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Top 5 takeaways from DLA Piper Gambling event before ICE Gaming 2020

Relevant insights emerged from the debate which show markets with uncertain regimes

The DLA Piper Gambling event 2020 was an interesting brainstorming session that gave an overview of 7 markets, and here are my top 5 takeaways.

On the 3rd of February 2020, we arranged the fourth edition of the DLA Piper Gambling event where we involved our colleagues Paula González de Castejón from Spain, Christopher Büller from Sweden, Michael Malloy from Russia and Laura Ford from the UK. Also, Christoph Engelmann from DLA Piper Germany and Richard van Schaik from DLA Piper The Netherlands chaired led an interesting debate on the future of gambling rules in their countries with our special guests Trevor De Giorgio from Greentube and Francesco Rodano from Playtech.

Here are my very personal top 5 takeaways from the event:

1. The Swedish gambling market is open and growing, but regulatory uncertainties generate risks

The Swedish gambling license regime has been in place for a year so far and 68 betting licenses were awarded. The application window is always open, but new entrants in the market are facing deeper scrutiny than first comers since the position of the gambling authority has been evolving over time.

Swedish gambling rules set out only general principles, without giving much guidance to operators on how to apply with them. Such uncertainty led to sanctions against operators that are now challenging them.

Hopefully, the market will rapidly evolve and previous decisions of the regulator will become valid guidelines for operators.

2. Russia is a market full of potentials, but it requires a very peculiar approach

Online gambling is now allowed in Russia, while traditionally online sports betting has been allowed but requires a bookmaker license of a betting shop, even though during recent months a more liberal approach was in place.

Stringent limitations are in place in terms of location of servers, payment blocking and filtering of unlicensed websites. Also, betting advertising is subject to strict restrictions in terms of who can advertise, where and when can advertise and what type of advertising content can be published.

The Russian market requires a tailored approach but is a considerable opportunity for operators.

3. Spanish gambling advertising rules will hopefully not follow the Italian model

The Spanish gambling market has been considerably growing during the last years. New gambling licenses are not available at the moment, but hopefully, the application window will be re-opened.

A major threat to the market is represented by the potential new gambling advertising regime. Spain already has a gambling advertising code of conduct that is observed by all the operators. However, if the industry is unable to adopt a regime that is acceptable for public opinion, the government might introduce major restrictions.

Operators should collaborate to agree on the new gambling advertising regime since it is in the interest of the whole market.

4. Brexit requires the reorganization of groups and might limit enforcement against unlicensed operators

Only a few days occurred after Brexit, and its regime is still uncertain. Italian and Spanish gambling rules require that the license holder is based in the European Economic Area, but the terms of the transition agreement do not govern such an aspect.

At the same time, Brexit might limit the ability of the UK government to take enforcement actions and to issue fines against unlicensed operators. Since governmental authorities will be busy in setting the new rules for the regime in place after the 31st of December 2020, it is unlikely that they will introduce in the short term rules addressing the issue.

5. Germany and The Netherlands are the markets to watch but something has to change

The sports betting licensing regime is now in place in Germany and it is possible to apply for a license, and online casino rules for virtual slots and poker are expected by March 2020.

The opening of the application window for Dutch gambling licenses was postponed to mid-2021, but 120 companies already showed interest and 90 operators will obtain a license. However, if an operator was fined for the illegal offering of games in The Netherlands, it will face a 2 year “cooling off period” in which it cannot apply for a license.

Major concerns arise in Germany due to the high taxes that could not be sustainable for operators and limitations on the types of casino games that will be allowed that will replicate offline casino slots. Likewise, the Dutch gambling license regime still does not define the applicable technical requirements which represent a substantial issue for investors in the market.

We hope it was an interesting event and we look forward to seeing all the attendees again next year!

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Giulio Coraggio

I am the head of the Italian Technology sector and the global head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our clients' success.

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