With
the new Remote Gambling Act (in Dutch: Wet
kansspelen op afstand), online gambling will soon be legalized in the
Netherlands. Operators of online games of chance can most likely apply for a
license per 1 July 2020. As a result of the new legislation, providers of
online betting can also apply for a licence. In addition to the ‘general’ risks
of gambling addiction and fraud, the provision of online betting entails a
particular risk: the risk of match fixing. In this blog we will discuss the
rules to prevent match fixing under the new legislation.
Introduction
Online
games of chance, also referred to as remote games of chance, are games of
chance in which the player participates online and without physical contact
with (the staff of) the organizer of the games of chance. Currently, online
games of chance are offered on a large scale illegally. In order to deal with
this effectively, a licensing system has been created. At this moment, the Ministry
of Justice and Security is working out the details of the legislation. The
Senate approved on the Draft Bill on Remote Gambling on 19 February
2019. The Netherlands Gambling Authority (hereinafter referred
to as ”NGA”) expects that it will be possible to submit licence applications
from 1 July 2020, with the online gambling market opening on 1 January 2021.
Games
of chance are subdivided into the following categories on the basis of their
characteristics and the associated risks: 1. casino games in which the players
play against the licence holder; 2. casino games in which the players play
against each other; 3. sports betting; and 4. betting on the results of horse
races and harness races. The rules for online games of chance against match
fixing apply to categories 3 and 4 (hereinafter referred to as “sports
betting”).
What is match fixing?
In
the Netherlands it is only allowed to organize bets for sports bets (category 3
and 4). Other forms of betting, such as betting on election results, betting on
the winner of the song festival or on the date of birth of a new prince(ss) are
(and remain) prohibited.
Characteristic
for sports betting is that the outcome of the game of chance is not determined
by a random generator, but by the outcome of a sports match or events during
sports matches. This entails the risk of manipulation. Match fixing involves
athletes who manipulate matches, whether or not forced to do so, aiming to gain
a financial advantage from made bets. Because of the risk of match fixing, the online
gaming legislation pays special attention to preventing match fixing and
protecting the integrity of the sport.
Rules to prevent match fixing
There
are currently two licensed sports betting providers: Toto (part of the Dutch
Lottery) and Sportech Racing (organiser of harness racing and horse racing). This
will change with the new Remote Gambling Act. All providers of sports betting will
soon be able to obtain a license and are subject to the supervision of the NGA.
The rules to prevent match fixing are currently being worked out in subordinate
legislation. We discuss a number of important requirements below.
Analyse for manipulation
It is not always clear
whether games and competitions are sufficiently professional to be able to
conclude sports bets responsibly. Therefore, the licensee should analyse
matches for anti-manipulation safeguards before
offering any bets. In its analysis, the provider must consider a number of
interrelated aspects, including the extent to which (i) the outcome of the
match is relevant to the competition of the sport in question, (ii) players are
paid in a timely and adequate manner, and (iii) there is objective reporting of
the match.
If
the risk assessment gives rise to facts or circumstances indicating possible
manipulation of a match, the licensee must take appropriate action and inform
the NGA. It is up to the licensee to determine the nature of the measures to be
taken in accordance with the risk identified. A possible measure is be that no
bets may be organised on a specific match.
Matches
on the ‘white list’ are excluded from the analysis. These matches are assumed
to be organised sufficiently professional. Examples are the highest divisions
and big cup tournaments in football, hockey, basketball and darts. However,
this does not relieve the licensee of the obligation to analyse the course of
the bet for any noteworthy and suspicious transactions and patterns, during and
after the betting period.
Prohibited matches
Certain moments of play
have an unacceptable risk of match fixing. These moments of play, listed on the ‘black list’, are prohibited for betting. These include: winning or losing individual
games or a set in tennis, a public warning in boxing, a first throw-in, fouls,
yellow or red cards in football.
Amateur
games are prohibited as well, because they do not offer sufficient guarantees
against manipulation. Furthermore, it is not permitted to organise bets on
youth games, on matches where there is no objective reporting or if the outcome
is of no relevance to the competition of the sport in question.
Monitoring gambling patterns
The licensee should
monitor its offer of sports bets for notable and suspicious gambling patterns
that may indicate the manipulation of matches. The licensee must immediately
report (possible) irregularities to the NGA’s Sportsbetting Intelligence Unit
and to the sports federation that organises the match in question. If
necessary, the licensee must take additional measures, such as limiting the money
staked or withdrawing the bet.
Integrity policy
The licensee must draw
up an integrity policy. The policy of the licence holder should aim at
combating match-fixing in relation to betting, by detecting suspicious gambling
patterns or other gambling related signals that indicate possible match-fixing.
Furthermore, the licensee should take appropriate measures to avoid any
conflict of interests and to prevent the misuse of inside information.
Collaboration
In order to prevent and
combat the manipulation of competitions and the related risks, a good
information position of the various parties involved is of great importance.
The licence holder must therefore cooperate and exchange information with,
among others, the organisers of the matches, the sports organisations involved,
the Dutch National Platform for Match Fixing and internationally operating
partnerships such as the European Sports Security Association (ESSA) and the
European Lotteries Monitoring System (ELMS).
Accountability
The licensee must set
up its game system in such a way that it can account at all times for, among
other things, the way in which the risk analyses were carried out, what the
findings were and, if applicable, what action(s) it has taken as a result.
Conclusion
After
the Ministry of Justice and Security worked out the details of the legislation,
the definitive licence conditions can be drafted. It is not yet known
whether the online gaming and betting market opening of 1 January 2021 will remain
feasible. In the meantime, potential providers are advised to keep updated on
the news of the NGA and to prepare as much as possible in applying for a
license. We refer to the information from the NGA for potential providers in
the Q&A here. If
you would like to receive more information about a license application or match
fixing, please contact Thomas
van Essen or Nina
Lodder.
