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The internal market for gambling services and the need for a clearer proportionality test

Terbea, Andra LU (2010) JURM01 20101
Department of Law
Abstract
The regulation of games of chance bears significant moral, cultural and historical features throughout the EU Member States. The particularities of gambling activities, and notably the risks they entail and the revenues they generate, have determined Member States to strictly regulate this market sector, and indeed, in some cases, to entrust the provision of such services to state-owned monopolies. The proliferation of distance communication technologies in recent years has enabled the provision of games of chance across physical borders between Member States, whereby operators established and licensed in other Member States have started to challenge national regulations in order to gain market access.

The Court of Justice has... (More)
The regulation of games of chance bears significant moral, cultural and historical features throughout the EU Member States. The particularities of gambling activities, and notably the risks they entail and the revenues they generate, have determined Member States to strictly regulate this market sector, and indeed, in some cases, to entrust the provision of such services to state-owned monopolies. The proliferation of distance communication technologies in recent years has enabled the provision of games of chance across physical borders between Member States, whereby operators established and licensed in other Member States have started to challenge national regulations in order to gain market access.

The Court of Justice has established that gambling activities are subject to the internal-market constraints, and thus capable of restricting the economic freedoms enshrined in the Treaty. In the lack of harmonisation, the Court has in its case-law acknowledged the sovereign right of Member States to regulate their gambling markets with reference to the moral and cultural aspects of gaming. However, insofar as measures enacted in accordance with the principle of subsidiarity amount to a restriction upon the fundamental economic freedoms, they must be justified by overriding reasons of public interest, and fulfil the proportionality requirements.

Overriding reasons commonly referred to by Member States are those of consumer protection against addiction and fraud, and the need to eradicate and prevent criminal activities on the gambling market. These policy aims have largely been accepted by the Court as legitimate public order concerns capable of justifying freedom of movement restrictions, and the proportionality assessment has been (save for in some cases) generally left to the referring national courts, which are consistently provided with a set of vague and insufficient guidelines by the Court of Justice. Considering the relatively large amount of preliminary references currently pending before the Court, national courts are in need of more efficient tools for assessing compatibility between national regulatory measures and EU law.

Notwithstanding the wide degree of discretion afforded to the Member States’ governments and authorities in defining their policies and the aims that such measures seek to attain, it is argued that the consistency requirement developed by the Court of Justice as an instrumental measure of suitability needs to be clarified in order to fulfil its function. Moreover, a more intense proportionality inquiry by the Court itself is advocated for, whereby it is feasible to require that Member States bear the burden of proof as to the necessity and suitability of restrictive measures. This would both increase legal certainty, and enable Member States to thoroughly review the genuine aims of their restrictive legislation, and adequately address the realities of cross-border gambling. (Less)
Abstract (Swedish)
Regleringen av hasardspel i EU:s medlemsstater präglas av moraliska, kulturella och historiska hänsyn. Spelverksamhetens särdrag, och framförallt dess skadliga följder samt intäkterna den genererar har medfört att medlemsstaterna generellt sett reglerar denna marknad på ett restriktivt sätt, och i vissa fall anförtros tillhandahållandet av speltjänster till statliga monopol. Den snabba utvecklingen av ny kommunikationsteknik under senare år har möjliggjort omfattande gränsöverskridande tillhandahållanden av hasardspel, då etablerade aktörer från andra medlemsstater har börjat utmana nationella bestämmelser för att få marknadstillträde.

EU-domstolen har genom sin praxis fastställt att spelverkamhet är föremål för den inre marknadens... (More)
Regleringen av hasardspel i EU:s medlemsstater präglas av moraliska, kulturella och historiska hänsyn. Spelverksamhetens särdrag, och framförallt dess skadliga följder samt intäkterna den genererar har medfört att medlemsstaterna generellt sett reglerar denna marknad på ett restriktivt sätt, och i vissa fall anförtros tillhandahållandet av speltjänster till statliga monopol. Den snabba utvecklingen av ny kommunikationsteknik under senare år har möjliggjort omfattande gränsöverskridande tillhandahållanden av hasardspel, då etablerade aktörer från andra medlemsstater har börjat utmana nationella bestämmelser för att få marknadstillträde.

EU-domstolen har genom sin praxis fastställt att spelverkamhet är föremål för den inre marknadens begränsningar, och kan således hindra de i fördraget förankrade ekonomiska friheterna. I brist på harmonisering inom området, har domstolen i sin rättspraxis erkänt medlemsstaternas suveräna rätt att reglera sina spelmarknader med hänvisning till de moraliska och kulturella aspekterna av hasardspel. I den mån åtgärder som vidtagits inom ramen för subsidiaritet utgör en restriktion av de grundläggande ekonomiska friheterna, sådana inskränkningar måste vara motiverade av tvingande skäl av allmänintresse, samt uppfylla kravet på proportionalitet.

