GamingInHolland Conference 2012


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  • ” Giving background information”
  • Ongame, 24 partners iPoker, 65 & 177 skins Entraction, 77 Microgaming, 36 IPN, 38
  • ” Why I am here”
  • ” Result we have seen at Ongame”
  • ” Giving background information”
  • ” Touching base on the tech side”
  • ” One of the most important questions”
  • ” Stating our core ideas”
  • ” Mobile learnings”
  • ” Showing example of desktop product”
  • ” Showing example of downscaled mobile interface”
  • ” What is most troublesome?”
  • ” Next steps”
  • GamingInHolland Conference 2012

    1. 1. Welcome to the first conference about eGaming in Holland
    2. 2. WelkomWillem van OortCEO of GranViaOnline & Conference Organizer
    3. 3. Industry Group on LinkedIn400 members to date(Spain Group 2250 members)
    4. 4. DenemarkenEst. Tax Revenue 2012Online Casino 19.8m EBetting 30.5m E
    5. 5. Netherlands Interactive GGY (€m)
    6. 6. European KPIsFor the time being, the €6.9bn of gross wingenerated by Europe’s eGaming industry during2008 still represented only 7.7% of thecontinent’s total gambling business up from6.3% the previous year.
    7. 7. Legal and Regulatory: IntroductionMr. Justin Franssen, Shareholder at VMWTaxand
    8. 8. Overview• Current Regulatory Set-up• Evolution of EU Case-law• Catalysts for Change• Plenary Debate – 7 Sept 2011; Motions & Emotions• Gaming Authority• Letter of State Secretary to Parliament – 4 May 2012• Fall of the Government; a Stumbling Block?• Looking to the Future
    9. 9. Current Regulatory Set-Up• Prohibition on supplying unlicensed gaming under Dutch Betting and Gaming Act (DBGA) • No licences available for remote gaming• Market largely supplied by monopolists • Semi-permanent licences awarded in a non-transparent manner to incumbents: • Sports-betting • Horserace betting • Lotto • Scratch-card • Charity lotteries • Monopoly for casino and state lottery• Unlimited number of licences for slot machine gaming
    10. 10. Evolution of EU Case-LawA Wide Margin of Discretion for Member States•Schindler (C-275/92); sufficient degree of latitude to determinewhat is required to protect players•Läärä (C-124/97); assess provisions of national law in relation tonational objectives and intended level of protection•Dickinger & Ömer (C-347/09); re-iterates wide discretion regardingobjectives and level of protection•Placanica (C-338/04); policy of expansion permits increased offer whilst maintaining restrictive measures
    11. 11. No Mutual Recognition•Liga Portuguesa (C-42/07); MS where service receivedcan disregard licensing by MS where operatorestablished as licensing authorities are liable toencounter difficulties in assessing professional qualitiesand integrity of licensees!•Dickinger & Ömer (C-347/09); MS can monitor aneconomic activity carried out on its territory;impossible if had to rely on checks by authorities ofanother MS with systems beyond its control
    12. 12. Reduction in MS Competence•Gambelli (C-243/01); restrictive measures only justifiable ifsuitable for achieving objectives of limiting betting activities in aconsistent and systematic manner•Placanica; unlawful exclusion from tender procedure deniesnational authorities ability to sanction•Markus Stoss (C-316/07); – Introduction of horizontal consistency – Monopoly justifiable only by a particularly high level of protection•Ladbrokes (C-258/08); – Will expanding authorised and regulated activities solve problem of unlawful activities? – National court must be satisfied expansion of offer is effectively supervised by authorities to reconcile competing objectives
    13. 13. Limits on Activities of Incumbents•Dickinger & Ömer; – Distinguish between restrained commercial policy and an expanionist commercial policy•Marcus Stoss; advertising must be limited to what isstrictly necessary, no encouragement of consumers togamble, cannot trivialise gambling nor give it a positiveimage due to fact revenues go to good causes or depictmajor winnings
    14. 14. Transparency & Market Access•Carmen Media (C-46/08); regulatory objectivescannot render discretionary conduct which negatesfree movement provisions•Sporting Exchange (C-203/08); duty of transparencyapplies to award/renewal of single licence subject tostrict control exception•Costa & Cifone (C-72/10); – Very difficult to favour existing licensees over new market entrants in licence award procedure – Exclusion from licence due to suspected criminal activities requires judicial decision regarding a sufficiently serious offence
    15. 15. Catalysts for Change• Change of government Oct 2010 >> Policy Note of March 2011 – Regulate currently unregulated forms for which consumer demand exists • Do so more broadly than merely online poker – Comply with EU law • Allocate licenses in a consistent, transparent and non-discriminatory manner – Council of State (Raad van State) 23 March 2011 held that De Lotto was not subject to strict control; licence award process thus incompatible with EU law as award process should have respected duty of transparency • Horizontal consistency – As per Carmen Media• Liberalize the offline market in 2015 – Competition instead of monopolies
    16. 16. • One step back? – Decision of the Supreme Court (Hoge Raad) in De Lotto v. Ladbrokes 24 February 2012 • Compatibility of monopoly model challenged; alleged policy of controlled expansion conflicting with aim of preventing addiction and consumer protection • Held that monopoly model for sports-betting is compatible with EU law • Maintains injunction awarded against Ladbrokes requiring it to block access for Dutch residents to its services • Supreme Court merely reviewed earlier 2006 decision of Court of Appeal • Failed to follow guidance of CJEU in Ladbrokes – Superseded by government policy and planned regulation of remote gaming?
