The increased supply of online gambling services, authorised and unauthorised, their crossborder impact and the progressing regulation of gambling services in Member States raises the immediate question about the need for enhanced administrative cooperation and efficient national enforcement.
The regulatory authority
The effective implementation and enforcement of gambling rules and an efficient cross-border administrative cooperation requires strong institutional arrangement in Member States.
Role and competences of regulators
In the EU the role and competences of gambling regulators differ amongst Member States in terms of powers and scope. Whilst more and more Member States establish independent regulatory bodies, normally in parallel with the introduction of an open licensing system for the offering of online gambling services, the majority of Member States still entrust a specific department within a Ministry (mainly within the Ministry responsible for finance or the interior) with the task of regulating and supervising the gambling market. Having said this, the regulation and supervision of gambling services can be the competence of several authorities, depending for example on the type of game regulated or the channel of distribution.
In a rapidly developing market, it is essential for regulators to understand the business and the technology and to have up-to-date information. This assists regulators not only when setting licensing/authorisation requirements but also in the supervision of the licence holders and the enforcement of the national gambling rules. Today a number of regulators in the EU lack experience with online gambling regulation. In other cases regulatory authorities have not been set up or suffer from limited staff and resources. In the workshop organised by the Commission on efficient national enforcement measures and administrative cooperation a number of regulators expressed a lack of experience with online gambling regulation, due to their unregulated or newly regulated markets, as well as their desire to draw knowledge from the more experienced regulators.
Regulators need to have a coherent legal basis, be adequately resourced and have rules and procedures that are fit for purpose. A number of regulators deem that a regulator’s powers should cover all forms of gambling (online and land-based). Sufficient competences are crucial for effective administrative cooperation with regulatory authorities in other Member States. Effective cooperation could be hampered by the fact that not every Member State has a single, central and independent gaming regulatory authority. Also the European Parliament considers the establishment of a regulator with suitable powers in each Member State to be a necessary step towards more effective regulatory cooperation.
All Member States are therefore encouraged to set up a regulatory authority with an appropriate structure and powers or embedded in an appropriate network of competent authorities at national level to ensure appropriate administrative cooperation. Regulators need to have proper competences and engage in cooperation with relevant authorities at national level in order to meet demands for cooperation from other Member States’ regulators and not fall short of their expectations.
Enhanced administrative cooperation is imperative to meet today’s regulatory challenges. The European Parliament calls for cooperation among national regulatory bodies to be considerably expanded, giving them a sufficient remit, with the Commission as coordinator, to develop common standards and take joint action against online gambling operators which operate without the required national licence.
Existing administrative cooperation
Today administrative cooperation is organised in multilateral or bilateral agreements, mainly with a view to discuss and exchange information and best practices on gambling-related issues.
Multilateral cooperation between gambling regulators has been ongoing since the 1980′s. It takes place in two regulatory organisations, in which Member States participate: the Gaming Regulators European Forum (GREF) and the International Association of Gambling Regulators (IAGR).
IAGR is a world-wide organisation including members from the EU (Austria, Belgium, Bulgaria, Denmark, Finland, Hungary, Latvia, Lithuania, Malta, the Netherlands, Poland, Portugal, Slovenia, Spain, Sweden, the UK). The mission of IAGR is to advance the effectiveness and efficiency of gaming regulation. GREF is the only multilateral organization that concentrates on European countries. Regulators from most but not all Member States are active members of GREF. GREF’s main importance is described as providing a forum for the competent authorities to meet both at formal and informal level, exchange information and views and learn from the different approaches of the participating countries (best practices) regarding land-based and remote gambling. GREF serves as a body to represent the different views of European gambling regulators and also provide a central point of contact for enquiries directed at them from authorities or related organisations in Europe and elsewhere.
Both, GREF and IAGR, have established eGambling working groups. The work focuses primarily on getting a common understanding of the risks and the options for dealing with the risks in terms of consumer protection, ensuring gambling is fair and keeping crime out of gambling.
Existing multilateral cooperation has been successful in sharing experiences and good practice. The group has produced good practice guidelines for internet gambling. Members learn from one another and discuss particular challenges of gambling regulation and enforcement, on a non-political and technical basis. However the work and the results achieved seem to be limited due to the scope and mandate of the organisations and a number of constraints on the exchange of information and data. The informal structure and the nonbinding character of statements and recommendations discussed impede the development of common policies and measures.
Bilateral cooperation agreements
More recently Member States’ regulators have started to enter into bilateral cooperation agreements. On 28 June 2011 the French and Italian gambling authorities signed a first crossborder cooperation agreement. The purpose of the agreement is to improve the enforcement of the respective national regulatory systems and the effectiveness of the regulatory work by sharing information and experience in four key areas: compliance checks on operators licensed in both countries and adoption of player protection measures, institutional communication strategies, preventing fraud in the sports sector and the fight against websites of unauthorised operators.
In May 2012 Denmark and Malta entered into a cooperation agreement. The two jurisdictions intend to exchange information in particular to enhance and facilitate respective licensing processes and the monitoring of licence holders, to protect young and vulnerable groups and to protect players. The agreement also raises the issues of equipment location parameters and common use of B2B service providers. The Member States aim to cooperate on enforcement of their gambling laws regarding joint licensees and to collaborate on areas such as non-duplication of requirements and controls, shared responsible gaming initiatives and employee exchange programmes.
Denmark has signed agreements with a number of jurisdictions, such as Alderney, Gibraltar and the Isle of Man, in order to establish a formal basis for cooperation and information sharing between the competent authorities.
Bilateral cooperation allows for a better adaptation of the scope and content of the cooperation to the individual needs of the parties and can be more effective than multilateral cooperation. However, by its very nature it covers only two Member States and does not allow for common initiatives tackling the existing challenges in the cross-border online gambling market. Bilateral cooperation agreements furthermore require sufficient resources if entered into with a number of Member States.
Existing bilateral and multilateral cooperation agreements help Member States in their regulatory work and have proved useful in achieving a certain degree of cross-border cooperation. These agreements however have deficits in terms of the quality of information that can be exchanged and the implementation of decisions taken in multilateral structures and thus often does not meet needs of a regulator. Member States miss appropriate structures for the exchange of information as well as focussed discussions and an appropriate follow-up on agreed implemented programmes.
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