Will French Courts Ban Foreign Online Gambling Operations?

February 19, 2010 | News Category: Gaming Law

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Online gaming companies in France have grouped together, and spoken out against those online gaming companies that have allowed residents of France to play in their online casinos. At this time, it is considered to be against French law to accept residents as customers at online casinos, unless the online casinos have been approved or regulated in France.

There are three French online gambling companies, Joagroupe, Tranchant, and Barriere, who have joined together to sue at least 14 online gambling operators, regarding this issue. The three companies have also lodged a request with Paris’ Criminal Court to put a block for at least two years against these online casino operators with regards to licensing. Essentially, the three companies have asked that these companies will not even be considered for French licensing for the next two years.

France is meant to be opening up its online gaming market in order to comply with the European Union regulations regarding free trade within the EU. Although this has not yet taken place, Joagroupe, Tranchant, and Barriere are hoping that the 14 online casino operators that have already allowed French citizens to use their online casinos, will be penalized for doing so. Should the court agree, these companies will not be allowed to request licensing in France once the market opens up.

Although the European Commission has directed France, amongst other non-compliant EU states, to open up their online gambling market, there are certain cases in which an EU member nation is allowed to ban foreign gambling operators. The European Court of Justice has agreed that action such as this can be taken only in special circumstances.

Should the 14 online gambling operators be banned from receiving French licensing for two years, it seems very reminiscent of what has been occurring in the United States, where foreign gambling operators get penalized for operating while the online gambling market is still closed in that country.

Should the three French companies obtain their desired ruling from the Paris Criminal Court, some well known names in online gambling may well be banned, such as Unibet, Sportingbet, and bwin, amongst others.

No doubt, there will be questions as to whether a French court has jurisdiction over services that are allowed throughout the European Union since the European Treaty governs the EU. On the other hand, the French companies are likely to argue that the 14 online gambling operators purposely entered the market before it was lawfully opened up, and chose not to wait for official licensing procedures.