Ladbrokes, one of the largest gambling brands in Great Britain, is facing an investigation on behalf of the European Commission. The London-based gambling company that became part of the betting giant GVC Holdings in 2018 is now being probed by the European regulators for allegedly monopolising the online sports wagering market in Belgium.
The investigation aims to establish whether or not the UK-listed gambling company indeed has the exclusive right to offer virtual betting services on the Belgian market. The probe was launched following complaints from two other gambling firms after subsidiaries of the UK-based company were granted permission to offer digital wagering terminals across Belgian stores.
At the beginning of 2014, Ladbrokes’ Belgian outfit Derby SA, a subsidiary of GVC Holdings, was given the green light to offer retail virtual wagering via digital kiosks, available at more than 300 local stores. In March of the following year, Ladbrokes also gained an exclusive right to operate its online betting services on Belgian soil.
Rival gambling companies, interested in penetrating the Belgium market, were denied the same permits in 2015 and 2016, the European Commission revealed in a press release yesterday. Subsequently, the denied companies filed complaints with the European Commission in March 2019, protesting this is against the EU principles of competition.
Such Practices May Be Contrary to EU Competition and State Aid Rules, the EC Says
The European regulator expressed its concerns that the authorisation Ladbrokes has received may have resulted in the gambling firm having exclusive rights to run virtual wagering in Belgium over the last six years. The operator enjoyed these rights without remuneration of the Belgian state. According to the European Commission, such practices may be contrary to the European Union’s rules for competition and state aid.
This is not the first time the UK-based company’s subsidiaries are in the spotlight or face legal challenges. One prime example occurred in the summer of 2017 when Derby SA’s Belgian license for virtual wagering expired. Despite this, the betting firm continued to service local customers until the spring of the following year.
This attracted the attention of the Belgium Gaming Commission and caused it to demand from Ladbrokes to suspend its operations on Belgian soil for a period of 24 hours. This penalty was enforced on September 3, 2018. Another legal challenge for Ladbrokes occurred when the Belgian Coffee Federation complained that the profits from its bingo operations have suffered a 50% decline.
By contrast, the betting shops of Derby SA allegedly accounted for one-third of the company’s profits from virtual kiosks. As a result, the Belgian Supreme Court ordered the gambling operator to cease with its virtual operations and threatened Derby SA with a monetary penalty of €10,000 per violation, with a ceiling of €1 million. In the summer of 2019, the Brussels Court of Appeal approved the Belgian Court ruling but lifted the €1 million ceiling on the penalty.
- Author
Olivia Cole
