Reflecting a significant shake-up within the Dutch gambling industry, a recent court decision has brought into question the monopolistic grip of the Nederlandse Loterij on the nation’s lottery system. As the domestic gaming scene grapples with evolving regulations and legal challenges, this ruling stands out as a potential watershed moment.
The challenge to the established order was brought to the forefront when two businesses, whose applications for instant lottery, sports betting and lottery licenses were rejected by the Dutch gaming authority KSA on September 4, 2022, took legal action. The companies, identified by regional newspaper Brabants Dagblad as Jack’s Casino and Jacks.nl, are owned by JVH Gaming.
The KSA had defended its actions by citing the country’s policy that gambling licenses, such as the one granted to Nederlandse Loterij, can be issued exclusively to a single legal entity, thereby maintaining the monopoly structure. According to the KSA, this framework was “horizontally consistent” with national gambling policies.
However, the businesses contended that this consistency had evaporated since the introduction of the Remote Gambling Act (KOA) in October 2021. Additionally, they referred to rulings from May 2, 2018, and March 10, 2021, which on one hand endorsed the preserved status quo on monopolies for sports competitions and instant lotteries, while on the other hand, allowed for the maintenance of the lottery monopoly alongside issuing permits for charitable lotteries, raising issues of policy coherence.
Delving deeper into the claimants’ challenges, the court scrutinized the merit of the KSA’s justifications grounded on the KOA. The judges concluded that current regulations were misaligned with Article 56 of the Treaty on the Functioning of the European Union (TFEU), which prohibits restrictions on service provision between EU member states.
The implications became more pronounced as the court decisively opined that the Dutch gambling policy was now “no longer horizontally consistent.” The ruling highlighted a paradox in policy application where land-based gambling, perceived to have a lower risk of addiction and criminal activity, is bound to a stringent single license system, whereas online gambling—which ostensibly poses higher risks—is subject to a more liberal, open licensing system. This inconsistency clashed with the legal framework and real-life impacts following the KOA, igniting a legal contradiction that could no longer stand.
The court did not accept that a monopoly licensing system was intrinsic to the protection of public interests, which includes customer protection and the operation of land-based gaming. It was judged as disproportionate, failing to systematically ensure the overarching objectives of gambling regulation.
In what could be seen as a bold move, the court stated that the KSA had overstepped its authority by refusing the licenses based on the existing monopoly approval granted to Nederlandse Loterij. Consequently, the KSA now faces a 12-week deadline to reassess the license applications it previously rejected.
Recognizing the gravity of their decision, the court was mindful of “major consequences” that this ruling implicates for the licensing of the three country-based games of chance. Additionally, KSA was ordered to pay €1,750 in court costs to the businesses, as well as their €365 court filing fee.
For now, the Dutch Lottery still maintains the monopoly across its three segments—Krasloten, Toto, and Lotto. Nevertheless, this judgement throws the future of this monopoly into uncertainty, potentially opening the market to new operators and altering the course of the Dutch gambling landscape in important ways.
