Friday September 26,2014 : CJEU UPHOLDS DANISH ONLINE GAMING TAX REGIME
EGBA welcomes decision
The General Court of the European Union (CJEU) has handed down a ruling in State aid cases T-601/11 (Dansk Automat Brancheforening v Commission) and T-615/11 (Royal Scandinavian Casino Århus v Commission) who challenged the differentiated Danish tax regime between land-based and online gambling.
The ruling confirms that Member States are within legal guidelines and are able to offer a differentiated tax system given that the land based applicants are not affected by the tax regime, however, online operators need to remain competitive in terms of global offers to prevent consumers seeking out illegal websites.
EGBA Secretary General Maarten Haijer commenting on the ruling said: ” We welcome today’s decision of the Court confirming that the Commission correctly argued that online gambling requires a tax level that takes into account the competitiveness of the global online .com offer.
“With the unregulated offer just one click away on the internet, consumers will only play within the regulated environment if that offer is sufficiently attractive in terms of price and consumer experience. There are plenty examples of Member States where the regulated offer fails to attract consumers due to product restrictions and tax levels, resulting in those consumers being pushed outside the European regulatory umbrella, often to unregulated Asian offerings.
“Having a restrictive market defeats the purpose of any regulation, namely ensuring proper consumer protection. An appropriate tax level is one of the key elements in creating an attractive and safe playing environment, albeit not the only one. It is important to emphasise that EGBA does not consider a differentiated tax regime as an objective in itself. But it is imperative that the tax level for online gambling is set at a level that allows for a competitive regulated market compared to the unlicensed offer from outside of the EU.”