Hungary criticised by CJEU due to licensing violations

According to the Court of Justice for the European Union (CJEU), Hungary’s licensing framework for online betting industry operates under unfair and restrictive conditions. This fact has prevented many major online betting sites from entering the country’s market.

Kindred Group, through their Unibet brand, brought the licensing complaints to CJEU, that decided that the Hungarian licensing regime is violating Article 56 of the Treaty on the Functioning of the European Union. According to this article states cannot disrupt cross-border services and trade.

Hungary updated their licensing framework in 2014.  According to it, local land based firms are allowed to apply for online licenses, while at the same time online sports betting could only be offered by Szerencsejáték Zrt (state run monopoly).

Hungarian lawmakers decided that foreign licensed sites would be branded as “trustworthy” only if they had operated within the country, during the last 10 years.

These above reasons led to international bookmakers complaining that the framework is clearly benefiting domestic operators. They also went forward to declare that the provisions were drafted in an unclear manner.

Maarten Haijer, Secretary General of the European Betting and Gaming Association, said about the court’s decision: “The Court reiterated that member states must guarantee that national regulation on online gambling services meets objective, transparent, non-discriminatory and proportionate criteria. Only a properly regulated and transparent online gambling market can ensure that the consumer is channelled to the regulated offer. The Court’s ruling is a clear message to other gaming authorities, including the Dutch Gaming Authority, that they must not enforce regulation that does not comply with basic EU law. We expect these member states to reconsider and lift these enforcement measures as they are acting in violation of EU law. Their actions do not serve the interest of consumers, they fail to channel the consumers to reliable providers, instead they merely prop up failed regulation”.