EU Commissioners are sorting fundamentals with a landmark query on gambling, state rights, and freedom

EU Commissioners are sorting fundamentals with a landmark query on gambling, state rights, and freedom

european_commission_to_look_into_malta_gambling_bill_amendementCreating the modern European Union was no mean fete – at a minimum it required a loose harmonization of mission and laws between about two dozen nations agreeing to follow a charter originally launched in the 1950s between Belgium, France, Germany, Italy, Luxembourg, and the Netherlands more than quadrupling membership.

For the most part, squabbles and major disagreements have been handled through a process that seems to work, even when nobody ends up getting what they really- their pretty cake to look at and the ability to eat it as well on both sides.

European Commissioner for Justice Didier Reynders recently spoke for the Commission through a written statement, saying that the organization would examine recently passed Maltese legislation and its compatibility with broader written EU law and case law as established through the courts as conflicts in interest have been settled under due process under European Union law.

Yet, today struggles still ensue when nations disagree on mandates and meanings as well as priorities. Recently the Eu Commission has requested more information from Maltese authorities in order to settle a particularly sticky dispute wherein players on both sides have a lot of “skin in the game”.

An inflection point has arisen with the gambling-centric economy of Malta, which has focused and invested heavily in becoming an independent licensing regime for online gambling operators in the EU and elsewhere – and countries such as Germany and Austria that wish to control trade in certain economic sectors within their own birders – ostensibly, for the protection of their own citizens but often, for protection of state-sanctioned monopolies that provide little or no room for online gambling operators who choose not to be licensed by individual national authorities.

In late June, lawmakers in Malta passed the controversial Bill 55, which we reported on earlier. The law protects offshore operators based in Malta from foreign liability, without regard to EU membership.

This means that, if left standing, the law would shield Malta Gaming Authority licensed online casinos and other betting sites from potential liability in cases arising in another member state.

On one extreme it would protect operators from frivolous lawsuits brought by players who bet and lost but think they should be able to recover those losses and on the other end of the spectrum it could leave players in other member-states with no remedy except as provided by the Maltese gambling authority.

A supreme power struggle is underway in the conflict which pits two seemingly opposing concepts of the Union against each other – a state’s right to protect its citizens from harm, albeit through a counter-intuitive monopolization within a member-state’s borders of an important economic metric such as the multi-trillion-euro per year international online gambling industry – and a member state’s right to compete freely anywhere within the union.

The EU Commission was invited into the conflict by three questions asked of it by German MEP Sabine Verheyen. Quite simply, Verheyen asked in one written question after stating Germany’s position that it had a right to protect its citizen from harm by outside actors whether the Maltese law was in accord with EU law and if not, what the Commission planned to “do about it”. Further query related to what sanctions could be imposed. NO reply was given to the question of sanctions.

The next two questions were oddly unrelated, but seem structured to cast the authority in a bad light – whether deserved or not – and not apparently relevant to whether free enterprise trumps de facto monopolization of a certain industry through real or contrived protective measures.

The Commission was also asked whether there were any known links between the government of Malta and the online gambling industry and if there have been any cases of corruption to date.

To the question of links between industry actors and the Maltese government or gambling authority, Verheyen replied: “The Commission has no information on possible links of individual members of the Maltese government to the Maltese gambling industry.”

Working to build Germany’s case against Malta, one of the two founding principles of the EU was invoked when the Commission was queried about infringement proceedings policy referring to Article 258 in the Treaty on the Functioning of the European Union.

However, another interpretation of the core values the Commission will be striving to balance might be:”…promoting peace and security, and respecting fundamental rights and freedoms,” in layman’s terms.

As always, the devil is in the details. Please click the following link to read the Malta Gambling Amndment Bill 55.

The full answer, as given by Mr. Reynders on Behalf of the European Commission along with supporting documentation, can be found at the following link to parliamentary question E-001722/2023(ASW).

Source: European Commission to scrutinise Malta gaming bill, iGB, July 25, 2023

Author: George Wilson