A recent court ruling has raised significant questions about the Dutch lottery monopoly. It was revealed that two businesses, Jack's Casino and Jacks.nl, both owned by JVH Gaming, had their applications for instant lottery, sports betting, and lottery licenses rejected by the KSA on September 4, 2022. Although the KSA did not publicly name these businesses in its ruling, Dutch newspaper Brabants Dagblad identified them.
The KSA defended its decision by stating that a license had already been granted to Nederlandse Loterij and that licensing could only be issued to one entity under the current monopoly policy. They argued that the Netherlands' gambling policy was “horizontally consistent.” However, the claimants challenged this assertion, pointing out that the policy has been inconsistent since the Remote Gambling Act (KOA) came into effect in October 2021.
They referenced two previous court rulings: one from May 2, 2018, which upheld the monopoly over sports competitions and instant lotteries, and another from March 10, 2021, which ruled that it was acceptable to continue the lottery's monopoly while allowing permits for charitable lotteries.
In assessing the claimants' arguments, the court concurred that the KOA did not align with Article 56 of the Treaty on the Functioning of the European Union (TFEU), which prohibits restrictions on the provision of services within EU member states. The court concluded that the current state of Dutch gambling policy is “no longer horizontally consistent.”
The ruling noted that the existing gambling framework involves a single license system for land-based gaming, which presents a lower risk of addiction and crime, whereas the system for online gambling, which carries greater risks, operates under an open licensing system. The court identified this inconsistency as problematic given the recent legal developments following the KOA's implementation.
Additionally, the court found that a monopoly system was not necessary for safeguarding public interests related to gambling, such as consumer protection. The decision highlighted the lack of justification for preventing operators from offering services unless under a monopoly arrangement, citing that doing so does not systematically secure the overarching objectives.
As a result, the KSA was deemed unjustified in denying the license applications based on the existing monopoly held by Nederlandse Loterij. The regulator is now required to review the two applications again within the next 12 weeks. Recognizing the significant implications of this ruling, the court commented that it could dramatically affect licensing for the organization of country-based games of chance.
The KSA is also responsible for paying €1,750 in court costs to the two claimants, in addition to the €365 court fee.
Currently, Nederlandse Loterij holds all three available monopoly licenses for its three segments: Krasloten, Toto, and Lotto.
Justin Franssen, an attorney at the gambling law firm Kalff Katz and Franssen, remarked that this ruling was a predictable outcome following the introduction of online gaming in the Netherlands. He described the judgment as a “logical consequence” of opening the remote gaming market and pointed to an ongoing series of legal precedents leading to this decision.
Franssen noted that the current structure of exclusive licenses for certain land-based gaming activities complicates the situation, particularly when there are unlimited licenses available for remote gambling. He anticipates that this decision will influence ongoing discussions surrounding the future of the Nederlandse Loterij monopoly and the possible privatization of the NLO. He also expects increased competition in the land-based sports betting market, which could benefit the Dutch arcade sector through product diversification and modernization.
