Eye on Europe - April 22, 2006

22 April 2006

Tjeerd Does It Again -- Tjeerd Veenstra, the director of Dutch De Lotto and the readiness-for-battle crusader against international Internet sports betting operators, can add another legal victory to his prizewinner's list. This time, again, it was a verdict of the Supreme Court. The procedure began in 2002, when De Lotto started summary proceedings versus some 50 Internet operators. The court in Zutphen decided that the Internet sports betting companies could not operate in the Netherlands. During the procedure, all but three of the international operating gambling organizations stopped "intruding" on the Dutch gambling jurisdiction. The three holdouts, Betfair, Interwetten and Grün Weiss, appealed in the Arnhem court, and their claims were later dismissed because the judge found that the Dutch gambling policy was not against the European law. Now, the highest court has confirmed this judgment. The latest ruling builds on last year's big De Lotto victory in which the Supreme Court ruled that English bookmaker Ladbrokes can not enter the Dutch market either. Tjeerd is a happy man, and he probably cannot even remember anymore how many court cases he has won. But he surely knows how many he's lost: None!

Reassuring the Member States -- Finland, just like Denmark, Germany, Hungary, Italy, the Netherlands and Sweden, has received from the European Commission a letter of notice as a first step in an infringement procedure under Article 226 of the EC Treaty. The Commission wishes to determine whether the measures in question are compatible with Article 49 of the EC Treaty, which guarantees the free movement of services. Finnish Interior Minister Kari Rajamaki, responsible for the three Finnish gambling monopolies (Veikkaus, Fintoto Oy and RAY), believes that Finland is well poised to defend its existing betting model at EU level. Finland's stance has always been very robust; the Fins even distanced themselves from the Gambelli verdict. The above mentioned countries have two months to answer the Commission; then it will be clear whether there is sufficient evidence to go to the European Court of Justice. Charlie McCreevy, the internal market and services commissioner, downgrades the letter of notices. He told the member states that sending these letters does not mean that the market should be liberalized. It is more or less a check, he said, to see whether member states are fully compatible with existing EU laws.

Quick Bingo -- EGET, the Finland-based supplier of managed digital gaming services and solutions, has announced the latest delivery of single and multiplayer bingo games to three of its customers: Paf.fi (Finland), Paf.se (Sweden) and Fortuuna.ee (Estonia). With the latest delivery, EGET brings to market Free Square and Quick Bingo in single and multiplayer versions. With Free Square, players can get to bingo more easily as they get marked squares in their tickets for free. Quick Bingo, on the other hand, brings speed to the game, as there are fewer numbers involved in the ticket grids and draws.

Name Dropping -- Finally the new National Lottery (Loteria Romana) administration council has met in its new setting. Present were representatives of the Ministry of Justice, the Ministry of European Integration, Liliana Chervasuc (the new council's president), the council members, Horia Dumitrescu (Ministry of Defense), Roxana Batar (director in the National Agency for Fiscal Administration) and Marilena Constantinescu (representative of the Ministry of Justice). Some weeks ago, Minister of Public Finance Sebastian Vladescu decided to oust Nicolae Cristea, the general manager and chairman of the board of the Romanian Lottery and a member of the European Lotteries Executive Committee. The European Lotteries will organize its "Industry Days" in Bucharest, the capital of Romania, May 10-12, 2006. Chervasuc, who is the new general manager of Compania Nationala "Loteria Romana" S.A., and Vladescu will welcome their international gambling guests. Cristea is nowhere to be found on the program.

Intralot's Lucky Number -- European Lotteries member Intralot, which is after a further buyback of its own shares via ASE up to a percentage of 10 percent on the total of the existing shares, has been selected as the preferred bidder of China Trust Commercial Bank in Taiwan (CTCB), a member of China Trust Financial Holding Company, which has received the license from the government to operate the Public Welfare Lottery. Intralot will provide the lottery IT system, along with the necessary maintenance services for the operation of the Public Welfare Lottery. The project duration is seven years, and it will cost approximately €35 million.

EL (Non) Information #1 -- More than five years ago, the European Lotteries (EL) decided to start to attach to its lottery members list a so called "Visit Card" (VC). On it one could find information on the management, products, addresses, Web sites, beneficiaries and key financials. Of the 74, 72 or 70 members of the EL (see #2 below) only 23 have created a VC. Of the 18 German members, only five have their own VCs. Perhaps after the Karlsruhe sports betting verdict, the VCs may become an important promotion tool. Only a view members are updating their information regularly. And I want to mention all the VCs who show their 2005 turnover in millions in euro:

  • NKL Nordwestdeutsche Klassenlotterie, Günther Schneider (Germany): 494
  • Toto- Lotto Niedersachsen GmbH, Dr. Rolf Stypmann (Germany): 876
  • Szerencsejáték Rt., Gábor Székely (Hungary): 526
  • Santa Casa da Misericórdia de Lisboa (SCML), Rui Cunha (Portugal): 1,532;
  • Compania Nationala "Loteria Romana," Liliana Chervasuc (Romania): 194.

And that is all. Westdeutsche Lotterie GmbH & Co. OHG, whose president and CEO, Dr. Winfried Wortmann, is also president of the EL, last published its financials in 2002 (€1.93 billion, compared to €2.06 billion in 2001).

EL (Non) Information #2 -- All press information of the association of the European state lotteries and toto companies (EL) ends with, "We are representing 74 organizations across Europe," but when you count the number of members (mentioned on the EL Web site), you cannot count further than 70 members. Last week IGN reported that two companies mentioned on the list, Lottomatica and Sisal, quit the EL last June. What happened to the other two members?

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.