Proposed Dutch Law Could Limit Online Gambling To Local Sites

Posted on October 23, 2017 - Last Updated on September 22, 2020

[toc]The new coalition government in the Netherlands may soon insist that all online gambling operators offering services to the country must have a ‘physical presence’ within it.

This could mean that every online gambling provider would have to, at the least, set up a local branch office within the Netherlands. This creates new tax liabilities.

Although this change potentially falls foul of European Union trade rules, it is expected to be a requirement of the country’s new coalition government. That coalition formed this week.

The four Dutch political parties forming the coalition are:

  • The VVD (People’s Party for Freedom and Democracy)
  • D66 (Democrats 66)
  • CDA (Christian Democratic Appeal)
  • Christian Union

The four parties created the ‘confidence in the future’ policy program, which includes brief mention of online gambling regulation .

The program comes seven months are Dutch voters went to the polls to vote in the March national election.

What does this mean for online gambling operators?

As previously stated,most expect that there will be no licenses for Dutch online gambling licenses unless that maintain “some form” of physical presence within the country. For example, setting up local branch offices.

However, this statement is rather vague. It could also imply that online gambling operators simply must reposition their Dutch-facing servers within the Netherlands.

Moreover, although it’s unlikely to be the case, the policy could also potentially shut out many operators. It would if it limited online gambling licenses solely to those that are already based in the Netherlands.

We won’t know for sure until the Dutch Senate begins to debate the country’s Remote Gaming Bill. It has stood since its approval by parliament’s lower house more than a year ago.

CDA previously opposed the bill. The newfound supports seems to be the reason for the ‘physical presence’ requirement now. Hopefully by introducing this, the CDA won’t obstruct the senate, where the party holds the second largest majority of seats.

Does this impact online gambling elsewhere in Europe?

In the past, the European Commission (EC) opposed European Union (EU) countries that introduced online gambling laws including requirements to establish local operations.

Poland is one such example. The EC threatened to sanction the country until it removed its requirement for potential online gambling licensees to set up “permanent establishment” within Poland.

Online operators within the Netherlands have already been punished, perhaps unjustly. The Netherlands’ Kansspelautoriteit regulatory body handed out six-figure fines to online operators licensed in other EU markets who continued providing their services to Dutch users.

Back in July, online gambling operator Betsson AB asked the EC to punish the regulatory body for issuing these fines, as it deemed the country’s online gambling legislation to be in limbo.

According to Betsson AB, the Netherlands is likely to begin issuing online gambling licenses in mid-2019. However, depending on what the ‘physical presence’ actually requires, the process could take even longer.

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Jack Stanton

Jack Stanton is a freelance journalist and marketing copywriter, specialising in the world of poker and online gaming. Jack's work has appeared on VICE, The Guardian, The Drum, PokerStars Blog, PocketFives, BLUFF Europe and more. As a live poker reporter, Jack has covered events in locations as far afield as the Bahamas, Chile, South Korea, Brazil, and all across Europe.

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