to assess the possibility of presenting a proposal for harmonisation instrument on gambling one year after the implementation of the Directive.
The proposed Directive is subject to the co-decision decision-making procedure: Legislative proposals are subject to two readings by the European Parliament (EP) and the Council, in which they can amend the Commission Proposal.
- The EP votes on a report amending the Commission Proposal in Plenary Session at first reading, which will be then submitted to the Council.
- The Council gives its view on the Commission’s proposal and the Parliament’s report in the form of a Common Position.
- The Common Position then returns to the EP where a second report is prepared and voted on.
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The Council has one last chance to make further amendments. If, at this stage, an agreement between the Council and the Parliament has not been reached, the piece of legislation will be put before a conciliation committee, composed of equal numbers of the Council and the EP representatives, in order to find a compromise. If the compromise is reached, the text is sent once again to Parliament and the Council so that they can finally adopt it as law. If not, the Directive falls and the Commission may or may not make a new proposal.
European Parliament vote at first reading: exclusion of gambling
MEP Evelyne Gebhardt (PSE, Germany) drafted the report amending the Commission Proposal for a draft Framework Services Dirctive for the EP Committee on Internal Market and Consumer Protection (IMCO). The report excluded gambling from the scope of the Directive but added the word “casino” to the definition of gambling, as laid down in the e-commerce Directive of 2000. The EP Plenary session voted in favour of her report on 16 February 2007, and as such gambling continues to be excluded from the scope of the draft Directive.
European Commission’s amended proposal
On 4 April 2007, the Commission presented its amended proposal for a Framework Service Directive. In its redraft, the European Commission endorsed the European Parliament’s decision to completely exclude gambling from the scope of the Directive. The Commission however rephrased the Directive’s definition of gambling in the article 2.2(ce) by adding specifically "gambling in casinos" as an example of what does not fall under the scope of the draft Framework Services Directive.
Adoption of the Common Position in Council
At the Competitiveness Council on 29/30 May 2007, the Austrian Presidency secured a political agreement on the draft Framework Services Directive (FSD). The political agreement of the Council continues to exclude gambling from the directive and does not alter the definition of gambling as worded in the Commission's amended proposal. The Council Common Position will be formally adopted in a forthcoming meeting and then forwarded to the European Parliament for a second reading. Article 2.2.ce reads "This Directive shall not apply to the following activities: (...) gambling activities which involve wagering a stake with pecuniary value in games of chance, including lotteries, gambling in casinos and betting Transactions".
2nd reading in the European Parliament
Rapporteur Evelyn Gebhardt (PSE,Germany) revealed her 11 amendments to the Council's Common Position on the draft Framework Services Directive in the IMCO Committee on 13 September 2006. IMCO held two meetings on the draft Framework Services Directive which resulted in the adoption of the Council's common position, without changes.
On 15 November 2006, the EP Plenary session voted on the draft Framework Services Directive, resulting in the adoption of the Council's Common Position in its entirety, with gambling services remaining excluded from the scope of the Directive.
Final Adoption in Council
On 11 December 2006 the Council adopted the draft Framework Services Directive without discussion at the Competitiveness Council meeting. The final text excludes gambling services from its scope of application and was published in the Official Journal of the EU on 27 December 2006.
Current developments
The Framework Services Directive is currently being implemented into national legislation by all Member States who have until December 2009 to transpose the provisions of the Directive into their national legislation. Gambling services do not fall under the scope of this Directive. Timeframe:
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13 January 2004
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16 February 2006 | 4 April 2006 | 22 April 2006 | 29 May 2006 |
| Commission’s initial proposal published | European Parliament’s first report adopted at first reading | Commission’s amended proposal published | Competitiveness ministers discuss the amended proposal | Council Adopt a Common Position |
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September 2006
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15 November 2006 | 11 December 2006 | 27 December 2006 |
| The draft Framework Services Directive went through second reading in the European Parliament | The European Parliament adopted the Council's Common Position with no amendment | The Council finally adopted the draft Framework Services Directive | The Framework Services Directive was officially published on the Official Journal of the EU |
On 8 June 2000, the Electronic Commerce Directive (2000/31/EC), which deals with certain legal aspects of information society services in the Internal Market, was adopted. The e-Commerce Directive was implemented into Memeber State national law by 17 January 2002. The Directive refers to gambling services as "games of chance, lotteries and betting transactions, which involve wagering a stake with monetary value".
