The decision to grant Ladbrokes virtual betting rights in Belgium did not constitute state aid, the European Commission has ruled, in a decision that brought to an end more than five years of legal wrangling.
The original complaint in the case was lodged in 2019 by gaming operators Rocoluc NV and European Amusement Company, triggering an in-depth investigation by the European Commission, which has now concluded and found in favour of Ladbrokes’ parent company Entain.
The case centred around the operation of virtual betting in retail outlets in Belgium, as these types of games did not fall under any regulatory framework until Ladbrokes pursued them being regulated by the market.
This enabled Ladbrokes to operate virtual betting platforms in the country. However, it was alleged in the complaint that the regulator in Belgium denied multiple operators the same right when it came to operating virtuals.
Investigations by the European Commission saw a close examination of whether the arrangement breached Article 107(1) of the Treaty on the Functioning of the European Union (‘TFEU’), which focuses on state aid.
The European Commission found that exclusive rights had not been granted to Ladbrokes. Adding that the Belgian state “did not waive or forego any resources which should have been paid by Ladbrokes for operating virtual betting”.
It continued: ”On this basis, the Commission concluded that the alleged measure does not constitute state aid under EU rules.”
Key to the ruling was the fact that no payments had been officially due from Ladbrokes and there was not an official binding exclusive right for virtual betting rights.
The vindication will be celebrated by Ladbrokes, which has a significant presence in Belgium with almost 300 betting offices, and means that the firm will not be sanctioned with legacy fees.
Regulatory challenges
The news comes as Entain is faced with the fallout from serious allegations being made against its Australian subsidiaries related to possible compliance failings.
An Austrac report seen by the Australian Financial Review detailed failures which occurred at its Neds and Ladbrokes AUS brands.
According to the publication, Austrac alleges that Entain fell way short in its AML procedures specifically around betting activity of players who had significant links to drug trafficking.
Entain CEO Stella David provided the following statement to iGaming Expert about the allegations: “We are taking these allegations extremely seriously and continue to fully cooperate with Austrac. We are committed to keeping financial crime out of gambling and continue to play our part in supporting a well-regulated and compliant sector for our customers, stakeholders and the wider community.”
