Gambling Industry Regulation in the News — Weekly Round-up for November 16, 2018

By Brian Cullingworth, Last updated Nov 8, 2022

Regulators Unite To Analyse Blurred Lines Between Social And Video Games With Gambling

Declaration signed at Gambling Regulators European Forum (GREF)

Regulators from 18 European and American jurisdictions have signed a declaration on the blurred line between gambling and video/social games.

Regulators from Latvia, Czech Republic, Isle of Man, France, Spain, Malta, Jersey, Gibraltar, Ireland, Portugal, Norway, Netherlands, United Kingdom, Poland, Austria, Washington, Denmark and Finland agreed to collaborate after sharing their concerns on the risks associated with other digital entertainment such as video and social games.

Part of the agreement will see a combined effort in thoroughly analysing the characteristics of video games and social games which will enable informed and constructive dialogue with representatives of the video and social game industry.

“Concerns in this area have manifested themselves in controversies relating to skin betting, loot boxes, social casino gaming and the use of gambling themed content within video games available to children,” the declaration reads.

“Regulators identify, in such emerging gaming products and services, similar characteristics to those that led our respective legal frameworks and authorities to provide for the regulation of online gambling.

“We anticipate that it will be in the interest of these companies whose platforms or games are prompting concern, to engage with [gambling] regulatory authorities to develop possible solutions.”

Participating regulators believe this joint action will raise parental and consumer awareness regarding the transition and differentiation between gaming for leisure and entertainment and gambling.

Belgium Warned On New Advertising Restrictions

Industry cautions that severe restrictions on gambling advertising could drive players to illegal operators

The gambling industry in Belgium has reacted to new restrictions on advertising approved by the Belgiian government, warning that these may drive punters to illegal and unlicensed operators.

After mulling the gambling advertising situation for a year, lawmakers led by Justice Minister Koen Geens pushed the restrictions through parliament and, according to a government update this (November) month, the new restrictions will be implemented.

These include a complete ban on all online casino television advertising, a requirement that gambling adverts include problem gambling warnings, and a tighter digital advertising framework for online casino operators requiring them to promote their product only on government-approved websites with restricted messaging.

On the sports betting and advertising front, an 8pm TV watershed on sports betting advertising is to implemented, with no marketing coverage allowed during live sports broadcasts, whilst there is likely to be a ban on celebrity or athlete endorsements of gambling products and services.

The online industry in Belgium continues to protest that government legislation is increasingly leaning towards favouring the land-based industry, and the new restrictions will do little to dispel that perception.

DGOJ Strengthens Player Protection

Operators will require documentary verification of identity

Spain’s gambling regulator Dirección General de Ordenación del Juego (DGOJ) has adopted three new resolutions, in force from March 30, 2019, with a view to strengthening player protections.

“By resolution of October 31, 2018 of the Dirección General de Ordenación del Juego, three resolutions on the game set forth in Law 13/2011 on Game Regulation related to identity verification are modified, the data model of the monitoring system and the development of the technical specifications of the game, traceability and security that the technical gaming systems must fulfill,” the advisory reads.

One of the new resolutions adopted by the DGOJ is a requirement for operators to modify user registration fields with the inclusion of an IP from point of connection, the type of device used and the ID of the device to prevent “impersonations”.

Another is designed to complement existing identity verification processes with the addition of documentary ID verification which the DGOJ says will protect consumers rights, minimise identity theft and strengthen the fight against fraud and money laundering.

Customers who have not been validated and their identity documents verified, will be unable to play. Customers whose identity has been verified but documentary verification is outstanding will be able to play to a joint deposit limit of Euro 150. They will, however, not be able to withdraw winnings until the necessary documentation has been received and verified.

A nine-month transition period will take effect as of March 30, 2019 for previously registered players who will need to undergo the additional documentary verification process.

In addition a resolution on technical game specifications, in particular random number generators (RNG) requirements will also come into force on March 30, 2019.

Considered a substantial change in the technical gaming specifications, RNG’s will need to be certified as cryptographically strong. Its implementation will require the prior authorisation of the DGOJ within nine months of the entry into force of the resolution.

Spanish Players To Be Checked Against Death Registry

In new identity verification measures

Spain’s gambling authority, Dirección General de Ordenación del Juego (DGOJ) has extended the features of its Player Verification Services to incorporate Verification of Registration in the RGIAJ (SV-RGIAJ), a new facility that will enable gaming operators to compare the DNI / NIE of players with persons identified as deceased (SV-DIF) in the Civil Registry of the Ministry of Justice.

The initiative, which has been launched in collaboration with the Ministry of Territorial Policy and Public Function and the Ministry of Justice, will strengthen anti-identity theft measures.

Existing registration procedures require operators confirm identification data provided by a prospective customer with the DGOJ, who together with information provided by the Ministry of the Interior, confirms personal information and age verification.

