News

Gambling revenue in Lithuania hit €43.4m in the first quarter, with online revenue up despite a ban on marketing.

Lithuania.- Gambling revenue continues to grow in Lithuania, rising by 90 per cent year-on-year to €43.4m. Part of the rise can be explained by the return of land-based gaming after Covid-19 lockdowns, but online gaming revenue also rose.

Despite tight restrictions on gambling advertising, online gambling revenue was up 16.7 per cent year-on-year at €26.8m. Category A slots, which have no cap on stakes or payouts, generated €15.5m, an increase of 24.7 per cent year-on-year. Stakes were €210.4m.

Category B slots, which have a stake limit of €0.50 per spin and have a payout cap at 200 times the original stake, generated €683,313, up 57.9 per cent from Q1 in 2021. Table games generated €1.6m, up 25.5 per cent, from €19.4m in stakes. Betting stakes totalled €125.3m, generating revenue of €9m.

The land-based gaming sector generated revenue of €16.9m. Category A slots accounted for €3.1m from stakes of €12.4m, and category B machines €7.2m from stakes of €45.4m. Retail sports betting revenue was €2.7m from stakes of €25.9m and table game revenue €4m from stakes of €18m.

Revenue in the same quarter in 2021 was negligible due to the closure of venues amid the Covid-19 pandemic. The government collected €8.2m in lottery and gaming taxes in Q1, a rise from €4.2m in Q1 2021.

The rise in gambling revenue comes despite Lithuania’s prohibition of gambling marketing. The Gambling Supervisory Authority this week fined Top Sport €25,000 for violating the ban through claims made on its website last year.

An inspection by the Gambling Supervisory Authority found that Top Sport had made statements that encouraged players to gamble, with phrases such as “Bet whether Kaunas Žalgiris will triumph in the LKL championship and whether Žalgiris will advance to the Euroleague final four”, “With Top Sport you can place a wide range of sports bets”, “Choose one of more than 400 games and claim impressive winnings” and “Guess how far Vilnius Rytas will go in the FIBA ​​Champions League and whether it will advance to the LKL final”.

The regulator said these statements breached Lithuania’s ban on gambling promotion, which prohibits inducements to gamble. The rule prohibits offering bonuses and publishing adverts and – it now seems – anything that can be considered marketing language. Top Sport has the right to appeal against the fine.

The Gambling Supervisory Authority fined Lošimų Strateginė Grupė and UAB Olympic Casino Group Baltija the same amount in March for publishing details of a poker tournament on their websites.

In January, it fined UAB Nordic’s Optibet brand for sending out a newsletter updating 10,600 customers about a change in terms and conditions. The regulator formed the opinion that the email constituted gambling promotion.

The government is consulting on plans to merge three pieces of legislation to create a unified gambling law.

Norway.- The Norwegian government has opened a consultation to collect feedback on its approved order to combine the country’s three existing gambling acts into one. The proposal from the Ministry of Culture and Gender Equality would replace the Totalizer Act (1927), Gaming Scheme Act (1992) and Lottery Act (1995).

The government approved the proposal from former culture, sports and equality minister, Abid Q Raja, last summer in order to create a common approach across all gambling. The draft decree proposes common rules for problem gambling prevention, the protection of minors and advertising and marketing.

It also proposes merging the supervision of Norway’s two state monopoly gambling operators Norsk Tipping and Norsk Rikstoto under one government department (they’re currently subject to tripartite supervision by The Lottery Committee, Ministry of Culture and Ministry of Agriculture and Food).

The national gambling regulator, Lottstift, would gain new powers, including the ability to take direct action on unlicensed operators and to place tighter restrictions on the licensed monopolies. It would be able to ask for data from financial institutions in order to inspect gambling transactions and would be able to impose a “predetermined coercive fine and infringement fees”.

Proposals also suggested the government amend advertising laws to ban all promotion of unlicensed gaming operators on any media platform.

The consultation runs until August 5. Norway’s Institute of Addiction, Civic Ombudsman and the Children’s Education and Support Department are required to submit feedback. The aim is to adopt the new legislation by January 1.