The Framework Services Directive, adopted in December 2006, introduced a slightly different definition of gambling services, whereby they are defined as "gambling activities which involve wagering a stake with pecuniary value in games of chance, including lotteries, gambling in casinos and betting transactions". This addition is not only linguistically incorrect from a legal point of view (casinos are not gambling services but rather the establishments / premises where gambling services are provided) but it may also lead to confusion as to what falls under the definition of gambling and what does not. However, the European Commission has confirmed that all gambling services (within and outside casinos) are excluded from the scope of the Directive.
Article 21 of Directive 2000/31/EC provides that in 2003 and thereafter every two years, the Commission shall submit to the European Parliament, the Council and the Economic and Social Committee a report on the application of the Directive accompanied, where necessary, by proposals for adapting it to legal, technical and economic developments in the field of information society services. The Commission's report of 21 November 2003 concluded that the Internal Market objectives of the Directive have been met and that it has provided a sound legal framework for information society services in the Internal Market. It has also led to modernisation of existing national legislation, for example in contract law, to ensure the full validity of online transactions.
On 24 October 2005, the Commission established an expert group on electronic commerce. The objectives of this group are as follows:
The Members of the Expert Group are, in principle, contact points appointed in line with Article 19 (2) of the e-commerce directive. Since its establishment, the expert group has met three times: 17 November 2005, 6 April 2006 and 20 February 2007.
What next?
In September 2007, the expert group is expected to publish a study on the liability regime for information society and intermediaries. Furthermore, a second report on the application of the E-Commerce Directive is due in June 2008.
Draft Audiovisual Media Services Directive
The European Commission released a revised version of the draft Audiovisual Media Services (AVMS) Directive on 9 March 2007. The revised proposal takes into account the EP's first reading report and the ongoing Council deliberations. The revised text continues to exclude gambling services from the scope of the Directive. The May 2007 scheduled Council decision on a Common Position on AVMS has been postponed until the end of summer.
In July 2005, the European Commission discussed the possibility of taking legal action against seven Member States for protecting their gambling markets. Commissioner Charlie McCreevy has always been pushing for action and in March 2006 the European Commission decided to officially question seven Member States (Denmark, Finland, Germany, Hungary, Italy, the Netherlands and Sweden) on their national legislation restricting the supply of sports betting services. Those Member States received a letter of formal notice (the first step in an infringement procedure under Article 226 of the EC Treaty) and were given two months to respond. The Commission examined their responses with a view to establish whether those restrictions in place were compatible with Article 49 of the EC Treaty on the free provision of services in the Internal Market. In addition, the Commission sent letters of formal notice to Austria, France and Italy, regarding national legislation restricting the supply of gambling services in October 2006.
On 14 November 2006, Commissioner McCreevy responded to the Oral Question on Gambling asked by Arlene McCarthy, Chair of the Committee on Internal Market and Consumer Protection, during the Plenary session in Strasbourg, stating that EU-wide harmonisation of legislation regulating gambling at present was not likely.
In June 2007, while conducting its second quarterly inventory of infringement procedures, the Commission formally requested France and Sweden to amend their laws following consideration of their replies to letters of formal notice sent in April and October 2006 in the form of "reasoned opinions".
Aditionally, the European Commission sent a reasoned opinion to the Greek authorities for failing to take the necessary measures to comply with the judgments of the ECJ. The ECJ, in case C-65/05 of 26 October 2006, ruled that the Greek laws banning the installation and operation of all gaming machines violate a number of Internal Market principles. The ECJ also ruled that the Greek ban of all electrical, electromechanical and electronic games, including all computer games, on all public and private premises apart from casinos violates the principles of free movement of goods, freedom of establishment as well as freedom to provide services (Articles 28, 30, 43 and 49 of the EC Treaty).
What next?
If there is no satisfactory reply to the reasoned opinions sent to France and Sweden, the Commission may refer the matter to the ECJ. Greece also has two months in which to respond to the letter of formal notice.
European Court of Justice Cases
Femara, Facomare v. Administracion General del Estado Español(27/06/97)
This case relates to the interpretation of article 33 of the Sixth Council Directive 77/388/EEC of May 1977 on the harmonization of Member State laws relating to turnover taxes, aroused in proceedings between Careda SA and the Spanish Ministry for the Economy and finance concerning an assessment under the tax heading of the supplementary charge to the fiscal levy on games of chance, betting and gambling, laid down by a Spanish Law Careda wanted to be annulled.
