REGULATION AND LICENSING FOR DANISH ONLINE GAMBLING MARKET (Update)

2 May 2008

Speculation appears to be based on firm information


The wide speculation last week that the Danish government may be changing its policy toward online gambling (see previous InfoPowa reports) has to some extent been confirmed this week by many media reports that regulation and licensing is now being seriously considered.

The Danish minister for taxation, Kristian Jensen, told the Danish national radio that the government was preparing to open up its previously monopolistic system in order to strictly regulate and licence suitable online gambling companies after months of pressure from the European Commission.

This week the Danish media examined the turnaround, reporting that Danes who like placing bets on sports and online poker might soon have even more – legal – options, when deciding where and on what they want to bet. Reports claim that Jensen is leading the development and has started an investigation into how the Danish state monopoly might be changed.

This could lead to a development where foreign companies would be able to offer products and advertise gambling in Denmark. The reports recap the present policy in Denmark, where it is currently illegal for foreign companies to market their products. However, should the government change policy, these companies will be able to set up in the country and compete with Danske Spil offerings.

The minister is quoted as saying: ”That’s a possible situation, if the foreign bookmakers can live up to the strict regulations we have (in mind) for those who want to offer legal gambling in Denmark. I do not wish any wild west situation. I want a regulated market."

According to Jensen at least part of the development is due to the current difficulty of controlling where people gamble. Danes are gambling, no matter what the law tells them to do, on the Internet where they can frequent a wide selection of foreign bookmakers outside the financial control of the Danish government.

The initial liberalisation of the Danish market will apparently first target the legalisation of knowledge games, bookmaking and other similar Internet games - but the really big game - Lotto - will not be included. Jensen says that whilst foreign companies are mainly interested in the sportsbetting services, the Lotto will remain under Danish control because that is the only way to keep a decent prize pool.

Asked what role EU pressure has played in the decision to libralise, the minister opined that although he believed the government would be able to win any EU trials that may come, it cannot stop the reality, which is that Danes gamble at several online casinos, poker rooms and bookmakers.

If the state monopoly is ending, foreign companies will most likely have to pay for a licence if they want to sell their games in Denmark. This will secure funds to replace the current income from the state monopoly - essential for the young peoples' sport clubs, political youth organisations and numerous other entities that currently are beneficiaries the Danish state monopoly earnings.

"We owe it to the millions who currently get a share from the state monopoly's revenue to investigate how we can keep gambling regulated and how we can use the profit to support the communities and organizations who currently depend on funds from the monopoly," said the tax minister.

The Danish state monopoly Danske Spil last year generated revenues of 11.2 billion Danish kroner. Of this 1.65 billion Danish kroner went to the ”tipsmidler ” a fund that supports organisations, and 1.1 billion kroner wwent to the state tax treasury.

Online Casino News courtesy of InfoPowa