Operators are then obliged to verify if the prospective customer is registered in the national gambling register with the Verificación de Inscripción en el RGIAJ (SV-RGIAJ). The DGOJ by matter of course informs operators of new registrations in the RGIAJ.

The additional checks against the Civil Registry of deceased persons forms an additional layer in the process.

Swedish Court Rejects Offshore Linking Challenge

Media houses and domain owners ordered to discontinue links to offshore lotteries

Sweden’s Linköping Adminstrative Court has rejected an appeal brought by twelve domain holders challenging injunctions served by the gambling authority Lotteriinspektionen.

The appeal revolved around the gambling authority’s decision to ban Swedish domains providing links to offshore lotteries. In May 2018, Lotterinspectionen served injunctions against 39 internet domain owners ordering they cease promoting participation in offshore lotteries.

The Court upheld Lotteriinspektionen’s action finding that its actions were in accordance with the Constitution and did not violate European Union law.

The twelve domain holders who lost the appeal were: Sörmlands Media AB, Norrköpings Tidning Media AB, Svenska Dagbladet AB, Skellefteå AIK Hockey, Norra Västerbotten Newspaper Company, Stampen Local Media AB, Herenco I.T. AB, Hall Media AB, Norrköping Tidning’s Limited Company, Östgöta Media AB, AB Laholms Tidning, MittMedia AB

Third quarter market results released by the inspectorate showed annual growth in the Swedish gambling market of 1.2 percent, driven primarily by unlicensed operators according to figures supplied by H2 Gambling Capital.

Swedish licensed operators reported gross gaming revenue of SEK 12.2 billion, down 2.4 percent, while unlicensed operators held a 27 percent market share with gross gaming revenues reaching SEK 4.5 billion, up 12.4 percent.

Overall, online gambling grew 12.9 percent while land-based gambling declined 8.4 percent. Online growth was boosted by 13.6 percent and 11.9 percent growth in online sports betting and casino respectively.

A similar trend was reported by major operators. Svenska Spel reported gross gaming revenue of SEK 6.4 billion, down 1.6 percent. Land-based gambling fell 9.4 percent while online gambling increased 22.5 percent.

Another prominent operator ATG reported gross gaming revenue of SEK 3.1 billion, down 0.4 percent. Land-based gambling decreased by 10.0 percent while online gambling increased by 6.7 percent.

Curacao Central Bank To Intervene Following Illegal Online Gambling Case

Carmanco NV trust office may have been in trouble once too often

The Central Bank of Curaçao and Sint Maarten (CBCS) has confirmed to local newspaper the Curacao Chronicle that it is ‘taking the necessary measures’ against the Carmanco NV trust office, which has apparently once again fallen foul of the Dutch gambling authorities in regard to illegal online gambling.

Carmanco is a subsidiary of Curaçao Trust Management NV, which holds a licence from the central bank to offer trust services, and the current issue is believed to involve a hefty Euro 350,000 fine recently imposed on Curaçao-based Cyberrock NV by the Dutch Gaming Authority (KSA).

The Chronicle notes that this is not the first time that Carmanco has been penalised by the Dutch gaming authorities for facilitating an operator engaged in illegal activity, and that in 2015, Carmanco director George Praag received an official warning from the KSA and pledged to improve the company’s performance.

Carmanco was reportedly also convicted in another case by a judge in Willemstad earlier this year for ‘improper management’ and ‘seriously blameworthy and therefore unlawful action’.

“Under the CBCS Policy Rule on Integral Operations in Incidents and Integrity-Sensitive Functions, a supervised institution must inform the Bank of its own accord and without delay about incidents that have occurred. The Bank has taken note of the information regarding Carmanco N.V., an entity that provides management services under the responsibility of a license holder and will take the necessary measures “, a spokesman advised the Chronicle in an official central bank statement.

Weighing in on the issue, the Dutch regulator told the newspaper: “It seems indeed that Carmanco does not follow the promise made earlier. This is a bad thing for Dutch consumers in particular. They are now not protected. The KSA is considering other steps.

“In the past, the KSA strongly advised trust offices to reflect on their services to gambling companies. This advice is still valid. The KSA has good contacts with the competent authorities in Curaçao. “We aim to work together in the future against illegal online gambling.”

Brian Cullingworth

Infopowa news was a staple of Casinomeister’s news from 2000 until 2019. Brian Cullingworth was the main writer, contributor, and was one of the most knowledgeable persons I have ever known involved in the online casino industry.

We first met in January 2001 at the ICE in London where I observed him going booth to booth interviewing online casino, software, and licensing jurisdiction representatives. Brian was also heavily involved with our forum as “Jetset“, he was involved as an informal consultant to eCOGRA, the OPA, and was a player advocate who assisted countless aggrieved players with his connections to industry folks. He also published “Casino Cautions” via Infopowa news for quite a number of years. These can be found in our news archives.

His passing in February 2019 was a dark day for us. He will be forever missed.

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