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Economics of Gambling in Belgium – Lottery

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There are five classes of legal gambling in Belgium, each with licenses offered that are valid for fifteen years. The categories of licenses are:

– Class A – Casinos;
– Class B – Amusement Arcades;
– Class C – Public Houses (drinking establishments – pubs);
– Class D – Licenses an individual for professional activity in a casino;
– Class E – 2 types of licenses:
(1) Permits the holder to sell, rent, lease, supply, import, export, produce, maintain or
(2) repair equipment associated with games of chance. (GBGC Report).

Until 1999, casinos in Belgium were tolerated but were technically illegal. Since that time, they have been given legal status. There are presently nine casinos licensed in Belgium. Under the 1999 law, credit cards are not permitted to be utilised for gambling, except in casinos.

The Belgium Gambling Commission estimated that there were 16 million euros involved in money laundering in Belgian gaming establishments over the prior twenty year period. This figure is based especially on the money laundering during the past 20 years by the Casino of Namur and marginally on other businesses.

GAMING SECTOR ANALYSIS

Lotteries

The Belgian National Lottery dates back to 1963, and is under the authority of the Minister who has the public business undertakings within his attributions. It exclusively organises numbers and instant lotteries via on line terminals in physical points of sales. No lotteries are currently commercialised via the internet or other interactive media, nor is sports betting. A new multi-Member State cross border lottery, Euromillions, was launched in the EU in 2004, and included Belgium as one of the participating countries. However, the game is organised by each state lottery on its own territory, each with its own rules, there is no cross-border marketing nor sale and only the prize pool for the prizes in the highest prize tier and the draw are common features;

A tombola, a special kind of physical lottery, can be authorised by the competent authority on the condition that it is organised exclusively by a non-profit organisation and that the gross gaming revenue exclusively goes to good causes for the benefit of which it has been organised. Tombolas are authorised by the public authority for each territory. There are more or less 50 organisations involved in the sales of tombolas at the national level in Belgium.

The Number of Tombolas in Belgium 2000-2004 :

  • Year: No. of Tombolas
  • 2000: 51
  • 2001: 47
  • 2002: 46
  • 2003: 51
  • 2004: 57

Source: Submission to the Enquiry from Belgian Gaming Commission

There are absolutely no statistical data about the number of organisers of tombolas authorised at provincial or local level (communal tombolas) (respectively authorised by the “permanent deputations” and by the “Bench of Mayor and Aldermen”). However, the market share of tombolas other than those at national level is negligible. As a result of accounting only for national tombolas, the totals and percentages of market shares are approximate.

Belgian Lottery Market by Share 2000-2004 (in €) :

  • Lottery> 2000 (€) 2001 (€) 2002 (€) 2003 (€) 2004 (€)
  • Belgian National Lottery: 1,030,108,547 989,170,244 948,636,475 987,929,341 1,078,047,038
  • National tombolas: 13,324,856 19,959,369 17,535,289 16,015,994 17,634,115
  • Totals 1,043,433,403 1,009,129,613 966,171,764 1,003,945,335 1,095,681,153
  • Market share National Lottery: 98.72 % 98.02 % 98.18 % 98.40 % 98.39 %
  • Market share national tombolas: 1.28 % 1.98 % 1.82 % 1.60 % 1.61 %

Source: Submission to the Enquiry from Belgian National Lottery

Gross sales of lottery products in Belgium have remained relatively stable over the period 2000-2004, with gross sales in 2004 at €1,078 million. Gross sales for Tombolas were considerably less, as is shown in the tables below.

