Austria’s Court of
Audit has criticised the process to award casino concessions in the country for
a lack of transparency in the decision making process, just under a year after
the licences awarded to NOVOMATIC and a Swiss-German consortium were revoked.
As part of the process
three new casino licences were awarded, with two secured by NOVOMATIC and one
by Plaza 3 Entertainment Development AG, a consortium comprising Casino Baden
AG and Gauselmann Group.
The process to award
the licences was concluded in June 2014, only to be derailed following
complaints by existing licence holder Casinos Austria, which currently operates
12 casinos across the country.
Bundesverwaltungsgerichthof (Federal Administrative Court) found that
significant conditions of the application process, and the terms by which these
applications would be evaluated, were not disclosed.
These complaints were
upheld by the Court of Audit, which noted that the tender documents “left a lot
to be desired,” blaming time pressure for the process’ deficiencies.
“The time pressure in
the final stage of the process led to errors in the concession process that had
to be rectified in adjustment notices,” the court explained.
The tender documents
gave little indication as to what a viable application should entail, or on
what key points the applicants would be judged on.
The three new
concessions were awarded alongside the country’s six existing licences, which
were granted to the existing licence holder Casinos Austria.
state-owned gaming company was named winner of the existing six concessions
based on a percentage system in which it fulfilled ten per cent more of the
criteria than any other bidder.
However, for the three
new licences, the winning bidders were chosen on the basis of having fulfilled
between 1 and 2 per cent more points than other applicants. The Court of Audit
noted the small gap between the winning bidders and the losers, compared to
Casinos Austria dominating the process for the existing licences.
“The design of the
concession regime, tendering processes and decision-making were marked by
shortcomings in the transparency and substantive accountability,” the Court
It also criticised the
non-disclosure of sub-criteria and the lack of insight into the Advisory
Board’s discussion processes.
It is unclear what
steps will now be taken, though it appears likely that the process will have to