Ladbrokes Loses De Lotto Appea

The Dutch Court of Appeals in Arnhem ruled Tuesday in favor of state-run Dutch lottery operator De Lotto. The decision states that without a license Ladbrokes may not offer bets to Dutch citizens and must therefore block their access to its Internet and telephone services.

"This is the fatal blow to the illegal provision of gambling sites in The Netherlands." - Rob Tjeerd Veenstra De Lotto

Ladbrokes has argued that the Dutch laws on which the prohibition is based violate the free movement of services within the European Union and believes it has a fundamental right to offer services across borders, just like any other industry such as banking, food, etc. But the court has held that that the laws do not violate any E.U. codes because they are based on social interests like preventing gambling addiction and fraud.

The Court of Appeals has denied Ladbrokes' request have the case transferred to the European Court of Justice in Luxembourg.

A district court in Arnhem also found in favor of De Lotto in January, and although more hearings are scheduled and Ladbrokes may still appeal this decision to the Supreme Court, the latest ruling is considered by many to be a deathblow to Ladbrokes and other foreign operators.

De Lotto and Holland Casino, Holland's licensed gaming companies, have so far begun lawsuits against several foreign operators that offer bets to Dutch residents. The Ladbrokes decision, however, is the first to come from such a high court. All other courts have also found in favor of De Lotto and Holland Casinos, ruling that foreign operators must block access to players in the Netherlands.

De Lotto's director Tjeerd Veenstra said, "This is the fatal blow to the illegal provision of gambling sites in The Netherlands."

De Lotto's attorney, Joris van Manen, reacted similarly. "We of course are very pleased with the judgment, which is quite important because we had settlements with a lot of parties offering Internet gaming," he said. "The agreement was that they would shut the site down for Dutch users until the decision was rendered in the Ladbrokes case. And it will be a long time before any other decision will be rendered because if Ladbrokes goes to the Supreme Court it will take three to four years, and if they go further into full scale court proceedings it will take some years, especially since they want the case to be referred to the European Court of Justice in Luxembourg."

Ladbrokes is considering all of its options, but is determined to take the case to the European Court of Justice. It can do this either by bringing this recent judgment to the Supreme Court of the Netherlands or by continuing the full-scale court proceedings, which started a few months ago.

A similar case is pending before the European Court of Justice. British bookmaker Stanley International Betting is engaged in a proceeding with Italian bookmaker Piergiorgio Gambelli. The Advocate General has given his opinion that Italian legislation concerning sports betting constitutes a non-justified obstacle to Stanley's freedom to provide services throughout the European Union.

Whether the Court of Justice will follow the opinion of the Advocate General remains to be seen. In three other cases, the European Court of Justice has ruled that national governments have the right to regulate their own gaming markets and to issue only a limited amount of gaming licenses as long as the legislation is intended to serve social interests like preventing gambling addiction and fraud.

Meanwhile, Ladbrokes is also engaged in a dispute against the Finnish government, which would like to block all of its attempts to market its services within the country, and in Germany one of the authorized betting organizations has recently brought Ladbrokes before the courts in a similar matter.