The European Court of Justice (CJEU) brought its hammer down hard on Hungary this week, determining that their recently proposed requirement that a venue be a licensed brick and mortar facility before being permitted to offer online gambling services was “a clear violation of EU law”. The case under review, which was certainly under the purview of existing EU legislation, concerned the licensed regulator Sporting Odds, who had suffered both fines and a temporary blocking by ISPs over this very issue.
The CJEU also ruled that Hungary’s current gambling legislation was “not in line with the EU freedom to provide services” and, in fact, went so far as to issue a prohibition of enforcement in relation to this legislation. The court also made explicit reference to the Hungarian licensing system itself, which it indicated allows state-owned services to monopolise some types of gambling services while putting in place a licensing system for other offerings. The CJEU commented that it is the responsibility of the Hungarian court to determine whether this setup “attains public policy objectives in a consistent and systematic manner.”
The European Gaming and Betting Association (EGBA) issued a statement shortly thereafter to the effect that the association “… welcomes the ruling which reinforces the CJEU’s previous judgment against Hungarian licensing regulations and is a significant step in providing further legal clarity to online gambling regulation in Europe.” A similar preliminary ruling was previously made in favour of Unibet, in reference to actions taken by the Hungarian Tax Authority.
Following the EC’s decision last year not to intervene in national matters concerning gambling, there has been some concern across the continent that this might enable national jurisdictions to impose restrictions that violate EU law, perhaps even allowing them to do so without sufficient oversight in place to prevent it. This recent decision by the CJEU underlines the fact that there are still limits to what national jurisprudence can decide to do and say regarding gambling matters.
The Secretary General of the EGBA, Maarten Haijer, emphasized this point in his recent published statement on the matter: “We are pleased that the CJEU has concluded this (issue) once and for all. Restrictive requirements like these, that discriminate against operators who are entitled to provide their services in a Member State, have no place in the EU. It is clear that, even if Member States are to an extent free to regulate gambling according to their policy objectives, the overall framework is set by EU law.”
