Lottery Licenses Netherlands: The Court of Justice of the European Union sides with EBGA

The Court of Justice of the European Union sides with EBGA in its appeal against the European Commission’s refusal to open a state aid investigation into the granting of lottery licenses in the Netherlands.

The Court of Justice of the European Union (CJEU) has ruled that the European Commission must investigate possible unlawful financial advantages resulting from the way in which the Dutch State granted licenses to incumbent lotteries in the Netherlands.

In 2020, the European Commission concluded that a formal EU investigation into the Dutch licensing procedure was not necessary, stating that it did not provide incumbent lotteries will illegal state aid, and subsequently closed the original complaint filed by European Gaming and Betting Association (EGBA) back in 2016. EGBA appealed the Commission’s decision to the CJEU in March 2021, asserting that the renewal of multiple lottery licenses of incumbent holders, without consideration at market rate and without an open, transparent and non-discriminatory license allocation process, constituted illegal state aid. EGBA also argued that the Commission’s refusal to investigate the case infringed upon its right under EU law. According to EU law, if there is any doubt about the possible existence of illegal state aid, the Commission is obligated to initiate an investigation. Consequently, the Commission will now commence a formal state aid investigation to determine whether illegal state aid was indeed involved. The CJEU confirmed the infringement of its rights and annulled the Commission’s decision and ordered the Commission to pay EGBA’s costs for its appeal at the CJEU.

“We welcome the CJEU’s ruling to annul the Commission decision, and find in EGBA’s favor, but frankly speaking, we are not surprised buy it. The facts and data of this case raised serious doubts about the compliance of the Dutch licensing procedure with EU law, which should have warranted the Commission to open a formal state aid and investigation to address those doubts. We are confident the Commission will now carry out a thorough investigation, and we are ready to provide any necessary information and data. It is crucial for the Commission to uphold EU law consistently across all sectors, without fear or favor, including the gambling sector. The selective enforcement of EU law undermines the Commission’s institutional role as the guardian of the Treaties”, said Maarten Haijer, Secretary General EGBA.