    17. 17. Plenary Debate – 7 Sept 2011; Motions & Emotions• Discussion regarding forthcoming Gaming Authority• State Secretary under pressure to combat unlicensed remote operators• Motions passed, including – Calling for the ‘Belgian model’ to be introduced Financial transaction blocking (“blacklisting”) • After hesitation now moving forward – Excluding illegal operators from licences in the future • Via an integrity test; exclude those illegally present on the market • Danger of undermining objectives of reform if all operators unable to obtain a licence
    18. 18. Gaming Authority• Bill amending DBGA passed 20 December 2011• Independent administrative regulatory body > operational on 1 April 2012• Main functions – Issue, revoke & enforce licences – Supervise & enforce gaming regulations – Act as a knowledge center• Sanctions – Administrative fines (€780,000 or 10% of turnover) – Administrative orders – Incremental penalty payments – (Prosecution by the public prosecutor will remain an option)• Maintain blacklist for PSP and ISP blocking measures (future specific legal basis?)
    19. 19. Letter of State Secretary to Parliament – 4 May 2012• Indicated that the Supreme Court´s decision in De Lotto v. Ladbrokes no longer relevant given plans to modernise regulation• Favours an “open system” for regulating remote gaming backed by stringent conditions than a “closed system”• Responds to motions from 7 September 2011 – Rejects call for the “Belgian model” to be introduced – Financial transaction blocking (“blacklisting”) • 40 operators served cease and desist letter; some withdrawn entirely, some ignored and therefore listed and others have only withdrawn offer directed at the Netherlands – Excluding illegal operators from licences in the future • Those who persist in supplying unlawfully will be excluded from licences in due course
    20. 20. Fall of the Government: A Stumbling Block?• Cabinet fell on 23 April 2012 during negotiations on budget cuts• Lenteakkoord (VVD, CDA, D66, GroenLinks & ChristenUnie) of 25 May 2012; decided to cancel proposed introducing of licensing regime for online gambling• Gambling declared controversial; dossier put on ice until after national elections – 12 September 2012• Non-compliance with EU law still remains regarding renewal of semi-permanent licences – Current licence for Nationale Postcode Loterij expires 31 December 2012
    21. 21. Looking to the Future• Timeframe before gambling reform declared controversial: – Q2 2012 – bill to amend DBGA • Remote gambling licensing regime • Transparent licence allocation procedure • Legal basis for blocking measures – 2013/2014 – remote gambling licences available – 2015 – liberalisation of offline sector
    22. 22. Gaming, Sports & Entertainment practice group Justin Franssen Professor Marjan Olfers + 31 20 301 66 48 Frank Tolboom Dr. Alan Littler Younes Moussaoui
    23. 23. The future of online regulation in the Netherland?Dr. Alan Littler, Gaming Lawyer at VMWTaxandMr. Justin Franssen, Shareholder at VMWTaxandMr. Morten Roende, CEO of Danish Online GamblingAssociationMr. Eric van Vondelen, independent Gaming Advisor
    24. 24. www.doga.dkDOGA is:•‘working with the Danish regulator and legislators indeveloping the regime for the industry to operatewithin’•‘providing a forum for the industry to shareknowledge, to agree policies, to share resources and toadopt strategic responses to common challenges’
    25. 25. Licencees41 operators licenced for betting and online casino –including… 888 igame bet365 IGT Interactive Unibet Betfair Gaming Media Group Betsson Ladbrokes Betway Nordicbet Bonnier Gaming pkr Pokerplex24 Pokerstars Cryptologic Sportingbet Danskespil Stanleybet
