Gambling is an important sector of the Greek economy and this fact was even acknowledged in antiquity. Greece has an infrastructure for gambling tourism and casinos and it is viewed by many as the best spot for casinos in Europe. Online gambling grew in Greece during the past 15 years and it allegedly supports 24 per cent of the online casinos on the internet.
Legal framework
The Greek state in the past supported land-based casinos but did not favour at all gambling outside casinos, a practice rendered illegal back in 2002 with the Law 3037/2002. Back then all electrical games, electromechanical games and electronic games played in public places such as hotels, cafeterias or private places were banned.
This law was enacted to fight illegal gambling and was extended to all gaming because the government could not differentiate “regular” games and gambling machines. However, the result was quite the opposite given that illegal gambling thrived in Greece and is nowadays estimated at €4bn per year.
One important factor, perhaps even more important than land-based casinos when it comes to gambling and betting, is OPAP (Organisation of Football Prognostics), an organisation 33 per cent of which is still controlled by the state.
In 2010 the approach of the Greek government changed and finally the Law 4002/2011 was voted in August 2011, applicable to technical leisure games and games of chance. This law follows the principles of responsible gaming and it introduces the individual player card that will assist in ascertaining the player’s age and tax registration number, cash flows, maximum participation time and in guaranteeing that any additional restrictions imposed by the players themselves are observed.
The individual player card may be issued by licence holders pursuant to the procedure and terms and conditions laid down in a decision of the Gaming Supervision and Control Commission published in the Government Gazette. Gaming without an individual player card is strictly prohibited. With this step it is evident that Greece is a pioneer when it comes to player protection at European level, given that the Greek government ensures that it will be able to receive money when appropriate and protect players if necessary.
Moreover, generally speaking:
• The provisions of the law shall apply to technical leisure games and games of chance played on gaming machines or online. • The law sets as a general rule the prior authorisation of all activities providing gambling and betting services. • The law refers to the competent authority for issuing licences and certificates and for supervising and controlling the running and operation of games, named the Gaming Supervision and Control Commission. • Pursuant Art. 29 par. 4, advertising should provide a very strict level of consumer protection and should not be aimed at strengthening the natural inclination of consumers to the games by encouraging active participation in them, making the games commonplace or projecting a positive image in relation to the fact that the proceeds are earned for general interest, or increasing the power of attraction of gaming through advertising promising misleading significant expected profits. • Pursuant to Art. 31 par. 5, the GSCC determines by a decision the amounts the licensees should have in a credit or payment institution located and legally operating in Greece. The nature and scope of the licence are considered in order to determine the aforementioned account. • Pursuant to Art. 32 par. 1, the legal age for individuals allowed to participate in games of chance is 21. Art. 33 par. 1 determines that minors and persons of 18 to 21 years of age are not allowed to gamble. • Article 38 par. 3 determines that non-profit legal entities are not allowed to be issued a licence for technical entertainment games with gaming machines. • The minimum amount payable for participating in games of chance played using gaming machines is €0.10 and the maximum amount is €2. Those amounts may be adjusted by decision of the GSCC. • The licensee is obliged to maintain the information he receives from the gaming machines or the online game for at least 10 years in a safe medium (or media), pursuant Art. 30 par. 5 and 6. • A licence granted shall be valid for 10 years from the date on which it is awarded and an extension in the licence for a period of time equal to or shorter than its term, under the same conditions but at a different price, exists in the law. • Licences are personal and non-transferable.
Online gaming licences
As it concerns online betting licensing procedure:
1. The Minister of Finance shall publish a decision announcing a tender for licences for running online games of chance. The licences shall be granted following an international highest bidder tender procedure.
2. If all licences announced are not awarded, the licences not awarded shall be put out to tender again by a decision of the Minister of Finance after at least one year has elapsed. The licence for running online games shall be valid for five years from the date of award and shall include terms and conditions under which the activities for which it is issued may be carried on. As it concerns online game licences there is no limit concerning numbers.
3. At least one year before the end of each valid licence, the licence holder may submit an application to the GSCC requesting an extension in the licence for a period of time equal to or shorter than its term, under the same conditions but at a different price. In order to renew the licence it shall be essential that the terms of the licence were properly implemented and that a reasonable price is proposed. The procedure for setting the new price shall be laid down by decision of the Minister of
Finance. The conditions for participating in the tender procedure are the following:
1. It is open to capital companies with a paid-up share capital of at least €200 000.
2. In order to participate in the international tender procedure for a licence, it shall be necessary to submit a guarantee letter (participation bond) for €100 000 from a bank established and operating lawfully in Greece. There is no limitation on the number of online game licences.