The ECJ held that for a national tax to be characterized as a turnover tax, it is not necessary for the relevant national legislation expressly to provide that it may be passed on to consumers, neither for the passing on of the tax to the consumer to be recorded in an invoice or any other document serving as an invoice. It is for the National Court to establish whether a tax can be considered as a turnover tax, knowing that it will generally be the case if the tax is proportional to the price of the services, if it is charged at each stage of the production and distribution process and if it is imposed on the added value services.
Questore di Verona v. Zenatti (20/05/06)
This judgement on the interpretation of the provisions of the EC Treaty concerning the freedom to provided services and their compatibility with national legislation which, subject to exceptions, prohibits the taking of bets and reserves to certain bodies the right to organise the taking of such bets as are authorised, was raised in proceeding between the Police prosecuting authority of Verona and Mr Zenatti concerning the prohibition imposed on the latter form acting as an intermediary in Italy for a company established in the UK specializing in the taking of bets on sporting event.
The ECJ held that national legislation which reserves for certain bodies the right to take bets on sporting events and which thus prevents operators in other Member States from taking bets, directly or indirectly, constitutes an obstacle to the freedom to provide services even if it applies without distinction. However, in so far as such legislation does not entail discrimination on grounds of nationality, it can be justified where its objectives are to protect consumers and to maintain order in society. The determination of the scope of the protection which a Member State intends to guarantee in its territory in relation to lotteries and other forms of gambling falls within the margin of appreciation enjoyed by the national authorities. Each Member State can deal with the question in a different way, and the solution can only be assessed in the light ot the objectives pursued by the national authorities of the Member State and the level of protection which it intends to insure.
Laara (21/09/99)
This judgement, on the interpretation of the Schindler's case and of articles 28, 30, 46, 49 50 of the EC Treaty, was raised in proceeding between Mr Laara (the head of a Finnish Company) and the Finnish State concerning the operation of slot machines in Finland.
The ECJ ruled that national legislation which grants to a single public body exclusive rights to operate slot machines in the national territory, and which thus directly or indirectly prevents operators in other Member States from making slot machines available to the public with a view to their use in return for payment, constitutes an impediment to the freedom to provide services, even if it applies without distinction. However, in so far as such legislation involves no discrimination on grounds of nationality, that impediment may be justified on grounds relating to protection of consumers and to maintain order in society. The determination of the scope of the protection which a Member State intends to guarantee in its territory in relation to slot machines, lotteries and other forms of gambling falls within the scope of competences enjoyed by the national authorities. Each Member State can deal with the question in a different way, and the solution can only be assessed in the light of the objectives pursued by the national authorities of the Member State and the level of protection which it intends to insure.
In the 2004 Gambelli ruling, the ECJ declared that the Italian government could not on the one hand restrict foreign betting companies while promoting national gambling on the other. However the final judgement sent back to the Italian court ruled in favour of Italy's restrictions thus confirming that Member States are allowed to restrict betting services in the name of social protection or to limit criminal activity associated with gambling.
Linneweber (16/04/05)
The European Court of Justice Advocate-General Damaso Ruiz-Jarabo gave his opinion on the Placanica case on 16 May 2006 defining the Italian regime discriminatory and inconsistent with the EC Treaties, with respect to the allocation of licenses. According to him the 2004 Gambelli ruling did not provide a complete examination of the impact of the EC Treaty fundamental freedoms on the gambling sector.
On 6 March 2007, the European Court of Justice (ECJ) issued its ruling on the Placanica case (C-338/04). The ECJ found the Italian sports betting licensing regime discriminatory and in breach of articles 43 and 49 of the EC Treaty on the freedom of establishement and free provision of services.
EFTA Surveillance Authority v. Kingdom of Norway (Norsk Tipping Case) (14/03/07)
On 14 March 2007, the European Free Trade Association (EFTA) Court announced its ruling on the "Norsk Tipping" case relating to Norwegian legislation transferring the operation of gaming machines to a state-owned monopoly on the ground that a state controlled operator could tackle problem gambling more efficiently. The court stated that the Norwegian State-run monopoly is a legitimate and appropriate way to contain and control gambling dependency. Given the similarities between EFTA and the EU market rules, this judgement could have an impact on other cases currently before the courts in the EU.
