The fourth annual European Gambling Briefing opened its doors on May 13 at the Hotel Okura in Amsterdam, Netherlands. James Walker takes a look at the highlights...

More than 140 delegates were present on the opening day of EGB to discuss the many legal challenges currently facing the European gaming industry.

Wes Himes, managing director of Policy Action Group, the European public affairs consultancy, chaired the morning’s events, which saw Jesper Kärrbrink, former CEO of Svenska Spel, stress the importance of allowing a regulated gaming market to take shape within Sweden.

In addition, Eddie Feehan from the Internal Markets and Services division of the European Commission provided an update on the gambling policy infringement proceedings that are currently taking place against several EU member states, including Italy, France and Germany.

An expert panel of politicians from Sweden, Portugal and Germany shared a range of views surrounding the fate of the European gambling industry. However, while the speakers agreed that the ongoing war between the EC and European member states was hindering the industry’s progression, they said it did not justify the continued existence of gaming monopolies.

"Gambling is a complicated service, and cannot be treated like other services," said Swedish MEP Christofer Fjellner.

Gibraltar: is the door still open?

The EGB is used primarily as a platform to look at specific developments in European gaming jurisdictions, and the 2008 edition of the conference saw Phill Brear, head of gambling regulation for the Gibraltar Regulatory Authority, provide an update on the British territory’s position with regard to egaming.

Seeking to quell the ignorance over Gibraltar as a gaming jurisdiction, Brear, who was appointed as head of gambling regulation in October 2007 after two years as director of operations with the UK Gambling Commission, provided a brief synopsis of the self-governing British dependency’s rich history with gambling.

"To gain a sense of scale Gibraltar’s population is just one-quarter that of the Isle of Man - 29,000 people," he said. "Gibraltar’s proximity to Spain resulted in the region picking up on telephone gambling in the 1980s and 1990s, and quickly moving on to become a world hub for online gaming."

Having said that, the government in the region has said it does not want to depend on one sector, and therefore put a lid on gaming licences. Up until last year, there were just 15 online gaming companies or operators there. "In an effort to get white listed, a further four were added," said Brear. "So, we now have 19 big internet operators and one casino.

"There have been big changes over the last 18 months. The old regulations were outdated. I was employed to install a set of codes to give a stronger and more resilient profile to Gibraltar as a gaming jurisdiction. We are now in a phase of consultation as to how much detail the code would need to cover."

When asked if the door was still open for Gibraltar, Brear stated: "Well, I’d say the door is ajar. Although there are exceptions, operators looking to enter the jurisdiction must already have a substantial footprint somewhere - probably in Europe.

"This is not a place for start-ups. There is no room. You must want to move here for legitimate, open reasons. The government would not allow you to ‘escape’ a problem.

"Looking ahead, we are starting to see a new level of complexity," he continued. Many operators are now outsourcing particular aspects of their business - for example, payment processing or software development. In other words, the online gaming industry is starting to adapt to the business model of other businesses in different sectors.

"This desire to fragment services globally turns the idea of being ‘close’ to your regulator on its head. Going beyond Europe - third-world areas draw concerns, so the new Gibraltar code will have to account for this. This is an enormous distraction from conventional responsibilities."

Latvia: a fledgling gaming market

Despite being a relatively young market with numerous hurdles to overcome, the Latvian gaming market is slowly opening up, according to Janis Ungurs, director of the legal and licensing department for the country’s Lotteries and Gambling Supervisory Inspection.

Speaking at the EGB, Ungurs said that because of Latvia’s former occupation the gambling industry in the Baltic state is still relatively new - just 17 or 18 years old. "The inspection recently celebrated its 10th anniversary of regulation," he said. "Before that, it was just a few offices in the Ministry of Finance."

The Latvian gambling market has been issuing licensing to online operators since 2006. "To get a licence, you need E1.3m in paid share capital; you need to be registered as an enterprise in Latvia and must be prepared to have your business fully inspected. Only then can you operate."

While the licence fees are typical - some may say preferable - to other EU countries, Ungurs however noted that operators cannot advertise anywhere in public places, or internet or television.

Despite this, however, the growth of the Latvian gaming market, both land-based and online, is clear. In 2007, the total turnover of the Latvian gaming market was E300m, a more than ten-fold increase on the E27m reported in 1997.

Tackling public perceptions

What can operators and their lobbyists do to improve gambling’s image? According to one EGB panel, change does not only need to be pushed at a regulatory level.

Eduardo Antoja, president of the European Gaming and Amusement Federation, noted that the industries with the most regulatory constraints spend the most on advertising and promotions, with gambling top of the list, followed by tobacco, then alcohol, automobiles, food and beverage, financial services and cosmetics.

Antoja talked of the media’s role in tackling the perception of gambling, but stressed that it is the games and gamblers that contribute to perception the most. "This industry has not taken care of the public," he said. "Responsible gambling means responsible players."

Clive Hawkswood, chief executive of the UK’s Remote Gambling Association, highlighted the idiosyncratic nature and complexity of the argument surrounding gambling’s image.

"This is a huge issue for the RGA. We need to ask ‘why does public perception of the gaming industry need improving?’ Stereotypes are damaging, and negative images are holding the industry back."

"Online gaming, too, has its troubles, due to the fact that it is alien to the old school. It is perceived as being newer, faster and more threatening."

Hawkswood said that the media is perhaps the hardest nut to crack. "Good news is no news for the media," he said. "The media doesn’t care that 99 per cent of people who gamble are fine."

He stressed that going forward the gambling industry needs to minimise in-fighting, "We are not here to score points, because for many outside the industry they are the same entity," he concluded.