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Austrian Courts Maintain Monopoly on Online Gambling

Operator Austrian Lotteries claimed a major victory in its ongoing anti-trust litigation and ended its competitor’s push to derail the monopoly. The Austrian high courts maintained the 15-year exclusive lottery and egaming license awarded to the subsidiary of Casinos Austria by rejecting the appeal of three online gambling operators. 

The Austrian Finance Ministry awarded Austrian Lotteries with an exclusive online gambling license to offer products such as slots and poker under the Win2day brand.  The online gambling license came into effect on 1 October 2012 and has drawn the ire of competitors.

Three operators who lost the bid on the European Union lottery tender filed a complaint against the Finance Ministry at the Constitutional Court. Operators Bet-At-Home, Lotelo, and Bandal challenged the license application process and certain provisions of Austria’s Gambling Act.  The legal representation for the three operators adamantly argued that the licensing process and certain provisions of the Gambling Act favored the existence of a monopoly and was therefore unconstitutional. Specifically, they pointed to the high minimum capital requirement as a restriction for smaller operators and to certain provisions of the Gambling Act that violated the right to employment. Coincidentally, the minimum capital requirement was set at €109 million, which happens to be slightly less than Austrian Lotteries’ available capital.

Nevertheless, the Constitutional Court in Vienna rejected the complaint and maintained Austrian Lotteries’ stronghold on the online gambling market in the country. The court provided a statement on its decision.

 “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 organized for commercial profit are, in view of the proven social harmfulness of gambling, in the public interest.”

Through the ruling, the Austrian Courts made a powerful statement about the structure of the online gambling market and its effort to curb excessive gambling. Austria’s restrictive gambling regulations have frustrated operators. Recently, Bet-At-Home, a Betclic Everest subsidiary, was ordered to repay €950,000 to an Austrian problem gambler who lost the amount on a roulette table. The Austrian courts cited the lack of a permit to offer the game within the borders of the country. Other competitors have also filed complaints against the regulations, only to be rejected by the courts.

 

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