Eye on Europe - April 14

14 April 2006

German Betting Market -- Just two weeks after the verdict concerning sports betting, where the highest German court decided that the Oddset state monopolies should scale back its activities, Burda announced the launch of commercial new betting operations in the country. Hubert Burda, an international operating publishing company with interests in the RTV-industry and Internet, will start with sports betting on June 1 through the portal www.bestwetten.de. The second product will be horse betting, which is an underdeveloped product in Germany. The new company, Burda Direct Win GmbH, will strictly follow the law and will start as a reseller of state-licensed betting operators.

Betsson Goes Polish -- Swedish Betsson has launched its gaming services in Poland, and an office has been established to run its operations from there. Poland has a population of over 37 million people, 30 percent of which are connected to the Internet. Betsson's goal is to be, within one year, one of the three biggest foreign gambling companies with Internet gambling operations located in Poland. Its three biggest competitors in Poland--SportingBet, BetandWin and Expekt --all operate under the law of their respected countries, not the Polish law, which gives a monopoly to the state. "Betsson does not agree with the interpretation of the European law used by the Polish officials, nevertheless we, as always, are setting all our operations according to the law," Tomasz Piotrowski, manager of Betsson in Poland, explained. "Poland is not an exception; therefore, we cannot operate on the market as our offline Polish competitors do. Due to the fact that our operations are physically not in Poland, we only have to proceed according to the laws concerning information and advertising restrictions for gambling as such ('Ustawa o grach losowych'). We also sometimes fall under some laws concerning specific media (i.e. TV). Still we are confident that the Polish market will be growing with us as one of its main players."

Casinos vs LFDJ -- The association of modern casinos in France (Casinos Modernes de France) has lodged a complaint with the European Commission and Prime Minister Dominique de Villepin against the monopoly that the French state has on the gambling market, claiming that La Française des Jeux (LFDJ), the state lottery operator and member of the European Lotteries, is abusing its dominant market position. The association has called on the prime minister to abolish LFDJ's monopoly, and has threatened to go to the Council of State if it does not receive a response within two months. LFDJ, in which the French state has a 72 percent holding, was surprised at the measures and pointed out that it does not operate in the same sector. The casino operators are concerned, however, with the diversification of LFDJ's activities, which they say is bringing it into closer competition with casinos. They also believe they are being discriminated against, as, unlike LFDJ, they are not allowed to use the Internet for commercial purposes. The association says it will not take legal action if all those involved enter into talks to find a fair solution. Casinos modernes de France mainly represents the Partouche group. The French Casino Trade Association (Syndicat Professionnel Casinos de France), which mainly represents the Lucien Barrière, Accor Casinos and Tranchant groups, did not participate in the above mentioned actions.

Controversial Cyprus Contract -- An interesting difference of opinion concerning a new gambling tax has come up on the Greece side of Cyprus. Several interested parties, including the Greek lottery, OPAP, are trying to prevent the bill from becoming law. The proposed policy distinguishes electronic fixed-odds bets from Greek lottery OPAP's network of 330 branches island wide. OPAP officials say that an agreement in place between Cyprus and Greece excludes electronic gambling. The 25 percent betting tax has been set to 15 percent for all punters. That means that OPAP's "non-electronic" punters will also have to pay 15 percent, whereas they currently pay 10 percent. It has been suggested that OPAP also fears it will lose its monopoly--and thus its power to control the flow of bets--if bets can be placed electronically.

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.