France expects first online betting permits in 2009

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By Chrystel Boulet-Euchin Fri Jun 6, 1:24 PM ET

PARIS (Reuters) - France will begin issuing authorization for online betting operators from the second half of 2009 after agreeing with the European Union to open up the market, Budget Minister Eric Woerth said on Friday.
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The comments follow a meeting between Woerth and Internal Markets Commissioner Charlie McCreevy this week to discuss proposals that would avert court action against France by the EU over restrictions on online gambling.

Brussels has given France a final warning to change its gaming rules or be taken to the European Court of Justice.

"Being realistic, we're beginning a controlled opening up of online betting, which we have presented to the European Commission," Woerth told reporters.

France has agreed a "controlled opening" of its gaming sector, which is composed of two monopolies -- PMU for horse racing and Francaise des Jeux for lotteries.

But EU authorities are still waiting for detailed provisions before making a final decision on suspending legal proceedings.

Woerth said the government would seek to preserve its share of revenues from the gambling sector, which he put at 5.3 billion euros ($8.27 billion), but he said there was no alternative to meeting EU demands.

"Proceedings against France for our monopoly as regards online betting have been open since June 2007. In these circumstances, either we dig in our heels or we change our position," he said.

He said a law would be presented in parliament after the summer break and a regulatory authority established by the beginning of next year. The first approvals should be issued in the second half of 2009.

"Regarding horse racing, only parimutuel betting will be allowed," Woerth said, referring to the system in which the total sum bet on a race is placed in a pool and the final prize is not set until all bets are placed.

"For other forms of sports betting, we will hold discussions with leagues and federations. There, we will not have parimutuel betting but fixed odds betting," he said, referring to a system in which the prize is agreed before bets are placed.

"We also want to open up casino games like poker but also roulette or black jack," he said.

Woerth said licenses would require minors to be prevented from betting and would contain strong protection for gamblers given the risk of addiction, as well as restrictions on advertising and controls against money laundering.

The European Union's top court, the European Court of Justice, has ruled that gaming firms registered in one EU state must be allowed to operate across the 27-nation bloc unless there is an overriding national public interest not to do so.

Free movement of services is enshrined in the EU treaty, but Paris has refused to grant licenses to private operators, saying there was a need to protect consumers and stop online fraud.

(Writing by James Mackenzie; editing by Stephen Nisbet)
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