Thursday, October 27, 2011 : Unless it is non-discriminatory, suitable and proportional, prevention of cross-border gambling is against the Treaty
 
The rather muddied legal waters around the question of free movement of goods and services between companies in member states of the European Union has hopefully been made a little clearer with the publication Thursday of a new opinion from the European Court of Justice Advocate General's office.
 
Advocate General Cruz Villalón issued his opinion on the joined Costa and Cifone cases regarding the access of British gambling operator Stanleybet to Italian licenses (Cases C-72/10 and C-77/10).
 
Stanleybet had claimed that the procedure to award Italian licenses protects operators that already had local licenses during a period in which the licensing procedure unlawfully excluded certain operators.
 
Advocate General Villalón opined that licensing systems and procedures in EU nations must respect the requirements of the Treaty.
 
Advocate Villalón, recalled the requirements needed to justify restrictions on the freedom to provide services between EU member nations, which apply in the Stanleybet case…in particular that legalization must be non-discriminatory, suitable and proportional.
 
“National legalization which prevents any type of cross border gambling activity, irrespective of how this activity is exercised, … , is contrary to articles 49 and 56 of the TFEU” the Advocate's opinion reads at para 82.
 
"National legalization that tends generally to protect holders of licences issued at an earlier period on the basis of a procedure that unlawfully excluded some operators can be regarded as an unjustified restriction of the freedom to provide services" he emphasises at para 58 of the opinion. "Maintaining the business position of such historical concession holders is contrary to the Treaty provisions."
 
The Advocate also notes at para 69: “Articles 49 and 56 of the TFEU oppose national legalization which guarantees the continuation of acquired commercial positions on the basis of a procedure which illegally excluded a number of operators.”
 
A date for the ruling of the European Court of Justice has not yet been set.
 
Commenting on the opinion today, Maarten Haijer, director of Regulatory Affairs at the European Gaming and Betting Association trade representative body, said: “We welcome the opinion of the Advocate General which confirms that Member States´ gambling legalization needs to comply with the basic requirements of the Treaty.
 
"It is the cornerstone of the Internal Market that a European licensed operator should have access to licenses in other Member States and be able to offer cross border services.”
 
“With several preliminary questions pending in Italy alone, it is clear that we can´t continue to expect the European Court of Justice to shape the European market. The European legislator needs to step in and introduce regulation that addresses and harmonises licensing standards within the EU.”