Denmark Considers Prohibitive Tactics

5 March 2003

Lawmakers in Denmark are considering new rules that would limit online gaming to protect the state-run betting company Tipstjeneste, which handles all non-Internet gaming in the country.

The Copenhagen Post reported on Feb. 27 that a new "tips law" is receiving much cross-party political support. The law would make it illegal for foreign bookmakers to advertise in Denmark and to employ Danish workers.

While the proposal is reportedly getting support from many of Denmark's politicians, Tax Minister Sven Erik Hovmand believes it could break European Union laws regarding restrictive practice.

Article 49 of European Union law allows companies the freedom to provide their services across the E.U. It is the same rule that is being used by British bookmaker Ladbrokes as it looks to the E.U. court to overturn a Dutch ruling that mandates the company should block Dutch bettors from wagering on its site.

Tipstjeneste has annual turnover of 6 billion Danish kroner ($8.9 million). Proponents of protecting its monopoly say that since the company donates much of its revenue to sports and cultural projects, it behooves Denmark to leave the monopoly in place.

One Internet bookmaker that would be affected by the tips law is The U.K. company does extensive advertising and marketing in Denmark, said its executive vice chairman, Mark Blandford. Sportingbet also employs one Dane, Kresten Buch, who provides local Danish sporting information to the site.

If the law is passed, Blandford said he would have make other arrangements as far as Buch is concerned. He also said that regardless of any law that is passed in Denmark, his site will continue to target Danish bettors. He said the location of the bet is determined based on where the gaming servers are located and not the location of the individual bettor.

"We are not conducting business in Denmark. The transaction is taking place in the U.K. where we are legally licensed to conduct such business," he said.

Justin Franssen, a lawyer in the Netherlands who is involved in a case regarding Casino Lux offering online bets to Dutch citizens, said E.U. courts have set a precedent for gambling monopolies.

"There have been three different cases and each one the courts ruled in favor of the gaming monopolies," he said.

However, Franssen said, E.U. law does grant leeway for countries in terms of their gambling regulations. He said he is not sure how the Danish situation will end.

"I don’t have a crystal ball and no one really knows what will happen but this could bring about change in the law," he said.

Emily Swoboda is the senior staff writer at IGamingNews. She lives in St. Louis, Mo.