Dutch Bankers Association Says No to Blanket Payments Ban

24 November 2008

A Dutch banking interest group is refusing the government's call to block online gambling transactions in the country.

The Netherlands Bankers Association has reiterated its earlier stated position that its members would not cooperate with authorities' requests to block payments for online gambling transactions, according to a recent report in De Telegraaf, the largest daily Dutch newspaper.

The report was confirmed to IGamingNews by Justin Franssen, a gaming lawyer with Van Mens en Wisselink in Amsterdam.

"[Justice Minister Ernst Hirsch Ballin] wants us to become an extension of the justice system, but that is not the role of the banks," Michel Noordermeer, spokesman for the association, told the newspaper.

Association members, therefore, want Mr. Hirsch Ballin, who proposed the payments-blocking legislation, to rethink his position.

"Banks will not comply with a blanket exclusion," Mr. Franssen told IGN by telephone on Monday.

Before the banks the association represents comply with payments-blocking legislation, they want the government to convict an online gambling operator of committing an offense.

In February, Mr. Hirsch Ballin proposed legislation calling for a blacklist of online gambling operators to be circulated among Dutch banks and payment processors.

Although Mr. Hirsch Ballin's proposal is not close to being implemented, Dutch banks have nonetheless refused to comply with the ban.

"If just a list was provided to them, they (Dutch banks) would not cooperate," Mr. Franssen said. "They would only cooperate with the authorities on a case-by-case basis."

However, according to Mr. Franssen, who has clients in the commercial gaming sector, an online gaming operator has never been prosecuted in the Netherlands.

"So there seems to be a stalemate situation between the banks on one hand, and the authorities on the other hand," he said.

The global economic crisis, meanwhile, could have a hand in forcing Dutch banks to block online gambling transactions.

The financial crisis hit European banks hard in early October, but in late September the Netherlands arm of Fortis Bank, the largest bank in the Benelux region, was nationalized by the Dutch government.

Mr. Franssen said the Dutch Socialist Party -- which, with a combined total of 36 seats in the House and Senate, is quickly becoming one of the largest parties in the Dutch Parliament -- has raised questions on whether the government, as an owner of Fortis Bank, can demand that the bank stop processing payments for illegal Internet gambling.

"This question was asked about two weeks ago or so, and we are awaiting an answer from the minister of justice, of course," he said.

Mr. Franssen speculated that the delay may have something to do with the reasoned opinion sent by the European Commission to the Dutch authorities, which holds that the country's sports betting monopoly is non-compliant with European Community law.

Betfair's case against Holland at the Administrative Law Division of the Council of State, and Ladbrokes' case against De Lotto at the Supreme Court, were referred to the European Court of Justice this year and could, too, be holding up a reply from the justice minister.

"All the courts in the Netherlands felt for the last six years that our policy was compliant with European law and now they are not sure about that," Mr. Franssen said. "And that's the reason they sent these cases to the European Court of Justice. So, politically, it (the delay) may very well be connected to these two events."

According to the De Telegraaf report, Mr. Hirsch Ballin told the House Permanent Committee on Justice that in light of the commission's reasoned opinion and reference rulings in the Betfair and Ladbrokes cases, he would be reintroducing legislation before yearend containing a number of new elements.

Mr. Hirsch Ballin said, however, that the legislative process would be delayed.

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