The Dutch Council of State has determined that Kansspelautoriteit (KSA), the Dutch regulator, may continue with a monopoly model for certain gambling categories.
Lotto BV, a subsidiary of the state-owned Nederlandse Loterij, had its three exclusive licences renewed at the start of the week for lottery games, instant lotteries and retail sports betting.
Though the regulator made clear that it would have preferred to wait for a final ruling from the Council of State before doing so, the imminent expiry of these licences at the end of the year forced it to act and give Lotto BV some clarity.
Had the ruling gone the other way, those licences might have been revoked.
JVH Gaming and Entertainment loses out
JVH Gaming and Entertainment operates a number of slots halls across the Netherlands, though only Holland Casino has the right to run venues with casino games.
Nonetheless, JVH applied for a licence in 2021 to compete in the same markets as Lotto BV.
The KSA rejected those applications, maintaining the monopoly system that was created by the 1964 Gambling Act.
JVH took this to the district courts, and question marks were raised over how this decision interacted with EU laws relating to free, fair and competitive trade, as well as the free movement of services.
However, the regulator always maintained that the restriction was proportionate and justified.
The inconsistency argument
The online gambling marketplace in the Netherlands does not follow the same monopoly model, having been opened up in 2021 via the Remote Gambling Act (KOA).
This inconsistency gave some credence to calls for the other gambling sectors to be opened up in the same way.
The District Court of East Brabant judged that this argument held water in 2024, and it judged that JVH’s appeals against the KSA’s decision were well-founded.
No action was immediately necessary on the part of the KSA, with the ruling suspended pending the outcome of counter appeals from Lotto BV in conjunction with the regulator.
These were the appeals considered by the Council of State, which has now ruled: “In view of the foregoing, the Division is of the opinion that the District Court wrongly ruled that the restriction of the single licensing system for instant lotteries, sports betting, and the Lotto is disproportionate.”
The judgement of the District Court from 2024 is therefore set aside – though this may not be the last we hear of the discussion, depending on if JVH and the rest of the interested parties decide to leave the argument where it lies.