De tvingande hänsyn som medlemsstaterna ofta hänvisar till omfattar konsumentskydd mot spelmissbruk och bedrägeri, samt behovet av att utrota och förebygga brottslighet på spelmarknaden. Dessa mål har i flertalet fall godkänts av EU-domstolen såsom legitima skäl som gäller säkerställandet av den allmänna ordningen och som kan motivera inskränkningar i den fria rörligheten, medan proportionalitetsbedömningen har (med undantag för vissa fall) överlåtits på de nationella domstolarna, som utrustats med en rad vaga och otillräckliga riktlinjer av EU-domstolen. Den relativt stora mängd begäranden om förhandsavgöranden anhängiggjorda vid domstolen påvisar ett tydligt behov från de nationella domstolarnas sida av effektivare verktyg för bedömningen av kompatibilitet mellan nationella åtgärder och EU-rätten.

Trots det omfattande utrymmet för skönsmässig bedömning som nationella regeringar och myndigheter åtnjuter i utarbetandet av regleringar ägnade att säkerställa en viss skyddsnivå, argumenteras det att kravet på konsekvens som EU-domstolen utvecklat som ett instrumentellt mått på en åtgärds lämplighet måste klargöras ytterligare för att uppfylla denna sin funktion. Det förordas också att EU-domstolen själv genomför en grundlig proportionalitetsavvägning, då det är möjligt att ålägga medlemsstaterna bevisbördan för nödvändigheten och lämpligheten av restriktiva åtgärder. Detta skulle dels öka rättssäkerheten, och dels göra det möjligt för medlemsstater att närmare undersöka de verkliga syftena bakom sina regleringar, samt vederbörligen anpassa dessa till en verklighet där gränsöverskridande spel faktiskt förekommer. (Less)
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author
Terbea, Andra LU
supervisor
organization
course
JURM01 20101
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
EG-rätt
language
English
id
1628024
date added to LUP
2010-07-13 11:35:26
date last changed
2010-07-13 11:35:26
@misc{1628024,
  abstract     = {The regulation of games of chance bears significant moral, cultural and historical features throughout the EU Member States. The particularities of gambling activities, and notably the risks they entail and the revenues they generate, have determined Member States to strictly regulate this market sector, and indeed, in some cases, to entrust the provision of such services to state-owned monopolies. The proliferation of distance communication technologies in recent years has enabled the provision of games of chance across physical borders between Member States, whereby operators established and licensed in other Member States have started to challenge national regulations in order to gain market access.

The Court of Justice has established that gambling activities are subject to the internal-market constraints, and thus capable of restricting the economic freedoms enshrined in the Treaty. In the lack of harmonisation, the Court has in its case-law acknowledged the sovereign right of Member States to regulate their gambling markets with reference to the moral and cultural aspects of gaming. However, insofar as measures enacted in accordance with the principle of subsidiarity amount to a restriction upon the fundamental economic freedoms, they must be justified by overriding reasons of public interest, and fulfil the proportionality requirements.

Overriding reasons commonly referred to by Member States are those of consumer protection against addiction and fraud, and the need to eradicate and prevent criminal activities on the gambling market. These policy aims have largely been accepted by the Court as legitimate public order concerns capable of justifying freedom of movement restrictions, and the proportionality assessment has been (save for in some cases) generally left to the referring national courts, which are consistently provided with a set of vague and insufficient guidelines by the Court of Justice. Considering the relatively large amount of preliminary references currently pending before the Court, national courts are in need of more efficient tools for assessing compatibility between national regulatory measures and EU law.

Notwithstanding the wide degree of discretion afforded to the Member States’ governments and authorities in defining their policies and the aims that such measures seek to attain, it is argued that the consistency requirement developed by the Court of Justice as an instrumental measure of suitability needs to be clarified in order to fulfil its function. Moreover, a more intense proportionality inquiry by the Court itself is advocated for, whereby it is feasible to require that Member States bear the burden of proof as to the necessity and suitability of restrictive measures. This would both increase legal certainty, and enable Member States to thoroughly review the genuine aims of their restrictive legislation, and adequately address the realities of cross-border gambling.},
  author       = {Terbea, Andra},
  keyword      = {EG-rätt},
  language     = {eng},
  note         = {Student Paper},
  title        = {The internal market for gambling services and the need for a clearer proportionality test},
  year         = {2010},
}