Gross Sales (Turnover) of Belgian National Lottery 2000-2004 (in €) :

  • YEAR: INSTANT LOTTERIES | ON LINE DRAW GAMES | EUROMILLIONS | TOTAL
  • 2000: 267,541,196 | 762,567,350 | – | 1,030,108,547
  • 2001: 256,095,337 | 733,074,907 | – | 989,170,244
  • 2002: 215,898,485 | 732,737,989 | – | 948,636,475
  • 2003: 212,196,191 | 775,733,149 | – | 987,929,341
  • 2004: 239,832,746 | 809,489,78 |8 28,724,504 | 1,078,047,038

Source: Submission to the Enquiry from Belgian National Lottery

Belgian Lotteries (Tombolas) Authorised by Ministry of the Interior 2000-2004:

  • Year: Number of draws | Money collected following the sale of the tickets (turnover)
  • 2000: 51 | €13,324,856
  • 2001: 47 | €19,959,369
  • 2002: 46 | €17,535,289
  • 2003: 51 | €16,015,993

Source: Submission to the Enquiry from Belgian Gaming Commission

The Loterie Nationale de Belgique’s current sales network includes on average 6500 outlets.

Belgian Lotteries GGR (in €):

  • Lottery: 2000 | 2001 | 2002 | 2003 | 2004
  • National lottery: 487,935,295 | 471,350,554 | 461,249,751 | 476,124,282 | 524,093,872
  • Tombolas: 7,994,914 | 11,975,621 | 10,521,173 | 9,609,596 | 10,580,469

Note: The Tombolar GGR is approximate and calculated as 60% of turnover.

Source: Submission to the Enquiry from Belgian National Lottery

The lotteries in Belgium are not liable for VAT taxation. They pay VAT and duties on the goods and services they purchase (including on the commissions paid to the intermediaries of the commercial network) (21%). The Belgian National Lottery annually pays a so-called “monopoly levy” to the national Treasury at about 8% of Gross Sales. It is, however, important to note that the legal lottery monopoly was abolished in April 2002.

National Lottery’s «Monopoly Levy» contributions 2000-2004:

  • Year: Monopoly Levy
  • 2000: €61,973,381
  • 2001: €86,762,734
  • 2002: €86,762,734
  • 2003: €86,763,000
  • 2004: €86,763,000

Source: Submission to the Enquiry from Belgian National Lottery

In addition, the Belgian National Lottery is liable for all taxes and duties applicable to all legal entities in Belgium. The Loterie Nationale has contributed €12,147,581 to the Fondation Roi Baudouin charity in 2004. It has been a continuous sponsor of this charity since 1989. In general, National Lottery of Belgium contributes regularly to good causes, as was specified in the management agreement between the Belgian State and the National Lottery of Belgium.

Good Causes Contribution by Belgian National Lottery 2000-2004 (in €):

  • Year: Amount of Contribution
  • 2000: €184,680,675
  • 2001: €182,821,474
  • 2002: €210,590,507
  • 2003: €240,191,000 (an additional €30 million was requested by government)
  • 2004: €210,590,510 (€210,191,000 + €399,510 for the fight against gambling addiction),

Source: Submission to the Enquiry from Belgian National Lottery

The management agreement 2003-2008 between the Belgian State and the Belgian National Lottery stipulates that the total annual amount of contribution paid by the National Lottery of Belgium will remain at €210.2 million up to and including 2008. Since 2004 an annual amount of €399,510 has been allocated to finance the fight against gambling addiction. In addition, Belgian authorities have the possibility to request additional funding from the National Lottery every time there is an exceptional situation. The National Lottery of Belgium has for instance, at the request of the government, contributed €2,000,000 to the disaster relief efforts for the victims of the 2004 tsunami, debited from its 2005 budget.

Most of the people employed in the tombola sector in Belgium are volunteers. The number of persons employed full time in the National Lottery of Belgium is given below.

The Number of FTE in the National Lottery in Belium 2000-2004 :

  • Year: Number of FTEs
  • 2000: 329.5 FTU + 11 under self-employment contract
  • 2001: 309.9 FTU + 12 under self-employment contract
  • 2002: 301 FTU + 10 under self-employment contract
  • 2003: 322.7 FTU + 10 under self-employment contract
  • 2004: 321.1 FTU + 0 under self-employment contract

Source: Submission to the Enquiry from Belgian National Lottery

The distribution network has about 6,565 POS terminals and on average one person employed per terminal. Hence the Lottery argues another 6,500 people are indirectly employed in distribution of lottery product (though it is difficult to discern whether they are Full Time Equivalents.) In addition, personnel in the sponsored non-for-profit organisations account for about 10,000.

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