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Home In-depth Europe's Digital Markets and Services Acts and the gambling industry's place in them

Europe's Digital Markets and Services Acts and the gambling industry's place in them

ANALYSES 27 Jul 2022
6 min. read

European flag flying in the wind.

The European Union may often appear, to the untrained eye, a ragtag band of lawmakers who are constantly at odds without actually pushing any meaningful changes onto the average European. And yet, the European Union has been one of the most successful projects in securing prosperity, peace, and economic opportunities for its Member States, and often for countries beyond its own borders.

The arrival of the General Data Protection Regulation (GDPR) on May 25, 2018, completely transformed our understanding of data laws and protection of personal information in what could be hailed as one of the union’s most notable achievements that has been replicated worldwide. As societies continue to digitalize, a more robust regulatory framework is necessary to ensure that consumer rights are protected.

Once again, the European Union is a trailblazer and a pioneer with the establishment of a pair of legislations, the Digital Services Act and the Digital Markets Act, designed to ensure fair and open digital markets. In it, citizens and online platforms become powerful gatekeepers of lawfulness, ensuring that illegal content across different realms of the digital experience is addressed swiftly and without hesitation. The twin legislations have been hailed by the gambling industry and by all European trade bodies representing the industry.

Why Are DSA and DMA Important for the Gambling Industry?

The grey market in the European regulated gambling industry has continued to persist despite the efforts of the local government and even the European Commission. The new regulatory changes, though, intend to ensure that rogue operators in the gambling space are exposed and quickly acted against thanks to the implementation of two core concepts.

The first one is an improved "notice-and-action mechanism" that seeks to ensure that illegal and misleading content is quickly discovered and submitted for review. This form of regulation is not designed as a way to suppress online content, but rather to offer transparency and clarity. Big gateway technological platforms will have to step up and ensure that they provide genuine information and flag marketing messages and promotions.

The regulated gambling industry has hailed this as a milestone achievement as it hopes to see the notice-and-action mechanism empower consumers and let them notify authorities about illegal gambling content that appears on the platform. Moving forward the European Union wants to use a "trusted flagger" mechanism that will enable relevant authorities to address notices from trusted parties about illegal content in the gambling industry (but also in all other walks of digital life) and elicit the appropriate response from relevant parties.

Essentially, the regulated gambling markets want to see more done to address the spread of illegal gambling content which has continued to plague even Europe’s best-regulated jurisdictions.

European Lotteries Embrace DSA and Its Stated Goals

The response has naturally been met with overwhelming positivity. A host of bodies vowed their support for the new changes early in 2022 and stated that the proposed framework by the European Commission sought to create a more secure environment for all. La Française des Jeux Head of Regulatory & Policy Officer Frédéric Deroin welcomed the opportunity and hailed the notice-and-action mechanism as well as the commitment to make it a priority to fight illegal activities and content.

He said that by allowing anyone to contribute, the industry would be able to fight back against rogue operators. OPAP Greece International Relations Manager Dimitra Voulgari said that the concept was solid, but it would also rely on those so-called trusted flaggers to move quickly and without delay when seeking to notify about issues pertaining to illegal gambling content for example.

Voulgari said that the DSA could enable the European Lotteries trade bodies and national lotteries to fight harder against illegal gambling content. Finland’s Veikkaus and Senior Consultant on EU Affairs Petri Lahesmaa welcomed the opportunity and said that the DSA would pave the way for the European Union to rectify the situation with bad actors that continue to flout Article 5 of the Electronic Commerce Directive and seldom suffer any regulatory response because of that. Distributors of illegal gambling websites will finally be brought to accountability, Lahesmaa said.

Protecting Consumers and Ensuring the Operation of the Regulated Market

The European Gaming & Betting Association offered its support for the Digital Services Act, arguing that it was a step in the right direction and one that will guarantee the further protection of European consumers.

Illegal advertisement and promotional marketing messages targeting minors have been some of the issues that the DSA now stands to address in full. EGBA urged for any advertisement to be conducted in a socially responsible way and argued that the European Commission’s efforts to create a safer online environment for citizens were supported by the organization, as per the words of EGBA Secretary General Maarten Haijer.

European Casino Association Chairman Per Jaldung was among the executives to express their support for the new legislation and the positive impact it would have on broader consumer protection as well as the gambling industry. He said:

"By bringing together our voices, we can provide key support in protecting consumers across Europe. Additionally, we fully embrace the Digital Services Act package, which represents a critical step to deal with this particular social scourge [illegal gambling]."

Jaldung stressed the importance of protecting vulnerable players and problem gamblers as the industry rallies behind a law designed to achieve this. ECA reminded that by allowing rogue operators to exist and not face legal action, the efforts of regulated market operators are also being undermined, reduced, and subsequently rendered ineffective, exposing consumers to vulnerabilities.

While the Digital Service Act and Digital Markets Act are pressing on, there are other regulatory changes that happen across Europe. The United Kingdom is in the review of its gambling laws and so is Curacao, a jurisdiction that has been known for its liberal laws and regulation in issuing licenses to operations.

The Digital Service Act will prove a new benchmark against which all regulated gambling companies will have to measure themselves. However, the issue here is not so much bringing regulated businesses into the fold, but rather creating an efficient framework that punishes wrongdoers and offenders who give the industry a bad reputation and cost consumers lives and financial ruin.

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27 Jul 2022
6 min. read
Comments (1)
3 weeks ago

Do you feel the idea of "trusted flaggers" and empowering consumers to report issues with content under the Digital Services Act and the Digital Markets Act would lead to a more efficient fight against rogue gambling operators who continue to target consumers in the European Union?