EU: Commission recommends principles to Member States to promote effective protection of consumers

by DLA Piper

On Monday 14th July, the European Commission issued its Recommendation for the principles that Member States should consider adopting for the further protection of the consumers of online gambling services.

In 2011, the Commission adopted a ‘Green Paper on online gambling in the Internal Market.’ Its purpose was to obtain facts and information about the EU online gambling market and of the different national regulatory systems in place at the time.

In 2012, the Commission adopted the Communication ‘Towards a comprehensive European framework for online gambling’ which sought to identify ways to address some of the key challenges faced by the online gambling industry.

The new Recommendation is designed to promote a harmonised level of protection for all people living in EU Member States, particularly to prevent gambling addiction, which now affects up to 0.8% of the adult population, and to stop minors from using online gambling services, particularly as the growing usage of technology means that young people are exposed to online gambling more frequently.

The inconsistency shown by Member States in the way they regulate online gambling continues to cost the industry dearly as it faces multi-jurisdictional regulation. As this takes its toll, businesses choose to focus on fewer territories, with customer choice suffering as a result.

A Recommendation is a non-binding act, meaning Member States are not obliged to follow it. However, a Recommendation does carry political weight and sends a clear message to Member States about what action they would ideally take.

The key elements of the Recommendation

  • Operators should provide various means of contact on their website and should include warnings against underage gambling and provide information to assist those players potentially facing gambling disorders. The terms, conditions and information about the games that are available should be easily accessible to the consumer.
  • Safeguards should be put in place to prevent minors from accessing gambling services. For example, websites should perform age restriction checks, and provide links to parental control programmes on their website. Member States should minimise minors’ contact with gambling through advertising.
  • Players should register with verifiable personal details, so operators can check player activity and take action if necessary.
  • Players should be able to control monetary deposit limits, check their balance and receive alerts about winnings and losses. They should not be able to exceed their monetary deposit limit within a stated time limit, or to gamble if they do not have sufficient funds to cover their spending.
  • “Time-out” facilities should be available to allow players to suspend gambling for at least 24 hours, whereas self-exclusion should suspend gambling for at least six months. Member States should create a national registry of self-excluded players, and operators should consult these registries to prevent self-excluded players from continuing to gamble. The European Parliament previously requested the Commission to consider interoperability between national self-exclusion registers in 2013 and this seems to be a recurring theme.
  • Commercial communications about online gambling should carry warnings about potential health risks and should not make gambling appear as a solution to personal or financial difficulty or an alternative to employment. Sponsorship by operators should be transparent.
  • Member States are encouraged to make vulnerable groups aware of the risks of online gambling and operators should train their employees (with direct contact with players) such that they understand the possible harm of online gambling and are equipped with the ability to respond to signs that players may require assistance or information.

The Recommendation invites Member States to notify the Commission about the actions they have taken and to do so within 18 months of its publication. After 24 months, the Member States are requested to communicate statistical data about the numbers of: active gambling accounts, self-excluded players, people suffering from gambling disorders and breaches of the principals. The Commission will then assess the actions taken by Member States within 30 months of the Recommendation’s publication.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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