Blenheim Talks | Ondermijning
Read our article about: License remote gambling Netherlands
The remote gambling bill has been accepted by the Dutch senate on the 19th of February 2019. This enables a licensing system for remote gambling. Online gambling providers will soon be able to file a request to offer their online products in the Netherlands. The Dutch gambling authority KSA will grant licences from mid-2020 onwards. The license specialists from Blenheim advise during the requesting-process and the Bibob screening. The online gambling law has strict requirements, including ones about addiction prevention. Hereafter a few requirements from the ‘decree remote gambling’ will be further explained, focussing on the representative that a provider in the Netherlands has to appoint, as well as the addiction policy held by a license holder.
The timeline from the 20th of February 2019 until the eventual licensing for online gambling in mid-2020 is as follows:
The Ministry of Justice will further work on a governmental decree (AMvB); and there will be a ministerial regulation (MR);
The gambling authority will transform the ministerial regulations into license requirements;
The gambling authority will design an application form. Consultation is possible on this. Involved parties can comment and offer suggestions;
There will be a formal date for the entry into force of the online gambling law and from that moment onwards the gambling authority will start taking license applications.
After being granted a license by the gambling authority, providers can start offering its products on the Dutch market.
Because of the remote gambling law, a new title will be added to the gambling law (hereafter: ‘Wok’) after article 30aa. Besides that, there is an AMvB ‘Decree upholding provisions on the execution of the remote gambling law’ (hereafter: ‘decree remote gambling’). This AMvB has been published for consultation on the 11th of September 2018 and will be discussed below. In a lot of articles it is mentioned that further rules will be issued through ministerial regulation. Since this ministerial regulation has not been published yet some of the exact requirements are not clear as of now.
Below is a summary of the requirements that need to be met by a potential foreign company to qualify for a license. The license system is very thorough and it would be wise to be advised on the definitive ‘decree remote gambling’ by a Dutch license-lawyer. No matter what, for the license there has to be a reliable, controllable organisation with an eye for addiction prevention-policies and that can connect with the CRUKS-register. Nevertheless there are some requirements still to be worked out by Dutch ministerial regulation.
For the potential foreign applicant of the license it is important that he/she is located in a European state, or can request an exemption. The required presence of a representative on behalf of the foreign applicant in the Netherlands can be a Dutch lawyer, as long as this lawyer is expert in gambling addictions. This does not require a specific degree, however sufficient knowledge of Dutch addiction institutions is required. He also has to be available for consultations with Dutch (help)organisations, and he has to be up to date with the goings within the licensed company.
Concerning the addiction prevention policy, it is important that risk-analysis is made and that the addiction prevention policy is tuned to the outcome of this analysis. Besides that, players have to be signed up at the company, their identity checked, and checked whether they are not registered with the CRUKS-register. The license holder has an active duty of care to analyse the players’ behaviour and advise them to register for the CRUKS-register if needed. If the player does not do this voluntarily, then the license holder has to report this to the gambling authority.
Based on article 31a, the gambling authority can grant licenses for organising remote gambling. These licences will be valid for 5 years and are non-transferable. Despite this, the license can carry over by other means than a transfer. Written permission from the gambling authority is needed for this, based on article 2.3 of the ‘decree remote gambling’.
Article 2.1 sub 3 of the ‘decree remote gambling’ states that further rules concerning the licensing of organising remote gambling, and how to organise this, will be issued by ministerial regulation. The ministerial regulation has not bee published yet so the requirements are unclear at this point.
Technical requirements that are made will be about the way the license holder connects to the Central Register Exclusion Gambling (CRUKS), the way he designs his control database, and the way the application and registration of the player will go. Besides that, there are a few organisational requirements, which I have explained below under the header ‘license holder’, ‘representative’, as well as ‘addiction prevention policy’. No matter what, there has to be a reliable organisation on the ground of article 31h.
Based on article 31c Wok, a license will be refused if:
The applicant does not meet the set requirements from the Wok;
Monitoring compliance and enforcement of the Wok, the money laundering & terrorism financing prevention law, the sanction law 1977, and the gambling tax law cannot be done effectively.
The Dutch license for organising remote gambling can be revoked on the ground of article 31d Wok, if:
The applicant provided incorrect information which otherwise would have led to a different decision concerning the granting of the license;
The applicant does not, or no longer does, meet the requirements set out in the Wok, the money laundering & terrorism financing prevention law, the sanction law 1977, or the in the gambling tax law set out rules;
A provision or limitation in the license has been breached;
Insufficient cooperation has been given to the monitoring of compliance and enforcement of the Wok, sanction law 1977, or the gambling tax law.
