Cypriot police raided a string of betting outlets on Friday to enforce the country’s recently passed gambling law, which banned all forms of online gambling other than sports betting.
Nineteen people, including shop managers and customers, were charged with offences under the new Act, and now face up to five years in jail and/or a €300,000 fine if found guilty. The new law makes the possession and/or operation of devices for the purposes of running an online casino or poker room illegal, while also banning the advertising of illegal gambling, that now includes online poker, casino and exchange betting.
Seventeen computers, €2,200 in cash and gambling slips were also seized by police from seven shops, according to local press reports. Law enforcement authorities are faced with the daunting prospect of enforcing the law across the 1,000 or so online gambling shops operating across the EU Member State ahead of the ban passed into law earlier this month. Police confirmed in a press statement that they intended to carry out further raids on the island’s betting outlets, which accept deposits from customers over the counter who then play or bet using computer terminals.
One online gambling shop chain that was providing services on behalf of online gambling operators based in England, Ireland and Malta, AA Crown Bet Ltd, also told the Cyprus Mail last week that it was considering legal action over the law that forced the closure of its 16 shops.
Lawyer Yiannos Georgiades from Nicosia law firm Georgiades & Mylonas said that the law violated the free movement of goods and services and freedom of establishment rights within the EU Treaty, and that AA Crown Bet was looking into the possibility of issuing a lawsuit against the Cypriot state, filing a complaint to the European Commission and going to the ECJ (now known as the Court of Justice of the European Union).
While Georgiades admitted that restrictions on these rights were accepted by the ECJ if consumer protection grounds could be established, he argued that Cyprus had failed to adhere to the associated principles of proportionality and non-discrimination by allowing Greek Monopoly OPAP to continue to offer games of chance under a bilateral agreement between the two countries.
Ahead of the controversial ban coming into force, police were forced to protect 168 OPAP shops after nine shops came under attack from arson and gunfire, believed to be connected to disquiet from other gambling operators over OPAP’s exemption.
Georgides also pointed out that with each of the 1,000 existing non OPAP-owned online gambling and slot machine shops employing between five and 10 people, the ban could potentially add between 5,000 and 10,000 workers to the unemployment roll.
Betfair, that takes a higher share of its profit from Cyprus than 4% of revenue generated from the territory last year suggests due to operating mainly within the shop environment, also announced in the days following the ban that it was looking into legal action to limit the impact on its bottom line. The betting exchange said it believed the legislation contained “serious flaws” and was “inconsistent” with EU law. Legal arguments over how watertight the language purporting to ban betting exchanges is also seems inevitable.
Betting on sports multiples is understood to be particularly popular in Cyprus, while poker and casino combined also accounted for approximately 50% of Betfair’s Cypriot revenues, well above the group-wide average of 22%, lifting Betfair’s profits from the island on a par with those generated from the much larger population of Germany.
Betfair however declined to confirm to Casino Choice that it was one of the online operators offering services through AA Crown Bet’s shops.