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The Court of Justice of the European Union (CJEU) has definitively dismissed the Netherlands’ appeal in a decade-long dispute concerning the extension of its gambling monopoly licenses. The ruling confirms that the European Commission did not adequately scrutinize whether the 2014 decision to prolong exclusive betting and lottery rights in the Netherlands could constitute state aid under EU rules.
The case arises from the Dutch government’s decision to extend several gambling licenses without launching a competitive tender process. In 2016, the European Gaming and Betting Association (EGBA) filed a state aid complaint, arguing that the monopoly arrangement provided incumbent operators with an unfair economic advantage. Following a preliminary review, the European Commission closed the case in 2020, asserting that no state aid was present. EGBA challenged this closure, and in 2023, the EU General Court annulled the Commission’s decision, ruling that the proper procedural investigation had not been conducted.
Next Steps: Commission to Reassess Dutch Licensing Regime
The CJEU’s recent judgment, delivered on Thursday (Case C-59/24 P), upholds the General Court’s reasoning. While the Court did not determine whether the Dutch license extensions constituted illegal aid, it confirmed that the Commission had failed to properly assess whether the measure conferred an indirect advantage on the license holders or the charitable bodies to which they were required to remit part of their proceeds. The case now returns to the Commission, which is expected to reopen its examination and decide whether a formal state aid investigation is warranted.
This ruling comes more than a decade after the original license extension in 2014, which allowed incumbents to retain exclusive rights without competition. The EGBA maintains that this practice gave operators an unfair advantage and created market distortion, while Dutch authorities argue that revenues were properly channeled to designated causes and that the extensions were consistent with national policy objectives.
Implications for the Dutch and European Gambling Market
Industry observers note that the decision highlights the procedural rigor required under EU state aid rules. Even historical licensing decisions are now subject to scrutiny if the Commission did not fulfill its investigation obligations at the time. The ruling may have practical consequences for the Netherlands, including potential recovery orders or adjustments to future licensing procedures to ensure compliance with EU law.
EGBA welcomed the CJEU judgment, calling it “a clear victory for the proper enforcement of EU law.” The association emphasized that “the Commission must investigate state aid complaints thoroughly and cannot take shortcuts.” It further noted that “Member States must ensure there is a fair, open, and competitive process when issuing gambling licenses, in line with EU law.”
The case underscores the importance of transparency and compliance in the regulation of gambling markets and reinforces the principle that monopoly arrangements must always be scrutinized under EU competition and state aid rules, regardless of their age.
For the Dutch authorities, the ruling signals renewed regulatory oversight and a potential need to revisit both past and future licensing practices to ensure they align with EU expectations and legal standards.
Source: SiGMA News