The national gambling regulator has urged state-controlled Norsk Tipping to introduce loss limits for sports betting and also to reduce the number of online casino games it offers.

The regulator’s annual report for 2021 notes that Norsk Tipping’s customer numbers and turnover hit a record high last year. That’s despite the fact that Norsk Tipping cut its month loss limits for its higher risk games from NOK 10,000 to NOK 7,500 in December 2020 and then to NOK 5,000 (€517) in September last year.

The regulator said that as well as imposing loss limits for online casino games, the operator should also have loss limits for its Oddsen sports betting brand. Meanwhile, the operator should reduce the number of casino games on its Kongkasino site.

The chair of the Betting and Gaming Council (BGC) has warned against radical changes to the gambling sector’s research, education and treatment responsibilities.

UK. Brigid Simmonds (OBE), chair of industry lobby group the Betting and Gaming Council (BGC), has warned the British government to avoid radical changes to operators’ research, education and treatment (RET) duties. She dismissed calls for a mandatory levy on operators.

In an open editorial on the Tory party’s Conservative Home news site, Simmonds called for an evidence-based approach to problem gambling ahead of the UK government’s publication of its gambling white paper.

She said: “The existing framework was described as a ‘perplexing paradox’ in which UK licensed operators face hostilities for taking bets of 22.5 million adults each month. Yet, according to regulatory statistics, the UK’s problem gambling rates stand at 0.3%, a much lower rate than the European counterparts of Italy (2.4%), France (1.3%) and Norway (1.4%).

“To any dispassionate observer, the obvious conclusion would be that Britain boasts a rigorously regulated market that is keeping rates of problem gambling low,” Simmonds wrote.

“For the past twenty years, the industry has rightly shouldered the financial responsibility for that work by paying a voluntary levy to fund independent charities tackling problem gambling.”

Despite calls for a levy on gambling operators to go direct to the Department of Health and Social Care something that the industry-backed funding charity GambleAware has called for, Simmonds said this would not mean more funds for RET. She noted that voluntary donations to GambleAware were expected to reach £39m by 2023/24.

Instead, she said the government should maintain the current funding structure, which funds a support network with 160 sites and services run by third-party charities such as GamCare, which runs the problem gambling helpline, and YGAM, which provides education for young people. A new funding structure would threaten that work, Simmonds said.

“A Statutory Levy would risk their funding models by potentially taking cash out of their coffers, and putting it into the NHS, which is not set up to deliver these services,” she said. “Meanwhile, the industry and charities have spent the last two decades busy getting on with the issue.

“Is it really designed to help RET or the general public – or is it a punitive measure to placate the anti-gambling lobby? Any Statutory Levy will not boost funding for RET; the money is already in the system with a bigger, broader commitment going forward.

“So think very carefully whether a statutory replacement would be better, would have better outcomes, and would help the vast majority of those who have a problem with gambling which can be helped outside of an NHS framework.”

MPs will decide whether Spain’s gambling regulator should oversee sports betting integrity controls.

Spain.- The Congress of Deputies of Spain has approved a motion for a full vote on proposed changes to gambling legislation that would give the state greater control over monitoring betting fraud and corruption in sports. The changes were to be approved by a health commission but will now get a full vote.

Chief among the proposals are new powers for the Spanish gambling regulator, the Dirección General de Ordenación del Juego (DGOJ), which would take control of collecting operator data related to sports betting integrity and sports corruption. Operators would need to give the DGOJ data on market movements, suspicious betting patterns and signs of potential fraud.

The DGOJ would create a new cooperation network in partnership the Spanish sports council, Consejo Superior del Deporte (CSD), which represents the interests of professional sports leagues and federations in Spain.

The DGOJ began working with the CSD last year with the aim of creating a new framework for cooperating on sports corruption issues. The idea is that the DGOJ will act as a central hub for the sharing of data to prevent, detect and investigate sports betting fraud. Data will then be shared with police.

Madrid approves decree on betting and gambling premises
Last week, Madrid’s city council approved a community decree that aims to reduce the saturation of gaming venues in the Spanish capital. The decree, which was unanimously approved, overrides current laws to introduce a minimum 300m distance requirement between all gaming and betting premises across the city’s 21 districts.

