Thursday, 20 April 2023

GAMBLING ADVERTISING. BETWEEN LEGALITY AND ILLEGALITY 1ac3n

by Vidrean – Căpușan Tudor Dumitru Lawyer, PhD Assistant Professor “Babeș – Bolyai” University, Faculty of European Studies a381y

I propose a quick and eloquent foray into the European vision of the advertising of products and services consumed within the European Union. It all stems from the growing intention of Romanian politicians to ban gambling advertising in our country. If you read the following article, you will see that the European principles are different and are aimed in particular at protecting the principle of freedom to provide services and protecting consumers of all kinds, not by prohibition, but by legislative measures to correct legislative shortcomings identified over time and by offering transitional periods for adaptation and even compensation to economic operators if the measures taken by the national authorities reduce their income. 3lj48

Gambling is a sensitive area that generates complex discussions, especially in relation to the morality of a measure that allows gambling to be organized and carried out. Within the European Union, gambling has been and is seen as an area of competence that represents the fiefdom of the Member States. In a previous article[1], we pointed out that there is no regulation at EU level in the field of gambling, especially as Member States have been extremely reluctant to relinquish their competences at EU level.

This is why the European Union has only intervened through soft law regulations or through the rulings of the Court of Justice of the European Union, which aimed to protect the proper functioning of the 4 fundamental freedoms. In this context, it is questioned to what extent European law can effectively protect gambling operators against populist and electoral measures announced by Romanian parliamentarians.

It is well known that a group of Romanian MPs proposed, during November 2022[2], an amendment to the gambling and audiovisual legislation, in order to prohibit the use of any form of advertising (street, online, audio – TV) by gambling operators. In other words, this regulation aims, indirectly, to dismantle an entire industry of the national economy and completely eliminate gambling from Romania’s economy, a situation reminiscent of the communist period.

Following the debate on the draft in the Senate Chamber, small amendments were made to the effect that advertising should be allowed online and audio-video advertising should be allowed only during the night (between 23.00 and 06.00) and street advertising should not exceed 30 m2. The final vote is to be taken by the Chamber of Deputies as the decision-making body. Even if the form voted in the Romanian Senate enters into force, we believe that certain specific criticisms should be made.

As I was saying, the European Union’s intervention has taken the form of soft-law regulations, such as, for example, the Recommendation on the principles for the protection of gamblers and on the prevention of access to gambling by minors[3]. Reading this document does not reveal at all that the protection of gamblers and minors is achieved through measures to annihilate the gambling industry. As such, it can be seen that the legislative measures proposed in the Romanian Parliament are contrary to this European-level regulation.

Moreover, a reading of the provisions of Art. 10 para. (3) of GEO no. 77/2009 on gambling reveals that it has transposed the principles of the aforementioned Recommendation. As such, we do not see the need for a legislative change in the field of advertising when the principles of the European Recommendation are already implemented in Romanian legislation.

A second criticism stems from the principles arising from the Berlington Hungary affair[4]. In this case, the CJEU was seized of the issue of the total prohibition of slot machine games outside casinos by Hungarian gambling legislation. The same legislation also provided for a five-fold increase in the tax for the operation of slot-machine games inside casinos on an untimely basis.

The CJEU criticized both Hungarian legislative solutions as follows. With regard to the total ban on slot-machine games outside casinos, the European court pointed out that a total ban on an activity is contrary to the principle of freedom to provide services. Moreover, such a measure would put Romanian economic operators at a disadvantage because Romanian consumers will turn to gambling in other Member States, where gambling advertising is much more permissive. We consider it absurd for a state, through the measures it adopts, to disadvantage its own citizens and national economic operators to the detriment of competition from other states, which is a totally negative first for a European state.

Also, with regard to the five times higher tax for operating inside casinos, the Luxembourg court pointed out that the Hungarian state must provide a transitional period for gambling operators to adapt to these new measures, especially as this will generate a significant drop in revenue in a context where gambling operators have made significant investments. A compensation mechanism was also required for the loss of income in question, the Luxembourg court added.

Applying these principles in relation to the envisaged regulation of advertising, we wish to show that a total ban on advertising is clearly contrary to European law. With regard to the measures in the form adopted by the Senate, we believe that they must provide a transitional period for adaptation, as well as compensation for gambling operators, given that such a measure will certainly reduce their revenues, in order to comply with the principles of European regulations.

In conclusion, our assessment is that it is necessary to put constant pressure on decision-makers (by formulating petitions and memoranda, legal actions) to force the Romanian legislator to respect the principles of European law, which are nothing other than the principles of a real market economy specific to a real democracy and a genuine rule of law.