Gaming machine (VLTs) licences
Concerning licences for gaming machines, there is a limit of 35,000 gaming machines (VLTs) pursuant Art. 39 par. 2. From these 35,000 gaming machines, 16,500 will be placed by OPAP in its agencies exclusively and the remaining 18,500 VLTs will be provided by OPAP SA to sub-licensees following international highest bidder tender procedure to between four and 10 assignees. Pursuant to Art. 42 par. 2a, OPAP’s shops are considered as exclusive shops if they follow terms and conditions set by the Code of Game Conducting and Monitoring.
Administrative and criminal penalties
There are administrative penalties pursuant to Art. 51 of the law whereas in case of violation of its provisions or of its regulatory decisions issued under the motion or conditions of licences, by decision of the GSCC a fine can be imposed of €1,000 to €2,000,000 or a percentage of gross receipts, per violation or per game machine, depending on the severity and frequency of the offence. Or the licence can be recalled temporarily up to three months or permanently.
Also pursuant to Art. 51 par. 2, if it appears that gaming is conducted without licence required by the provisions of the law, or without the proper certification of the shop, the certification bodies can close down the shop. Pursuant to Art. 51 par. 3, operators conducting games of chance without using an individual player card may be punished with a fine of €5,000 or up to €7,000 euros per violation.
Pursuant to Art. 51 par. 5, ISPs legally based in Greece are obliged not to provide access to illegal gambling sites. Pursuant to Art. 51 par. 6, licensees not establishing a connection with the “Informational System of Supervision and Control” via the Central Information System are punished with a fine of €100,000 or up to €500,000 and their licence may be recalled temporarily or permanently.
Moreover, for illegal operators of games of chance criminal penalties are provided pursuant to Art. 52 given that anyone conducting gaming activities without having the necessary licence to do so will be punished with imprisonment of not less than three years and with a penalty of €100,000 to €200,000 per game machine or, in the case of gaming carried out through the internet ,with a penalty of €200,000 to €500,000. In the case of games of chance, the offence is punishable with imprisonment of not more than 10 years.
Pursuant to Art. 52 par. 2, criminal penalties are also provided for advertisers or advertisees (i.e. for companies advertising and for companies being advertised) of games of chance carried out without a licence, with imprisonment of two years minimum and a penalty of €100,000 to €200,000. There are also criminal penalties for players participating in unlicensed games of chance pursuant to Art. 52 par. 3 who are punished with three months’ imprisonment maximum and a penalty from €5,000 to €20,000.
Pursuant to Art. 52 par. 4, anyone who installs or runs technical entertainment games without proper licence of either the game machine or space is punishable with imprisonment of at least two years and a penalty of €5,000 to €50,000 per game machine.
Pursuant to Art. 52 par. 5, anyone who installs or operates games of chance through game machines without proper licence for either the gaming machine or the game, or the space, is punishable by imprisonment of not less than three years and with a penalty from €150,000 to €200,000 per game machine.
Recent developments
Moreover, pursuant to the provisions of Law 4002/2011, the Minister of Finance has the power to legalise past years’ activities of companies offering internet gambling in Greece having their base in the EU or within the EEA and within this power the decision 1248/13-12-2011 was issued by the Minister of Finance.
Following this decision, all companies could legalise their activities retrospectively for years 2010 and 2011 by their voluntary submission to the Greek tax system. Companies who followed the decision’s requirements acquired a Greek VAT number, given that they paid to the Greek state 30 per cent of their gross gaming revenue gained in Greece in order to be free to act in Greece legally, until the final implementation of Law 4002/2011.
Players’ winnings from games of chance played in Greece via the internet shall be subject to tax, computed at a rate of 10 per cent. This tax shall be withheld and paid over by companies to the competent tax authority the next month from the date of payment of the profit to the players. Companies that did not follow this procedure could be included in a black list and it is unlikely they will be awarded a licence in the future.
Members of the GSCC were appointed with the ministerial decision 55906/1673/20-12-2011, signed by the Minister of Finance.
So far it is legal to allow Greek subjects to participate in gambling games if the companies providing them have complied with the requirements of the ministerial decision 1248/13-12-2011. However, there are no licences yet available and a new ministerial decision is expected to that end.
Conclusion
It is true that Greece is only at the beginning so there could be certain concerns. However, entrepreneurs who wish to invest should do so at that exact moment, i.e. at the beginning. It is better to come first than second, especially when a new market is created.
If Greece could be compared with a “new world” of the 15th century waiting for a bold explorer to discover it, then no one can say that a new world is risk free; nonetheless, potential profit reasonably expected from an always lucrative business seems to make the whole enterprise worthy of any risk. In essence, Greece is a brave new world and the die has been cast.
About the author…
Constantinos N Couccoullis is managing partner at Law Offices of Constantinos N Couccoullis and Associates and a General Member of IMGL.
This article was first published in the winter 2012 edition of European Gaming Lawyer.
