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General interest reasons which may justify restrictions on gambling activities in EU Member States

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Member States may justify restrictions to the fundamental freedoms for reasons related to the general interest (Consistent case-law, see most recently Case Garkalns, par. 35, and the case-law cited.). A restriction to the freedom to provide services or to the freedom of establishment may be:

• allowed as a derogation, on grounds of public policy, public security or public health, as expressly provided for by Articles 51 and 52 TFEU, which are applicable in the area of services by virtue of Article 62 TFEU, (The reasons referred to in Articles 51 and 52 TFEU may justify national measures which are either discriminatory vis-à-vis foreign operators or which apply without discrimination to national and foreign operators. See, to that effect, Case Dickinger and Ömer, par. 79; Case Placanica, par. 49.) or

• justified, in accordance with the case-law of the CJEU, by overriding reasons in the public interest (Restrictions justified by overriding reasons in the public interest must be applied without discrimination.) With regard to the justifications which are capable of being accepted, the CJEU has observed that the objectives pursued by national legislation adopted in the area of betting and gaming, considered as a whole, usually concern:

• the protection of the recipients of the services in question and of consumers more generally, and

• the protection of society.

Within these two general categories of objectives, the courts have identified more specific interests such as the fight against gaming addiction, the reduction of gambling opportunities, the fight against crime and malpractice, and the general need to preserve public order.

On the other hand, the general interest objectives must be of a non-economic nature. Other reasons put forward by Member States have been rejected by both courts, owing to their economic or financial nature. These reasons include:

a) the diminution of the reduction of tax revenue (Case Gambelli) / maximising public revenue; (Case Dickinger and Ömer)

b) the need to ensure continuity, financial stability and a proper return on past investments of licence holders (Case C-260/04, Horse-race betting licences (Commission v. Italy), par. 35; Costa and Cifone, par. 59.) / protecting the market positions of existing operators; (Case Costa and Cifone, par. 65.)

c) the contribution to the rural development by financing horse breeding. (Case Zeturf, par. 51; Ladbrokes, par. 68.)

It is also settled case-law that a “ground of economic nature” such as the financing of benevolent or social or other public-interest activities through a levy on the proceeds of authorised games of chance may constitute only “an incidental beneficial consequence” and not the real justification for restricting the freedoms of establishment and the provision of services related to games of chance. (Case Zenatti, par. 36; Case Gambelli, par 62; Case Gaming machines, par. 36; Dickinger and Ömer, par. 61, with references to previous case-law; Ladbrokes, par. 75. The financing of public-interest activities with the revenues of gambling and betting activities must be distinguished from the “aim of preventing gambling from being a source of private profit”. The latter issue relates to the condition of limiting the grant of a licence to one or more non-profit entities (see further chapter 5.6.3.3).) Therefore, a Member State is not entitled to rely on reasons of public policy relating to the need to reduce opportunities for gambling in so far as the public authorities of that State incite and encourage consumers to participate in games of chance so that the public purse can benefit. (Dickinger and Ömer, par. 62.)

The Member State concerned should in each case determine which legitimate objectives may justify the restriction, and the justification grounds put forward by a Member State must be taken together and considered as a whole. (Schindler, par. 58; Zenatti, par. 31; Gaming Machines, par. 34; Ladbrokes, par. 44.)

The Court has acknowledged that, when analysing the betting and gaming sector, it is not possible to disregard the associated “moral, religious or cultural factors” or the “morally and financially harmful consequences for the individual and for society” associated with betting and gaming. (See already the judgment in Case Schindler, par.60; see also Case Dickinger and Ömer, par. 45.)

According to settled case-law, in the absence of harmonisation on the games of chance, all those particular factors justify national authorities having “a sufficient margin of discretion […] to determine, in accordance with their own scale of values, what is required in order to ensure consumer protection and the protection of society”. (Dickinger and Ömer, par. 45; Stoß and Others, par. 76, and case-law cited.) The Member States are therefore “in principle free to set the objectives of their policy on gaming of chance and, where appropriate, to define in detail the level of protection sought”. (Liga Portuguesa, par. 59; Case Dickinger and Ömer, par. 47.)

The Court has also held that, in the context of legislation which is compatible with the Treaty, the choice of methods for organising and controlling the operation and playing of games of chance or gambling falls within the margin of discretion enjoyed by national authorities. (Stoß and Others, par. 92, and case-law cited.)

However, the restrictive measures imposed by the Member States must be applied without discrimination and must satisfy the conditions laid down in the case-law as regards their proportionality. Thus, they must be suitable for ensuring the attainment of the objective pursued and not go beyond what is necessary in order to achieve that objective. In this connection, it is settled case-law that national legislation is appropriate for ensuring attainment of the objective pursued only if it genuinely reflects a concern to attain it in a consistent and systematic manner. (Case Garkalns, par. 37, and the case-law cited.)

Source: europa.eu

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