BWIN APPLAUDS EC DECISION (Update)

29 June 2007

Austrian online gambling group quick to comment on EC moves

One of the first companies to react to the European Commission decision to demand changes in monopolistic French, Swedish and Greek gambling laws today (Wednesday) was Bwin, a major Vienna listed online gambling group.

In a long press release the company said it welcomes the decision by the EC to continue the infringement proceedings already instituted against France and Sweden in connection with gaming by issuing "reasoned opinions."

These so-called "reasoned opinions" represent the second stage in infringement proceedings. If the countries involved do not now take the demands of the European Commission into account, they are liable to be taken before the European Court of Justice.

The fact that Greece now also sees itself confronted with infringement proceedings can be attributed to the many protectionist measures on the Greek gaming market that are not in compliance with EU legislation.

The European Court of Justice recently declared Sweden's alcohol monopoly to be in contravention of EU legislation, and the gaming monopoly is now also coming under increasing pressure. "The fact that, in the opinion of the European Court of Justice, the alcohol monopoly is not in conformity with the basic freedoms of the European Union makes us optimistic that the enlightened regulation of the gaming market will soon be forthcoming," commented Norbert Teufelberger, bwin Co-CEO.

Even France, which in the past has acted particularly aggressively towards private gaming providers licensed in the EU, has not managed to convince the Commission that its monopoly of gaming and horseracing is in conformity with EU legislation. In a detailed opinion the Commission has sharply criticized the discrepancies in the existing French regulations.

The initiation of infringement proceedings against Greece is also an indication that monopolies—even in sensitive areas such as alcohol, banking and gaming—are no longer in keeping with the times, and that cross-border solutions in keeping with EU legislation are called for instead.

"Only very recently, Greek market makers have frequently found themselves confronted with criminal proceedings, whereas the government's publicly listed OPAP company was free to maximize profits in the interests of shareholder value. This makes the Commission's decision to institute infringement proceedings all the more gratifying," said bwin Co-CEO Manfred Bodner.

The Austrian government has so far been unable to refute the Commission's accusations in the infringement proceedings against Austria. They have therefore been obliged to assure the Commission that appropriate amendments will be made to its gaming laws with respect to the discrimination of foreign gamers and advertising restrictions for non-Austrian providers.

If Austria fails to implement these amendments within the next few months, this would be in blatant infringement of European legislation, and the Commission would continue its formal infringement proceedings by initiating the second stage.

This concession by the Austrian government shows that members states are aware that national gaming monopolies are not compatible with European law, and cannot therefore be sustained in the long term. This represents a positive step towards a modern, competitive legislative framework for cross-border gaming.

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