Industry Pushes For End To Austrian Online Gambling Monopoly

The Austrian Association for Betting and Gambling (OVWG) has called for an end to Casinos Austria’s monopoly in the context of a looming scandal following investigation into corruption between politicians and the country’s monopoly operator.

OVWG, which represents the domestic interests of online gambling and betting providers licensed in the EU, has spoken out in relation to an alleged corruption ties between Casinos Austria, its chief finance officer Peter Sidlo, who is also a Freedom Party of Austria (FPO) district councilor in Vienna, and shareholder Novomatic.

The ongoing investigation is looking into the accusations that Sidlo’s appointment had to do with amendments in the law around online gambling and slot machines in Vienna. Last week, Economic and Corruption Prosecutor’s Office (WKStA) officers carried out raids as part of the case, following the previous searches back in August.

The association is questioning the single online gaming license awarded to Austrian Lotteries by the Ministry of Finance and says it does not protect consumers in the same way as a well-regulated market supervising all operators. The association says that the Austrian Lotteries hold “unjustifiable” online gambling monopoly.

In a statement, the OVWG expressed its concerns regarding the situation: “The developments of the past few days have shown one thing: Austria urgently needs to rethink its gambling monopoly. On the one hand, this concerns the multiple function of the Federal Minister of Finance as supervisory authority, licensing authority and co-owner of the monopolist. On the other hand, there is the unjustifiable fact that there is only one national online gaming licence and that there are considerable concerns about its conformity with EU law.”

According to the OVWG, a transparent and safe gaming environment might be created only by applying up-to-date gambling regulation in line with market conditions. Customer protection, legal security for the business, comprehensive control and secured tax revenues for the state are among the association’s priorities.

The OVWG argues stands against the view that the monopoly can be the only regulator and says that: “The online sector in particular offers a multitude of technical possibilities that ensure comprehensive state control. For example, a safe server system allows the state to access the provider’s data. A comprehensive control and the introduction of a blocking database across all providers and game forms ensures that a blocked player cannot play with any other provider. It is also noteworthy that in Denmark the monopolist has not even lost market share through the abolition of the monopoly and the introduction of the licensing model.”

The association pointed out Denmark as a role model for achieving sustainable and successful online regulation. The OVWG says that the EU country is a pioneer in creating a “modern legal framework for the online sector and thus take account of the progressing digitisation”. The statement makes it clear that the “Danes have a licensing system with no numerical limit on the number of licences and strict requirements regarding consumer, data and youth protection.” The authority works in close cooperation with licensed gambling operators and only one year after the opening of the market in 2012, it estimated the stake of unlicensed operators to stand at less than 5 percent.