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Dutch government moves to regulate gambling market

05 January 2021, 18:10 CET

Historically the Dutch online gambling market was a grey market, without regulation or prohibition.

In 2018, the Dutch Gaming Authority (Kansspelautoriteit, or KSA) turned this grey into black with the introduction of regulatory proceedings. After two years of Senate draft approvals and committee hearings the legislation is finally moving forward.

Licensing

Gambling operators will be able to apply for a Dutch gaming license in March 2021, and begin legally operating in September. The approved bill has been shared with the European Commission for public comment to ensure it integrates well with broader EU law.

During this transitional period, only land-based or state-run operators have been permitted to offer gambling products. This includes HollandCasino, bookmaker Toto, and the state lottery. Casino or sportsbook operators which continued to illegally serve the Dutch market are subject to both a fine and market ban, consisting of a cool-off period between six months and two years. This has not stopped many from operating quietly, serving existing customers.

The bill has seen a number of delays in 2019-20, as initial estimates hopefully forecasted that license applications would become available this past July. This first deadline was pushed back to January 2021, and coronavirus-related administrative slowdowns added an additional two months onto the timeline. At present the March 2021 opening remains tentative.

Controversy

The KSA's primary concern is with the health and safety of the population. This has led the regulatory body to tighten its relationship with other bodies, like the Malta Gaming Authority. However, a potential application requirement has caused industry uproar.

The suggested requirement can be called a 'data-flush,' which would compel operators to liquidate their existing databases of Dutch players from the pre-regulation period. The intention is to begin with a clean market, not giving advantage to those who operated outside of regulation. The KSA may believe that if operators retain their user contacts these players can be more easily and precisely targeted with advertisements and marketing incentives once the market opens.

Industry experts fear that this measure is both unnecessary and counterproductive. To demand a flush of this kind effectively forfeits the market to large foreign operators with the marketing power to dominate the early playing field. Smaller and domestic operators would then lose their competitive edge, limiting consumer choice either to a monopolised legal market or a more attractive black market.

At this time it is not known whether this will be required. Therefore until March 2021 many operators will be anxiously awaiting the final process.

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