Online gaming and betting: French MPs to decide over viability of French law

Brussels, 6 October 2009

The European Gaming and Betting Association (EGBA) re-iterates its concerns over some of the key provisions of the French draft law to be debated on 7, 8 and 9 October in the French National Assembly. Seven months after its notification to the European Commission, EGBA considers that the French proposal still conflicts with the EC Treaty.

“Several key restrictions in the draft do not serve any general interest purpose, whether consumer or public order protection” says Sigrid Ligne, Secretary General of the EGBA.

1. The opening of the horserace betting market limited to pool betting only: this restriction based on the sole justification that it is a “French tradition” will force incumbents to align their offer with the one of PMU. It will prevent them from offering fixed odds bets on horse races to French players, while this type of popular bets will be authorized for all other sports.

2. EU operators forced to cap their payback ratio to players, allegedly for the sake of limiting problem gaming: this will again force new entrants to erase one of their most competitive arguments. To date there is no evidence whatsoever of such allegation as confirmed by the European Commission. The average ratio (percentage of stakes paid back to players) is currently 75% for FDJ and 78% for PMU while online EU operators usually pay back 95% to players.

3. EU operators forced to establish an IT platform in France in order to provide data which could, in full transparency, be provided cross-border from their existing IT platforms. Such obligation would lead to duplications and create a clear operational and financial disadvantage for non-French operators.

4. The introduction of a “sports betting right” creates a worrying precedent in many ways. First, it grants sports entities ownership of information currently in the public domain (name and results of events or fixture lists) and also used by other professions such as journalists. Second, it will favour the most attractive competitions and sports federations at the expense of less visible sports. Third, most EU regulated operators already enforce early detection systems (such as the one of ESSA) at their own cost which allows them to block suspicious bets and alert in real time the relevant sports authorities.

These concerns also beg the question as to whether the French model will be workable and economically viable. “Ring fencing the French market goes against the cross-border nature of the Internet and would lead to the emergence of an underground and uncontrolled market where consumers would be deprived from any protection” added Sigrid Ligné.

press release of EGBA