    26. 26. Danish Gambling Market 2009-2012 2012 2011 2009 GGR Game types GGR DKK GGR Euro % GGR DKK Euro GGR DKK GGR Euro % Betting 1135 152 15,1 n/a n/a 797 107 12,3 Online Casino 735 99 9,8 0 0 0 0 0,0 Gaming Machines 1840 247 24,5 1785 240 2034 273 31,5 Land-based Casino 320 43 4,3 320 43 335 45 5,2 Lotteries 3470 466 46,3 n/a n/a 3151 423 48,8 Bingo n/a n/a n/a n/a n/a 142 19 2,2 Total 7500 1007 100 6459 867 100
    27. 27. Coffee BreakWe will be back at: 11:15 am
    28. 28. Compliance, Safety and SecurityMr. Roel van Rijsewijk, Deloitte Risk ServicesMr. Gregory Kuhlmey, Head of iGaming Compliance,DICTAOMr. Ben Verhoeff, MD NMi (a TNO Company)
    29. 29. Compliance GamblingAnti Money Under Age Awareness & SelfLaundering Gambling Exclusion Know Your Customer Identity Behaviour
    30. 30. Securityunderstanding of yourclients behaviours and spending patterns Account phising scams Organised Fraud Trojan attacks Rings Online Gaming Fraud Unsafe network ... Identity Gnoming theftCurrent Financial Climate
    31. 31. Lunch BreakWe will be back at: 1:15 pm
    32. 32. Taxation of eGaming in a regulated marketMr. Frans Duynstee, Managing partner at VMW TaxandMr. Pedro Fernández, partner at Garrigues, Spain
    33. 33. General Overview Dutch Gaming  Tax payer Taxable base Exemption € Rate Loss 454 compensationDutch Casino resident gross earnings of the provider (that is the difference No 29% Yesgames provider between the stakes received and the prizes awarded to the participants)  Slot machines in resident gross earnings of the provider (that is the difference No 29% Yesthe Netherlands provider between the stakes received and the prizes awarded to (in Dutch: the participants) exploita nt)Dutch Online resident gross earnings of the provider (that is the difference No 29% Yesgames provider between the stakes received and the prizes awarded to the participants)Other Dutch Dutch Prizes awarded to the Yes 29% Nogames player participants. No off set (the of the stakes. resident provider has to withhold the gaming tax)Non Dutch Online Player gross earnings of the player (that is the difference No 29% Nogames between the prizes received and the stakes)In practice no Dutch income tax is due by the playerOther Non-Dutch Player Prizes awarded to the Yes 29% Nogames participants. No off set of the stakes.
    34. 34. Bottlenecks Dutch Gaming• Gaming tax lacks legal basis• When is it a game of chance?• Lack of clarity regarding domestic online games of chance• Unacceptable administrative burden for the players• Vagueness regarding definition online game of chance• Difference in effective tax burden between domestic and foreign casino and online game of chance• No possibility to set off losses for players• Level of tax rate• Rigid scope of the exemption avoidance double taxation• Vagueness on set off gaming tax against income tax and corporate tax
    35. 35. Recent Case Law• Is poker a game of chance or a game of skills? District Court of The Hague, 09/867520-08 (criminal law) (Poker is a game of skills) and the District Court of Leeuwarden, (AWB)09/512 (tax and not published) Poker is a game of chance. Appeals has been filed.• The distinction between gaming tax regime Dutch live casino games and EU casino games is against EU law (freedom of services) District Court of Haarlem November 24, 2011, LJN: BU6574, 11/1112. No Dutch gaming tax on EU live casino winnings.• The distinction between gaming tax regime Dutch online games and EU online games is against EU law (freedom of services). District Court of Haarlem May 23, 2012, AWB 11/4240 and AWB 11/4241 (not published yet).