Gambling premises, which are defined to include betting operators, gaming arcades, casinos and bingo halls, must also be at least 100m away from schools, universities and recreation centres for young people. Meanwhile, the city council will centralise the power to grant licences to gaming venues, taking this away from individual districts.

According to Madrid’s registry of businesses, there are currently 685 gambling premises in the city, comprising some 480 gaming arcades, 160 bookmakers, 33 bingo halls and four casinos.

The DGOJ’s gaming revenue and stakes figures for 2021 showed a decline in online gambling revenue despite a rise in stakes. Online gaming revenue fell 4.2 per cent year-on-year to €815m but stakes were up across all verticals.

There may have been concern that a decline in revenue was related to Spain’s new advertising restrictions, but with stakes up by 25 per cent and deposits up 216 per cent at €2.77bn, it appears to be more a result of trading.

Gross gaming revenue for March rose to DKK 525m amid a rebound for the land-based gaming sector.

Denmark.- The land-based gaming sector continues to show a recovery from the impact of the Covid-19 pandemic in Denmark. In March, total gross gambling revenue was up almost 30 per cent year-on-year to DKK 525m (€70.6m).

According to figures from the national gambling regulator, Spillemyndigheden, land-based gaming machines generated DKK 110m. Land-based casinos, generated DKK 34m, the fourth-highest total on record and an increase from DKK 31m in February.

Betting generated DKK 155m, down from DKK 184m in February, while online casino revenue remained the biggest source of revenue, up 5.6 per cent month-on-month but down 7.4 per cent year-on-year, at DKK 226m.

Danish gaming regulator updates marketing guidelines
Last month, Spillemyndigheden updated its marketing guidelines on the promotion of land-based bets and slot machines at gaming halls and restaurants. Operators must now provide clearer details about the chances of winning.

The regulator has added a new section on the chances of winning on slots. Meanwhile, it’s added updated guidance on promotions and the definition of offers including extra chances to win, lotteries and tournaments and rankings.

It said the change entails how the value of promotional draws is calculated, with the number of players predicted to take part in the draw now a deciding factor.

The Betting, Gaming, Lotteries and Amusements Bill has become law.

UK.- Northern Ireland’s Betting, Gaming, Lotteries and Amusements Bill has become law after receiving royal assent. It’s the first significant update to Northern Irish gambling legislation since the Betting, Gaming, Lotteries and Amusements Order 1985.

The legislation is the first phase in a wider overhaul of regulations, with legislation on online gaming due to follow. The legislation introduces a levy on gaming licensees as well as a code of practice.

Meanwhile, the legislation makes it a criminal offence for under 18s to use a gaming machine, with a penalty of up to six months in prison.

Betting shops will now be able to open on Sundays and on Good Friday, although they must still close on Christmas Day. That change comes after 66 per cent of respondents to a consultation in 2019 supported a relaxation in opening hours. The Committee for Communities has called for the Department for the Economy to publish guidance on safeguards for staff with regards to working additional days.

Communities Minister Deirdre Hargey said the bill “will improve protection for children and young people through the creation of a new offence of inviting, causing or permitting a young person under 18 years to play a high stakes gaming machine.”

She added: “The bill also provides increased opportunities for local charities, sports clubs and other voluntary groups to raise more money for good causes by increasing the maximum ticket price and simplifying the rules around deduction of expenses that apply to societies’ lotteries.”

At the consideration state, the Northern Ireland Assembly’s Committee for Communities has recommended that the Department of Communities now carry out research to calculate the size of the Bill’s proposed betting levy. It also called for research to define the roles and responsibilities of a new gambling regulator for Northern Ireland.

Hargey presented the new gambling Bill to the legislature in September as the first stage of a planned overhaul of gambling regulations. There’s no mention of online gambling in the Bill – that’s still to come in a second phase since Hargey says it requires a longer timescale in order to implement a regulatory framework for the sector.

The proposal, which provides regulations for the provision of virtual asset services, now goes back to the Chamber of Deputies.

Brazil.- While Brazil’s Gaming Regulatory Framework has yet to advance, there has been progress in the area of cryptocurrencies. The Brazilian senate has passed a so-called bitcoin law on the regulation of the national cryptocurrency market. The text now returns for the analysis and approval of the Chamber of Deputies.

