Jake Pollard reports that an amendment introduced over the weekend will kick off the regulatory process that could see the last major western European market regulate its online casino sector.   

The French government introduced an amendment over the weekend to regulate online casino and has set in motion the process that could see France become a regulated iCasino market, but the regulatory format that has been outlined has led the country’s land-based casinos to say that it is “tantamount to signing their death warrant”.

The amendment paves the way for the legalisation of the vertical, which stakeholders have been calling for for many years, and, if passed, would see France become the last major western European market to host a legal and licensed online casino sector.

With new Prime Minister Michel Barnier seeking to raise revenues to address the country’s debt levels, which currently stand at 112% of its gross domestic product while its public deficit is at 5.5% of GDP and nearly double the 3% level imposed on EU Member States, the amendment will be debated as part of the country’s 2025 budget in the coming months. If passed, there could be regulated online casino in France by the middle of next year.

GGR tax and open competition 

The amendment states that a levy on online casinos’ gross gaming revenues of 27,8% will be introduced as part of the measures, but, with the government also looking to increase taxes on all of the country’s gambling verticals as part of a drive to raise €500m for the country’s social security coffers, tax levels on regulated iCasino would reach 55.6% of operators’ GGR, the same overall tax level that applies to lottery products.

Importantly, the document also states that the purpose of “the amendment is to authorise and open up the online casino gaming market to competition by defining the tax framework applicable to this type of gaming”, meaning a market open to operators of all types as long as they meet compliance and licensing requirements.

This outline has already been strongly criticised by Casinos de France, the trade body representing the country’s 200 land-based casinos. Reacting to the amendment, Grégory Rabuel, President of CdF and CEO of Barrière Groupe, told Les Echos that the move was “a totally ill-considered decision, without any consultation with stakeholders”.

Recall, as part of its JADE proposal, CdF called for physical casinos to be allowed to operate digital casinos during an initial three-year exclusivity period.

“Opening up online casinos to competition will lead to a 20-30% drop in GGR for land-based casinos and the closure of 30% of establishments,” added Rabuel. “This will have catastrophic consequences, particularly in social terms: it is estimated that 15,000 jobs will be lost. More generally, this is tantamount to signing the death warrant for land-based casinos.”

The government’s text said the lack of regulated online casino had led to the “development of a significant illegal offer in recent years” estimated to be worth between €748m and €1.5bn, while government sources have estimated that the tax revenues generated by iCasino regulation could reach €1bn.

However, in his interview with Les Echos, CdF President Rabuel said the measures will lead to the government losing around €450m in tax revenues from the country’s physical casinos, with the smallest communes most badly hit. He called for French MPs and senators to reject the amendment and renewed his call for land-based casinos to be granted exclusive right to operate online casinos.

The vertical being regulated according to the framework set out by the government would represent a major win for France’s online operators such as Betclic, Winamax and Française des Jeux, which now includes Kindred Group’s Unibet sportsbook along with its 32Red and Maria Casino brands, which have called for an open market environment for many years.

The speed at which the amendment has been introduced has caused some surprise, but, in common with other European economies, France is looking to raise revenues and cut costs, while Prime Minister Barnier gained some experience of dealing with gambling-related issues in his role as European Commissioner and then Vice-President in charge of Internal Market and Services from 2010 to 2014.

ANJ clampdown on unregulated operators

News of the amendment follows a recent campaign by the Autorité Nationale des Jeux (ANJ) to combat illegal gambling and aggressive and lengthy investigations by ANJ into the online casinos currently targeting the market.

The regulator’s teams have been focusing their efforts on uncovering the ultimate beneficial owners (UBOs) of the websites and have been in regular contact with counterparts in Curaçao, where many of the sites are licensed, as part of its efforts to reform its iGaming laws.

Since the pandemic, the jurisdiction has been under pressure from the Netherlands to toughen its regulatory set up and with ANJ President Isabelle Falque-Pierrotin also presiding over the Gaming Regulators’ European Forum, EU lawmakers have discussed the issue on many occasions.

SBC understands that the unregulated operators are now turning their attention to getting licensed in Vanuatu, with the Tobique First Nation in New Brunswick, Canada, and in the Seychelles.

In addition, Google France has banned SEO referencing for online casino search terms and ANJ is also understood to be pressuring payment, infrastructure and iGaming software providers to stop them supplying the unlicensed operators.

Source