Eye on Europe - Dec. 1, 2006

1 December 2006

New Lobbying Target -- Charlie McCreevy, the European Commissioner for Internal Market and Services, has started to use soft law instruments called "recommendations" to shape the EU's internal market. A recommendation is a non-binding document published by the Commission indicating how it would like companies or governments to behave or how it may legislate in future, with EU civil servants free to disgorge recommendations without any control from the European Parliament or EU member states. In contrast, a directive is a binding piece of EU law that involves a complex "co-decision" process between member states and Members of the European Parliament (MEPs), which can take three or more years. Critics and MEPs point out that recommendations have a "legal impact" and stimulate market changes that are later impossible to reverse. And that would be a solution for the EU gambling industry. A new lobbying target?

Bankruptcy -- Polish lottery monopoly Polski Monopol Loteryjny (PML), NOT a member of the European Lotteries (EL), is reportedly facing bankruptcy. The Warsaw Business Journal reported that PML has but a few employees and is based in a hotel in Warsaw's Praga district. According to the news source, the treasury minister, having obtained information on PML's finances, filed a motion to declare bankruptcy. However, it is believed that the court has rejected the application, stating that the minister could simply dissolve the company. But, the news source said that the presence of a foreign investor would complicate dissolution. And who is the foreign investor? Greek Intralot, an EL member! PML only deals with their scratch card tickets, which are sold through the Tot-Mix and Polish Post points, and they are competing with Totalizator Sportowy Sp. z o.o., which has nearly 11,000 selling points and daily TV presence. Two years ago the two Polish operators were trying to merge, but the suppliers of both parties had long-term contracts at the time and were not willing to give in.

Not Available for Comment -- T-Mobile Slovakia came with a press release, concerning its Millionfold-Christmas-game with SKK 60 million (US$2.2 million) prize money. And since international operating telephone companies hardly ever information publishes on their direct and indirect involvement in the gambling/gaming industry, I contacted T-Mobile's international pressroom in Bonn, Germany for more information. I wanted to know if such Christmas gambling products, or any other gaming products, are offered to T-Mobile clients in other countries (the United States, Great Britain, Netherlands, Germany, Austria, Czech Republic, Hungary, Croatia, Macedonia and Montenegro). I also had some questions about the company's gambling/gaming policies. Several times I have contacted the T-Mobile's press department, and I am still waiting for any reaction.

Milli Piyango -- Intralot informed the Athens Stock Exchange on April 11, 2006 that it was interested in the Turkish state lottery, Milli Piyango. The official text was: "The company's intention is to participate in the privatization process of the Turkish state lottery, Milli Piyango, as announced as an intention of the Turkish government in light of privatizations. The relative tender, which will define the form of privatization, has not been announced yet. When developments take place we will inform the investment community and the regulating authorities through an announcement, as defined by existing legislation." Last week Socrates Kokkalis, head of the executive board and CEO of Intracom and owner of Intralot, gave some more details: "The consortium for the privatization for the Turkish National Lottery will exist out of four companies. One of them is our company. One of the others is Turkish." Sales in 2005 for Milli Piyango totaled US$624.7 million. Sales realized outside Turkey were US$2.67 million.

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.