Bill PL 4.401/2021 presented by senator Irajá provides regulations for the “provision of virtual asset services” and regulates companies’ operations. It incorporates ideas from other projects on the same topic: PL 3.825/2019 from senator Flávio Arns (Podemos-PR); PL 3.949/2019 from senator Styvenson Valentim (Podes-RN); and PL 4.207/2020, from senator Soraya Thronicke (União-MS). The original text was authored by federal deputy Aureo Ribeiro (Solidarity-RJ).

Under the bill, virtual asset service providers must obtain prior authorisation “from a dependency or entity of the Federal Public Administration.” Such authorisation may be granted through a simplified procedure.

Irajá (PSD-TO) noted that crypto assets moved $R215,000m (USD43,068m) in shares alone in 2021, apart from its use as a means of payment, which grew 6 per cent in the last year.

See also: Chancellor aims to make UK a “global hub for cryptoassets technology”

The bill will not apply to NFTs (non-fungible tokens), which Irajá said could be regulated by the executive in a subsequent act.

Virtual assets
According to the approved text, a virtual asset is “the digital representation of a value that can be negotiated or transferred by electronic means and used to make payments or for investment purposes”, with the exception of traditional national currencies and assets already regulated by law. The Executive Branch must designate a dependency of the Federal Public Administration to define which financial assets will be regulated by the future law.

Guidelines
Virtual assets service providers must follow certain guidelines, such as the obligation to control and keep the client’s resources segregated. It must also adopt good governance practices, transparency in operations and a risk-based approach; information security and protection of personal data; protection and defense of consumers and users; protection of popular savings; robustness and efficiency of operations.

In addition, services must prevent money laundering, the concealment of assets, rights and values, combat the activities of criminal organisations, the financing of terrorism and the financing of the proliferation of weapons of mass destruction, in line with international standards.

Providers
The virtual asset service provider is defined as “the legal entity that performs, on behalf of third parties, at least one virtual asset services”, which can be:

Exchange between virtual assets and national or foreign currency;
Exchange between one or more virtual assets;
Transfer of virtual assets;
Custody or administration of virtual assets or instruments that allow control over virtual assets; either
Participation in financial services and provision of services related to the offer by an issuer or sale of virtual assets.
Other types of services may be authorised if they are directly or indirectly related to the activity of the virtual asset service provider.

Switzerland’s Federal Council has approved the creation of two new licensing regions.

Switzerland.- The Federal Council of Switzerland has approved the creation of two new casino licensing regions in the country. That will allow two new casino licences to be granted, adding to the existing 21 licensees. A tender process will begin next month, with the winning licensees to be announced in autumn.

Switzerland allows one casino licence for each licensing region. Currently there are 21 regions, but the Federal Gaming Board (ESBK) recommended the system be updated to add Lausanne and Winterthur as two new regions. The existing 21 casino licences will not be affected.

There are two types of casino licences in Switzerland – Class A and Class B licences. The new regions will get Class A licences, which have no stake limits and are issued to casinos expected to generate at least CHF30m in revenue each year. There are currently eight Class A licences.

Class B licences, of which there are currently 13, have a CHF25 (€24.44) stake limit for slot machines.

Switzerland’s land-based casino licensees are able to offer online casino gaming via partnerships with online operators.

Gespa, the body that regulates gaming in the French-speaking parts of Switzerland, has named Jean-Michel Cina as its new president.

He took over from Jean-François Roth on January 1 for a four-year term. He’s the body’s second president, with Roth having held the position since Gespa was founded as Comlot in 2006

Schleswig-Holstein will open applications for its four online table game licences on May 23.

Germany.- The state of Schleswig-Holstein has unveiled the details of the application process for its online table game licences. It will open the process on May 23, and operators will have until August 15 to submit an application for one of the state’s four online table game licences by email.

The application fee has been set at €2,500. As for the criteria to award the four 15-year licences, the state’s legislature said it would evaluate operators’ “reliability, expertise and ability” and consider the applications against the goals of Germany’s Fourth Interstate Treaty on Gambling.

