EU Court Denies Portuguese Anomar

12 September 2003

One of the two pending European Union Court of Justice (EUJ) gambling cases (the Anomar and Gambelli cases) was ruled upon this week.

In the case C-6/01, Associaçno Nacional de Operadores de Máquinas Recreativas (Anomar) and Others versus the Portuguese State, the judgment was: The Portuguese legislation that restricts games of chance to casinos is not contrary to community rules on freedom to provide services. Community law does not preclude national legislation that prohibits the exploitation and operation of certain games of chance or gambling other than in casinos situated within authorized areas.

The verdict was in accordance with the opinion of the Advocate General, whose task is, acting with complete independence, to propose to the court a legal solution to the cases before it and is not binding on the Court of Justice. The court follows the Advocate General in roughly 80 percent of EUJ cases.

Portuguese law reserves the exploitation and operation of games of chance or gambling to the state and authorizes such exploitation and operation only in areas provided for by law, that is to say in casinos which hold a public license.

Associaçno Nacional de Operadores de Máquinas Recreativas (Anomar), an association of Portuguese gaming machine operators, and eight Portuguese companies that pursue the same activities, brought an action before the Portuguese courts against the Portuguese state for a finding that they were entitled to operate slot machines outside the areas set aside by law for gambling.

The Portuguese court has made a reference to the Court of Justice of the European Communities as to the compatibility of the Portuguese provisions with community law.

First, the court describes the activity of operation of gaming machines as a "service" within the meaning of the EC Treaty.

Next, it recalls that national legislation may fall within the ambit of Article 59 of the Treaty, even if it is applicable without distinction, when it is liable to prohibit or otherwise impede the activities of a provider of services established in another Member State where it lawfully provides similar services. The court found that this is the case with the Portuguese provisions, which restrict the operation of games of chance and gambling solely to casinos located within permanent or temporary gaming areas established under Portuguese law.

In certain circumstances, the EC Treaty permits restrictions to the freedom to provide services. Where restrictive measures that apply without making any distinction as to nationality are in issue-­as in the present case--they may be justified by overriding reasons relating to the public interest, provided that they are proportionate to the objectives pursued.

Seeking to maintain fairness in games of chance and the possibility of deriving some benefit for the public sector are objectives which, taken as a whole, pursue the protection of consumers and the maintenance of order in society. They have previously been described by the court as justifying interference with the freedom to provide services and proportionate with regard to the objectives pursued by the national provisions.

The court points out that other member states' legislation on betting and gaming that is less restrictive than the Portuguese provisions has no bearing on the compatibility of the Portuguese legislation with community law.

Finally, the court recalls that the choice of actual implementing procedure, such as the decision to make the exploitation and operation of games of chance subject to entering into an administrative licensing agreement with the state on the basis of a public tendering procedure, falls within the discretion of the national authorities.

The Gambelli Case C-243/01

In the criminal proceedings against Piergiorgio Gambelli and Others, regarding the Italian prohibition on the taking of cross-border bets as contrary to the E.U. freedom to provide services, the Advocate General took the view that the data transfer centers are not branches of the English bookmaker.

The Advocate General concluded that the Italian legislation cannot be justified. The legislation of the member state where the service was provided (in this case the United Kingdom) already provided a sufficient guarantee of the integrity of the organizer of the bets. As far as discouraging gambling is concerned, the actual increase in the availability of games of chance facilitated by the Italian legislature in recent years belies the existence of a coherent policy of limiting gambling opportunities. For that reason, the alleged objectives, which are not (or are no longer) pursued in reality, are not sufficient to justify impeding the freedom to offer services of providers established and duly authorized in other member states.

The verdict in the Gambelli case will be announced by the end of this year since the judge in the case will retire Jan. 1, 2004.

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.