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Progress and uncertainties on the online gambling regime in The Netherlands

GamingLawPills No. 30 brings news on the development of the routes towards the setting up of online gambling regulations in The Netherlands.

The position of EGBA on online gambling regulation in the Netherlands

The Netherlands is currently one of the few European countries which do not regulate online gambling. While, discussions and ongoing works are in place at a political level to modernise the Dutch gambling framework, the European Gaming and Betting Association (“EGBA”) issued its support for Minister Sander Dekker’s proposal.

The EGBA welcomed a regulation which permits online players to gamble in a regulated environment and at the same time does not deprive the Dutch state of valuable tax revenue. Moreover, the EGBA believes that the new Dutch gambling law should be based on robust consumer guidelines following the guidelines issued by the European Commission on how EU member countries can ensure a consistent, high level of consumer protection for their online gamblers.

Despite the current lack of regulation, researches showed that over 10% of the total population participated in online gambling and the the Dutch online market was worth €592m in 2018. Therefore, as stated by the EGBA Secretary General: “a licensing model which facilitates this consumer choice will create a better functioning market with players who are properly protected and valuable tax receipts for the Dutch state.“.

The last “busy” weeks of the Dutch online gambling licensing regime

In the meantime, as pointed out by our Dutch DLA Piper gambling colleague, Richard van Schaik, on All-in blog, on the 5th of February 2019 the Dutch Remote Gambling Act (RGA) reached the latest phase of the legislative process, leaving though considerable room for uncertainties.

The plenary session of the Dutch Senate was suspended, as a majority of the Senate requested more clarity from the Minister of Legal Protection with respect to several questions that were not answered satisfactorily by the Minister and the last part of the plenary session will be continued on Tuesday 12 February 2019.

The Minister of Legal Protection then provided written answers on the outstanding points clarifying the following points:

Which “illegal” gambling operators will be subject to a cooling-off period?

The starting point of the Minister is clear: illegal gambling operators that will continue to actively target the Dutch gambling market and recruiting players from the Dutch market, must be avoided. These are operators that e.g. use payment instruments such as iDeal, advertising aimed at the Netherlands or use a Dutch domain name. These gambling operators are referred to by the Minister as “cowboys”, and it seems that these cowboys will – in most cases – not be eligible for a license.

With respect to the operators that were active in the offering of illegal games of chance in the past, the Minister mentions that it can take away the doubt about their reliability during a consecutive period prior to the license application showing good behaviour (the “cooling-off period”). During this cooling-off period, the KSA can assess the behaviour of the applicant according to its prioritization criteria.

Therefore, it is safe to say that such applicants are eligible for a license (provided that they meet all the criteria), but will need to undergo a cooling-off period during which they need to demonstrate good behaviour.

How gambling advertising will be regulated in The Netherlands?

The Minister mentioned that the strict gambling advertising regime for online games of chance set out in the draft RGA applies regardless of the medium, i.e. also for online advertising and advertising via social media.

Also, advertising for online games of chance may not be made in games or on websites where games are offered. The deployment of individual athletes in advertisements is also forbidden, nor may product placement take place.

For that reason, license holders are not allowed to use influencers or vloggers as, according to the Minister, the followers are predominantly minors or young adults. Specifically for television, no advertising is allowed between 6 o’clock in the morning and 7 o’clock in the evening. Furthermore, the Minister stresses out that the KSA will actively enforce the advertising requirements and that he shall, together with the KSA, closely follow developments in advertising immediately after the implementation of the RGA.

Which measures against illegal gambling websites?

The Minister mentioned that when it comes to enforcement of the RGA, administrative sanctioning is the starting point. In case of aggravating circumstances, violation of the KSA can be sanctioned on the basis of criminal law. As an ultimum remedium, Article 54a of the Dutch criminal Code can be used to block illegal websites.

However, as there are sufficient instruments for the KSA on the basis of the RGA to block websites, the criminal enforcement measures will in practice not often appear. The administrative enforcement powers of the KSA are considerably expanded under the RGA. For example, the KSA can give binding instructions to payment service providers, marketing companies and other facility service providers, in order to e.g. directly block payment services to illegal providers.

During the plenary session of the Senate of the 12th of February 2019, it will become clear whether the Senate is satisfied with the answers given by the Minister and whether this leads to an adoption of the RGA.

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Vincenzo Giuffré

Trainee Lawyer at DLA Piper IPT Italy, Milan| Graduated Student at Bocconi University: Major Business Law School | Exchange Program at University of Minnesota - W. Mondale Law School | Visiting Student at National University of Singapore (NUS)

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