Developments at the ECJ questioning market restrictions in Austria and Sweden

Advocate General Mazák questions the legality of Casinos Austria licenses and its de facto monopoly. In his opinion delivered in the Austrian Casino case involving Ernst Engelmann (C-64/08) before the ECJ, Advocate General Mazák confirmed today that:

The requirement of an establishment in Austria “is a clear example of direct discrimination against companies who are seated in another member state”. “Contrary to the view of the Austrian government, [...] controls can be enforced on any company established in a member state and in addition, sanctions can be applied irrespective of the place of residence of its management”.

Licenses in the gaming sector must be awarded in a public and transparent manner: “Art 43 EC and 49 EC preclude national provisions […] which exclude from the tendering process candidates from the Community which do not have the nationality of that member state”.

The national court has to determine whether fiscal objectives of the legislation in fact only constitute “an incidental beneficial consequence”. Should this not be the case, the monopoly regime is in violation of EU law, regardless of the level of advertising.

“With regard to advertising, the national court must further examine to what extent the relevant strategies of the factual monopoly holder inform the potential client merely about the existence of the products and serve the purpose of guaranteeing the client regular access to games of chance, or whether they invite and encourage the clients to an active participation in games of chance”.

This opinion, if confirmed by the ECJ in its ruling, would sign the end of Casinos Austria’s de facto monopoly on poker and casino games, and lead to important reforms in Austria.

Austria has clear profit-driven objectives when it comes to gaming and betting, with no consistent or systematic consumer protection policy. The Austrian market has been continuously expanding with massive monopolists’ advertising expenditure. 77% of the shares of Casinos Austria are held by private shareholders, including banks and insurance companies.

Sigrid Ligné, Secretary General of the EGBA comments: “In this context, there is no acceptable justification to prevent reputable European competitors from offering online poker and casino games to Austrian players”.