The Austrian high court has ruled the 15-year lottery and egaming monopoly awarded to a subsidiary of Casinos Austria is constitutional, rejecting the appeal of three online gambling companies.
Casinos Austria subsidiary, Austrian Lotteries, was awarded the tender for the operation of lotteries in Austria in October 2011, which also included the exclusive licence to offer online casino, slots and poker games in the EU Member State under the win2day brand. The 15-year term began on 1 October 2012.
Three online gambling companies who lost out in the EU-wide lottery tender - Betclic Everest-owned Bet-At-Home, SMS game provider Lotelo and Malta-based Bandal - had lodged an appeal against the Finance Ministry’s decision at the Constitutional Court.
The companies challenged the procedure for the award of the tender as well as the provisions of the country’s Gambling Act (GSpG).
Their legal representatives argued that the tender conditions had been geared to the former monopoly applicant, highlighting the apparent coincidence that the high minimum capital requirement for companies to apply was €109m and Österreichische Lotterien’s was exactly €110m. They also challenged that this capital requirement by itself was unconstitutional and that the award of the exclusive licence interfered with constitutional rights of freedom of employment.
But the Constitutional Court in Vienna however rejected their complaints, ruling that the restrictions on the award of such concessions were adequately and objectively justified, stating in its judgment:
“The objectives of the restriction of gambling concessions, namely to prevent crime, to avoid excessive stimulation to participate in gambling by unregulated competition and to prevent gambling being exclusively organised for commercial profit are, in view of the proven social harmfulness of gambling, in the public interest.”
Competitors and legal experts had previously called for a division of terrestrial and internet licensing privileges, but leading gaming lawyers DLA Piper noted that: “It has now been made clear that the Constitutional Court ruling rejects such a division.”
A Bet-At-Home spokesman told the Austria Press Agency that the company intended to draw a line under this particular legal chapter. “We take note of the judgment”, he said.
Bet-at-home was also ordered by Austria’s high court last October to repay an Austrian problem gambler €950,000 he lost playing online roulette because its permit to offer the game was not valid in Austria. This followed company founders Jochen Dickinger and Franz Ömer losing an important legal battle in Europe’s highest court in 2011, which confirmed that European gambling licences did not apply automatically in Austria.
The Court of Justice of the European Union (CJEU) also ruled in July 2012 that Austria’s refusal of advertising permits to two Slovenian online casino operators was justified on consumer protection grounds.
Article written by Stephen Carter
