Online gambling plans scrutinised

Plans to open up the €1.17 billion online betting market are being studied by MPs

6 October 2009

PLANS to open up gambling legislation are going before MPs today as budget minister Eric Woerth revealed about 50 online operators would be legalised in a bid to drive out the pirates.

The plan to license operators would see sporting bets, horse racing and poker widely available online from 2010 instead of only being available from the Française des Jeux, PMU, and casinos as at the moment.

It is being pushed through the National Assembly so that it will be in place before the World Cup in South Africa in 2010.

The total gaming market is worth €5billion in tax revenue and Mr Woerth said opening up the market should maintain this level. He said “hard” revenues from the traditional sources would be matched by the arrival of new cash from online sources.

He says the licensing plan would also be able to keep up the fight against money-laundering, protect players from becoming addicted and keep minors out of the market. He also sees it guaranteeing the “ethic” of sporting competition.

Gaming firms would have to get a licence to operate in France even if they already held licences elsewhere in the EU.

The European Gaming and Betting Association (EGBA) says some of the provisions conflict with the EC Treaty.

It says the move to ring-fence the French market goes against the open-border nature of the EU and could create an underground, uncontrolled market with no consumer protection; while the restriction of the horseracing market to pool betting only as this forces an alignment with the traditional PMU instead of allowing fixed odds bets.

Some of the online firms’ competitive arguments are also cut away with plans for caps on their payback ratio to players to help stop problem gamblers. While online EU operators usually pay back 95% to players the PMU only offers 78% and the Française des Jeux 75%.

Gaming firms have been warned to wait until the law is in place before moving into the market. One company, Zeturf, has already been warned over illegal “advertising in disguise” after it took out a full-page in the Metro free newspaper for last weekend’s Prix de l'Arc de Triomphe horse race.

One company is already giving every new player residing in France a €15 introductory credit. Such offers from online casinos are likely to snowball as restrictions begin to lift.

The French online gambling market – run at the moment through Française des Jeux and the PMU – was worth €1.17 billion in 2008 (€630 million for the FDJ and €540 million for the PMU). A recent survey said it could grow to €3.4 billion in five years

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