The Constitutional Court of the Czech Republic has ruled that the Magistrát of Prague (City Council) retains the right to apply specific gambling laws that reflect local conditions and allow individual city districts to ban or restrict live gambling independently.

The decision supports the separate gambling rights of municipal districts, highlighting the fundamental differences between the Czech government’s centralised approach to regulating land-based gambling venues.

In 2021, Prague established a ‘city ordinance’ banning all technical games (slot machines) throughout the city, while allowing live dealer games such as roulette and poker to continue within casino venues.

Each district was granted the authority to either restrict or completely ban live gambling activities. The 57 districts of Prague took different approaches: 41 districts banned live games entirely, while others opted to apply time restrictions on gambling venues.

In 2023, the Ministry of the Interior, together with the Czech Competition Authority, ruled that the regulations were inapplicable and discriminatory to gambling licence holders, calling on the City Council to terminate the rules. The ordinance was temporarily suspended by the Ministry, which deemed the rules to have violated national regulatory standards.

The Constitutional Court has now lifted the suspension, backing local lawmakers’ authority. Justice Pavel Šámalnoted that the Constitutional Court recognises the right of city districts to determine their own regulatory methods as both legitimate and rational.

The Ministry of the Interior had argued that Prague should implement uniform gambling rules across its entire economic territory, blaming the city for creating market distortion.

The Office for the Protection of Competition (ÚOHS) had previously found that the fragmented regulatory framework might violate competition laws, prompting a formal investigation. Prague officials maintained that their approach complies with Czech law, which grants municipalities the authority to develop gambling policies tailored to local needs.

The City of Prague presented valid reasons for differentiating between gambling operators, which the Court accepted as reasonable and non-discriminatory. The Court determined that the established restrictions met the requirements necessary to achieve regulatory objectives.

However, the decision was not unanimously supported. Justice Milan Hulmák expressed dissent in a written opinion, challenging the rationale behind Prague’s irregular distribution of live gambling.

“I observe no logical or objective factors on Prague’s live gambling regulation map that could justify the complete regulatory divergence between different city regions,” he wrote.

Gambling regulation disputes have long divided the Czech Republic. The Gambling Act (revised in 2016) allows municipalities the power to create their own restrictive ordinances for gambling activities, enabling them to choose which games to ban or permit.

However, the Czech Interior Ministry had suspended the article, citing that its application stifled competition, impacted both central gambling controls and the economic performance (tax revenue generation) of gambling licences.

The Prague City Council views the Court’s decision as a validation of its approach to tackling problem gambling through district-specific regulations, stating that “standard regulations fail to recognise the distinct qualities of each neighbourhood, as certain districts face severe problems related to gambling addiction and criminal activity.”

The Court determined that dividing the city into districts for regulatory purposes was justified, noting that the approach was not arbitrary, and that the rationale behind each district’s rules was “ordinary and necessary”.

According to the Czech Competition Authority, the decision will create regulatory difficulties for the gambling industry. Businesses operating in different districts will need to navigate a fragmented set of rules, creating complex and costly compliance challenges. Many licence holders are now reviewing their locations.

The ruling not only grants Prague’s districts greater autonomy but may also pave the way for other cities to challenge the government and implement individual ordinances across the Republic’s 14 provinces.

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