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Bot Favors Portugal Over Bwin
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15-Oct-2008, 19:58
Tuesday, Attorney General Yves Bot of the European Court of Justice handed down a decision on the Portugal-Santa Casa monopoly case. The decision backs the member state’s prerogative to sanction state-run monopolies and fine non-Portuguese operators for infringing on them. But it also states that defendants Bwin and the Liga Portuguesa de Futebol Professional cannot be fined if the member state did not notify the European Commission that it was expanding the terms of its original legislation to include Internet gambling
The case was instigated when Portuguese authorities fined Bwin €74,500 and the Liga €75,000 for operating online gambling that, they said, violated non-profit Santa Casa de Misericórdia de Lisboa’s state-awarded monopoly. Bwin, which had no direct hand in the actual betting, was fined because it sponsored the Liga’s activities. The two firms subsequently appealed the fines, and the national court in Porto asked the ECJ to make the final ruling.
The original legislation gave Santa Casa exclusive rights to operate lotteries and off-track betting inside the member state. It did not explicitly include Internet wagers, but because it does prohibit outside firms from providing a “service,” Bot said Portugal could extend the reach of the law to include “technical” (i.e., Internet) regulations. The state’s only failure, according the attorney general, was that it did not adhere to provisions requiring member states to notify the Commission of draft technical regulations. Inasmuch as it didn’t, he said, Bwin and the Liga should not be held responsible for operating inside the law’s original parameters.
Bot then threw the ball back in Portugal’s court, ruling that it is up to local courts to decide if Portugal did, in fact, notify the Commission of the draft. If the local courts do rule that the Commission was notified, he said, then the fines on Bwin and the Liga can be upheld.
He also stated that, while the Portuguese law was in violation of European trade agreements, the agreements were not exclusively aimed at prying open member states’ gambling markets. He said that, ultimately, the European community can only require a member state to open its gambling market if it sees gambling as profitable activity and that the Portuguese ban must be upheld because its goal is not to create a profitable monopoly but to protect the public.
The ruling would appear to add additional trouble for an already beleaguered Bwin. However, Bot’s decision is not binding on the court, and judges on the ECJ must now take up the case and deliver a final verdict.