Schleswig-Holstein is a unique case in Germany in that it’s the only state that already allowed online casino operations prior to the introduction of the new federal online gaming legislation. Before the launch of the new regulatory system, it had no limit on the number of licences it issued, and it taxed operators 20 per cent on GGR.

The new federal legislation, which came into force last July, introduced a national regulated market for igaming and sports betting, but allowed each state to decide between two models for the regulation of online table games.

States can choose between granting a monopoly on online table games, normally falling to the state lottery, or to issue the same number of licences as the number of land-based casinos in the state. Schleswig-Holstein, Germany’s northernmost state, has opted for the latter. It has five land-based casinos and will therefore allow five online table game licences.

One of the five licences will go to state-run Spielbank Schleswig-Holstein, which leaves just four available for private operators to apply for. Christian Democratic Union parliamentary secretary Hans-Jörn Arp said these would be issued following “reputable and strict criteria”.

The tax rate established in the new state legislation will see online table game revenue of up to €300,000 a month taxed at 34 per cent. Revenue between €300,000 and €750,000 will be taxed at 39 per cent and revenue surpassing €750,000 at 44 per cent.

North Rhine-Westphalia, the most populous of Germany’s 16 states, has also decided that it will grant five online table game licences. Thüringia is adopting the monopoly model.

Meanwhile, the executive of the German state of Saxony-Anhalt has launched the website for the country’s new federal regulator, Gemeinsamen Glücksspielbehörde der Länder (GGL – The German Federal States’ Joint Gambling Authority). However, the new regulator has not yet approved any applications for online casino.

New countries on the EC list include Morocco, Myanmar, the Philippines and Senegal.

Belgium.- The European Commission has updated its list of high-risk countries whose citizens must subject to stricter checks by gambling operators. New additions on the list include Morocco, Myanmar, the Philippines and Senegal.

The executive branch of the European Union first published its list in 2016 under EU Directive 2015/849, Article 9 which has since been updated several times. It identifies high-risk countries that have deficiencies in their approaches to countering anti-money laundering and terrorism financing according to criteria defined by the Financial Action Task Force (FATF).

Gambling operators based in the European Union that offer services to countries on the list, or have customers from those counties, must carry out tighter checks. The new countries added to the list are Burkina Faso, the Cayman Islands, Haiti, Jordan, Malo, Morocco, Myanmar, the Philippines, Senegal and South Sudan.

Already on the list were Afghanistan, Barbados, Cambodia, the Democratic People’s Republic of Korea, Iran, Jamaica, Myanmar, Nicaragua, Pakistan, Panama, Syria, Trinidad and Tobago, Uganda, Vanuatu, Yemen and Zimbabwe.

When adding countries to the list, the EC identifies their risk profile and level of threat and analyses the local legal framework and its application in eight areas. This includes the criminalisation of money laundering and countering the financing of terrorism, customer due diligence requirements, record keeping and reporting of suspicious financial transactions. It also evaluates the procedures and sanctions imposed in the case of breaches.

In March, the FATF decided to keep Malta on its grey list of untrustworthy jurisdictions. However, it has suggested that the country is close to coming off the list.

It recognised that Malta had made significant reforms through its action plan after it was grey listed last year and had increased its use of the Financial Intelligence Unit’s (FIU) services to pursue money laundering and criminal tax cases.

However, the body said that an on-site review would be needed to ensure the AML measures were being implemented before Malta could be removed from the grey list.

Meanwhile, several jurisdictions have warned operators to step up checks in the wake of Russia’s invasion of Ukraine. Both the Malta Gaming Authority and Britain’s Gambling Commission warned operators to ensure they apply checks to comply with sanctions against Russia following its invasion of its neighbour.

EGBA creates cyber security expert group
Last month, the European Gaming and Betting Association created a new expert group on cyber security to facilitate information sharing on cyber threats and attacks among its members and to promote cooperation to track and resolve incidents and identify and solve security vulnerabilities.

The group will comprise cyber security experts from EGBA member operators, with a Memorandum of Understanding to allow for data sharing between the different operators. Participation will be open to all members. The group will also seek to research and implement best practices on cyber security.