The EFTA Surveillance Authority filed a complaint against the Kingdom of Norway before the EFTA Court for breach of the freedom of establishment and provision of services. The EFTA court, however, rejected the Surveillance Authority's assessment after considering the specific nature of the aim, saying: "It is reasonable to assume that a monopoly operator in the field of gaming machines subject to effective control by the competent public authorities will tend to accommodate legitimate concerns of fighting gambling addiction better than a commercial operator. (...) Furthermore, it is plausible to assume that in principle the State can more easily control and direct a wholly State-owned operator than private operators". Furthermore, the Norwegian system has, according to the Court, already shown its worth on the ground and demonstrated its effectiveness in the fight against gambling addiction.
Ladbrokes v. the Government of Norway (30/05/07)
On 30 May 2007, the Court of the European Free Trade Association (EFTA) gave its ruling on case E-3/06 on the restriction to the freedom of establishment and the freedom to provide services in the European Economic Area (EEA).
EFTA is a distinct entity from the EU. It includes Iceland, Lichtenstein, Norway, and Switzerland and was established in 1960 as an alternative for European states who did not wish to join the EU. In 1992, the EFTA members (except for Switzerland) and the EU signed an agreement establishing the EEA to allow EFTA countries to participate in the European Single Market without having to join the EU. The EEA is based on four "freedoms": the free movement of goods, persons, services, and capital among the EEA countries. The countries enjoy free trade with EU Member States, but have little influence on the decision-making process in Brussels.
Norway had been accused of breaching European Internal Market rules (particularly Article 43 and 49 of the EC Treaty on freedom of establishment and free provision of services in the Internal Market) by blocking UK bookmaker Ladbrokes from setting up gambling operations. On 30 May 2007, The EFTA Court in Luxembourg ruled that "a licence may still be required in view of possible differences in the level of protection throughout the EEA". The EFTA ruling follows a judgment by the same court in March 2007, equally on a Norwegian ("Norsk Tipping") case, in which the court explicitly upheld the country's monopoly system on gaming machines.
The EFTA court ruled that where the State holds a monopoly to offer gambling services, "which channels its profits to cultural and sports purposes", "national authorities have the right to ban the provision and marketing of games of chance from abroad, no matter whether or not these are lawful in their State of origin". Norway claimed that domestic gambling companies use their money for "socially beneficial purposes"; however the court rejected such arguments as they "do not constitute the real justification for legislation". The court warned that "the legislation must not go beyond what is necessary in order to achieve the aims in question" - fighting gambling addiction and maintaining public order.
Further to a call for tender, the European Commission awarded to the Swiss Institute of Comparative Law (SICL) the Study on gambling in the EU Internal Market in February 2005. On the basis of the study the European Commission may decide whether it should take action in the field of gambling. The Swiss Institute, which had the contractual obligation to consult stakeholders, sent a questionnaire to all interested parties. The original release date of the study was September 2005 and stakeholders were to be invited to a hearing on 12 September to have a last chance to comment on the study before the study is finalised. Due to the difficulty to get the information from some gambling sectors and the sensitivity of such a subject, the study release has been delayed.
The draft version of the study was released on 24 April 2006 and the stakeholders' meeting took place on 8 May 2006, in Geneva. In addition the Swiss Institute raised the controversy in subcontracting the study to the Gaming Studies Research Centre of the University of Salford which is funded one of the UK's largest bookmakers. This led French socialist MEP Pervenche Berès to question the partiality of the study in a written Question and French conservative MEP Jacques Toubon in an oral question to Internal Market and Services Commissioner Charlie McCreevy.
EUbingo members contributed to the study with their own comments on figures and definitions provided for the gaming and amusement sector, which were finally included in the annexes of the final draft of the study. The Swiss Institute sent the final text to the Commission in June 2006. The Commission finally published the 'study on gambling in the Internal Market' on its website on 12 October 2006. It is still unclear what the Commission intends to do with the study as Commissioner McCreevy stated in November 2006 that any attempt of harmonisation of gambling services in the Internal Market is very unlikely to occur due to Member State opposition.
Study on Gambling in the Internal Market (October 2006)
On 30 January 2007, the European Commission adopted a Green Paper, entitled "Towards a Europe free from tobacco smoke: policy options at EU level", in order to launch a broad public consultation on the best way to promote smoke-free environments in the EU. The paper considers the health as well as the economic burdens associated with passive smoking, public support for smoking bans, and the measures taken so far at national and EU level.
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