    36. 36. Table of Contents• Gaming duties in Spain• Controversial issues• Operators’ responsabilities• VAT• Other tax implications
    37. 37. Gaming Duties in SpainRegulated in Law 13/2011 of May 27, regarding theregulation of gaming activities Type of games Taxable base Tax rateMutual Sports bettings Gross income: total amounts 22%Mutual Horse bettings & other mutual dedicated to participate in the 15%bettings game; as well as, any other income directly derived from theRaffles and contests gaming activity 20%Benefic raffles 7%Bettings against the house Net income: total amountsOther games dedicated to participate in the game less the winnings paid over 25% to the playersNon banking bettings Comissions and any other income 25% from services rendered in connection to the gaming activity.Random combination for advertising Amount of the prizes 10%
    38. 38. Controversial Issues• Gaming tax – Taxable base • Jackpot • Bonus Money wagers • Multiple player • etc. – Tax payer: Co-operators, provider of gaming services• Personal Income Tax of the Spanish player: – Taxable base: gaming loss non deductible
    39. 39. Operator’s responsibilities• Requirement of being up-to-date with its tax obligations. In case of succession of the gaming activity, the operator would be responsible for any outstanding tax obligations of the previous operator in relation to said gaming activity.• Tax obligations: – Gaming duty, according to the regulations previous to Law 13/2011 – Gaming tax, according to the regulations previous to Law 13/2011 – Non resident income tax / Corporate income tax – VAT – Withholding obligations
    40. 40. VATGeneral rule: Services are subject to VAT in the country of residence of therecipient entity Service Co Advertising services EU/Non EU Spain Gaming Co Gaming service
    41. 41. VATSpecial rule: when according to the general rule the service is not located in theCommunity, but its effective use is carried out in such territory, the service would besubject to Spanish VAT (only applicable to a list of services, including advertisingservices, consultancy, services provided electronically, etc.) Service Co Ancillary services Gaming Co Non EU Country Spain Service Co Gaming service
    42. 42. Other Tax Implications Gaming Co / Service Co  Tax implications: Gaming - Non resident Income Tax service - CIT - Withholding obligationsSpain Withholding? Software PE services Withholding? Spanish Gaming Co Gaming service Withholding
    43. 43. Contact Pedro FernándezE-mail: pedro.fernandez@garrigues.comDon Cristián, 2 – 29007 Málaga (SPAIN) Telf.: +34 95 207 55 25 Fax: +34 95 207 55 35
    44. 44. Responsible Gaming within an online environmentMr. Kees Boef, Managing Director, Burson MarstellerMr. Pieter Remmers, Founder at Assissa (ResponsibleGaming Consultancy and Training)
    45. 45. Short BreakWe will be back at: 3:00 pm
    46. 46. Media and Marketing of online betting and gamingMr. Willem van Oort, CEO Gran Via OnlineMr. Bob van Oosterhout, Triple DoubleMr. Reinout te Brake, CEO and Founder of IQU.comand former strategist at Spill GamesMr. Jasper Hoekert, Strategy Director Performance ofOmnicon
    47. 47. GOUDEN BAL
    48. 48. BELGIË - NEDERLAND
    49. 49. The Poker SessionMr. Rolf Slotboom, Former Poker Pro andSpokesperson at Dutch Poker Federation and FoundingMember of International Poker FederationMr. Thomas Bakker, Bakker & Davidowitz Consulting,Former Poker Player, Mathematician, co-founder ofSubject: Poker and current Poker Security Consultant.Mr. Kaj S. Emanuel, Young Democratic Party (D66)
    50. 50. Poker Wetgeving: spelersgeldHuidige wetgeving:•Sites gaan geregeld failliet•Spelers de dupe
    51. 51. Poker Wetgeving: fraudeFraude:•Collusion•BotsBots specifiek:•Tientallen miljoenen per jaar•Potentieel het einde van poker
    52. 52. Mobile Gaming: NOT just another screenMr. Fredrik Kjell, Head of Product at ONGAME- Swedenand the architect behind Ongames mobile strategy
    54. 54. AGENDA • Regulation • The success of mobile poker
    55. 55. Ongame poker Since 20012008 2010 2012 2012
    56. 56. REGULATION KEY LESSONS • Work with the suppliers • Bilateral agreements for technology • Shared liquidity – local taxes • High taxes destroy chance of success
    57. 57. MOBILE POKER
    58. 58. REVENUE
    60. 60. HISTORY • Mobile platform since 2005 • Competent product from start • Low interest from players
    62. 62. APP OR WEB?66% time spent on Native app33% time spent on Web app WEB APP+ Quality. Capabilities.- Approval. Availability.
    63. 63. WE BELIEVE THAT • 20% of revenue from mobile end of 2013 • Tablets are the new couch computers • Recreational players use mobile devices
    64. 64. PRINCIPLES • Interface aligned with terminal • Experience according to user behaviour • Waiting yields frustration
    65. 65. CHALLENGES • Multiple platforms • Regulatory compliance Available • App Store approval • Austria • Latvia • Belgium • Lithuania • Cyprus • Netherlands • Czech Republic • Poland • Denmark • Romania • Estonia • Slovakia • France • Slovenia • Greece • Sweden • Italy • Switzerland • United Kingdom
    66. 66. FORWARD >> • User experience improvements • Multi tabling support • Tournaments and lobby
    67. 67. Thank you!Informal Drinks In the bar