Dutch Court Rules in Favor of Ladbrokes

2 June 2004

After four postponements, the Dutch Court in Arnhem delivered a favorable ruling for Ladbrokes today in the case brought by De Lotto (the Netherlands' sports betting monopoly). The court has rejected De Lotto's attempt to block Ladbrokes from offering online gambling services to Dutch residents.

The battle is not over, however, as the court has asked the Ministry of Justice to present its case and, thus, prove that Dutch policy is consistent with E.U. policy. The court has also blocked a legal procedure to bring the case to the European Court in Brussels.

The verdict is an interlocutory judgment of the procedure on the merits. The case will be continued Sept. 15, 2004, but a final verdict probably won't come until next year. In the meantime, De Lotto may bring in its objections and arguments.

During the same period, the Dutch court will study whether Article 1 of the Dutch Law on Games of Chance is contrary to Article 49 of the EG Treaty.

Further, the court will investigate Point 67 of the Gambelli verdict reached last year by the European Court of Justice. Point 67 reads: "First of all, whilst in Schindler, Läärä and Zenatti the court accepted that restrictions on gaming activities may be justified by imperative requirements in the general interest, such as consumer protection and the prevention of both fraud and incitement to squander on gaming, restrictions based on such grounds and on the need to preserve public order must also be suitable for achieving those objectives, inasmuch as they must serve to limit betting activities in a consistent and systematic manner."

In addition to Ladbrokes' well known arguments related to the free movement of services within the European Union, the U.K.-based betting company used the following new arguments:

  • De Lotto is marketing, advertising and promoting betting products on a large scale, which is not even allowed in the United Kingdom. (De Lotto had an advertising budget in 2002 of approximately 25 million euro.)
  • The Dutch government wishes to generate as much income as possible for its good causes.
  • Ladbrokes is offering long-odds games and bets, which is contrary to some of the De Lotto betting products (such as scratch cards).
  • Only 2 percent of the games of chance offered in the Netherlands in 2002 were offered by Ladbrokes.
  • There is no policy to prevent gambling addiction in the Netherlands.

Concerning the criticism of Ladbrokes, the judge stated that she has to respect the Dutch legislation, but also has to control whether Dutch policy concerning the imposed restrictions of freedom of services curbs the participating in games of chance.

She also referred to Point 75 of the Gambelli decision: "It is for the national court to determine whether the national legislation, taking account of the detailed rules for its application, actually serves the aims which might justify it, and whether the restrictions it imposes are disproportionate in the light of those aims."

Tjeerd Veenstra, director of De Lotto, said he's not displeased with the verdict.

"It is good that a thorough investigation is now done into the matter. We now await the response of the Ministry," Veenstra said. "These proceedings are far from over."

This interlocutory judgment is the third judgment in the long-lasting conflict. In summary proceedings, both the district court and the court of appeals in Arnhem granted judgment in favor of De Lotto. The case is also pending in the Dutch Supreme Court, which should render its decision in several months.

Rob van der Gaast has a background in sports journalism. He worked for over seven years as the head of sports for Dutch National Radio and has developed new concepts for the TV and the gambling industry. Now he operates from Istanbul as an independent gambling research analyst. He specializes in European gambling matters and in privatizations of gambling operators. Rob has contributed to IGN since Jul 09, 2001.