CJEU advocate questions legality of online gambling law

Issues

Maciej Szpunar, an advocate general of the Court of Justice of the European Union (CJEU), has criticized online gambling laws in Hungary, saying they may be in violation of the EU tenet of freedom to provide services, in an opinion delivered on April 5 posted on the case law website InfoCuria.

In the opinion, Szpunar was responding to a request for a preliminary ruling from the Budapest Administrative and Labor Court in the case of Unibet International Ltd. vs. Hungaryʼs National Tax and Customs Administration (NAV). In the case, Malta-registered online gaming service provider Unibet is contesting decisions the Hungarian authorities have made blocking its operations in the country by citing unlicensed activity.

In order to provide online gaming services in Hungary, a company is required to register with NAV, according to recent changes to related law. According to Unibet, the distribution of licenses does not take place lawfully, and it has questioned the transparency of the process as a basis of its complaint. According to Unibet, local rules on licensing violate the principle of freedom to provide services enshrined in the Treaty on the Functioning of the European Union (TFEU), Hungarian news agency MTI reported.

“On the basis of the foregoing considerations, I propose that the Court answer the questions referred by the Fővárosi Közigazgatási és Munkaügyi Bíróság (Budapest Administrative and Labor Court, Hungary) as follows: Article 56 TFEU precludes national legislation such as that at issue in the main proceedings, that provides that an operator of online games of chance, legally established in another Member State, has the theoretical possibility of obtaining a license when that operator is, in fact, impeded from obtaining a license due to the system being either discriminatory or lacking the requirements of proportionality or transparency,” Szpunar writes in the conclusion of his opinion.

“An infringement of such a system by an economic operator cannot give rise to penalties. A lack of national implementing provisions has no bearing on these findings,” he adds.

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