If there are serious suspicions that there are grounds to revoke the license, the license can also be suspended, see article 31d sub 2 Wok.
Article 31g Wok states that the license holder must have its registered office, central management, or headquarters in a European state (or at least that the state is part of the TFEU or the EEA agreement). In an earlier coalition agreement the government stated that licenses would only be granted if the applicant was located in the Netherlands. However, this has been revoked since this could obstruct the right to freedom of movement.
For all license holders the following requirements are stipulated in article 31g:
The license holder has the company structure NV (PLC) or BV (LLC) within a European state.
The license holder provides information concerning the ownership and control structure of his company, concern the company belongs too, and the concerned party.
The license holder is not connected to a person in a formal of factual control structure who:
The license holder needs a capable compliance officer within the organization who is tasked with the internal monitoring of the compliance with the rules following from the Wok.
Exception is that, based on article 31g sub 5, an exemption can be given by the Dutch gambling authority for companies that are located in a non-European state, given that the laws of the non-European state provide enough assurance concerning the values that are being protected in the Wok. Article 3.1 from the ‘decree remote gambling’ states the requirements for an exemption as mentioned in article 31g sub 5.
It has to be a responsible, reliable, and controllable organisation. The laws of the state where the company is located have to be similar to the laws in the Netherlands in the following fields:
Monitoring of the compliance with the provisions must take place in the non-European state.
The laws of that state may not oppose organising the licensed gambling as arranged in Dutch legislation.
The exemption can only be granted if the license holder organises the licensed gambling fully or partially from a branch in the Netherlands. This branch needs to be registered in the business register.
In that branch, economic activities have to take place (to be able to register on the business register). Besides this, the legislator does not set other requirements for the activities that take place.
Whether or not the representative can be a lawyer in the Netherlands depends on whether the representative is expert in gambling addiction and addiction prevention. The representative has to be fully informed by the license holder and has to be able to represent the license holder. He/she has to be available for consultation in person when requested.
The legislator prescribes that all license holders, regardless of the location, must have a representative in the Netherlands. The legislator considers it necessary for the correct execution of the addiction prevention policy and the appropriate compliance with the Dutch addiction care system. Only when the representative is present in the Netherlands can he work effectively with the Dutch experts in addiction prevention and care. This representative has to be available for consultation in person with the gambling authority and other relevant institutions operating in the Dutch addiction prevention and addiction care field. The representative has to be authorised to make decisions on behalf of the license holder in that field. He has to be expert in gambling addiction and addiction prevention, and has to be constantly informed on the relevant intends and decisions from the license holder, as well as being informed about the findings and advices from independent officials who apply risk-analysis on the gambling offers by the license holder.
Article 4.1 of the decree remote gambling sets out the following requirements for a representative. The license holder has to appoint one or more representatives who:
In the Netherlands, with the proper execution of the set out requirements by law concerning gambling addiction in mind:
Are expert in the field of gambling addiction and addiction prevention;
Are informed at all times about the intends and decisions from the license holder, as well as the findings and advices from officials;
Speak the Dutch language, or another for the gambling authority understandable language.
The details concerning the representational powers have to be posted on the website of the license holder, and the website of the gambling authority.
Further rules concerning the representatives’ activities will be laid out in ministerial regulation. This regulation has not been published as of today. Work on the license holders’ organisation by the representative can be outsourced based on article 4.3 of decree remote gambling, as long as the compliance with the law is sufficiently assured, and the monitoring of the compliance is not hindered by appointing this third party.
Concerning the expertise of the representative appointed by the license holder, the legislator said the following in the explanatory memorandum of the ‘decree remote gambling’:
He needs to be up to date with the types of help that can be given to different kinds of players, and what this help entails;
The representative has to be up to speed with the usual practice in the healthcare system in the Netherlands, as well as the way referrals to help is organised, whether this help is directly available (or whether there are waiting lists), and what the costs are. This information is necessary to refer the player to the appropriate help.
The representative has to be up to speed with relevant developments and new scientific insights in the field of addiction prevention.
The information that the representative gains in the network has to be implemented effectively in the addiction prevention policy, for instance in prevention courses, informing players, and developing interventions.
The representative needs to have necessary information concerning the gambling offers, the addiction prevention policy, the marketing policy, and the recruitment policy of the license holder, and how this is executed within the organisation of the license holder.
Concerning the addiction prevention policy, most provisions will be laid down in the ‘decree recruitment, advertisement, and gambling addiction prevention’. This decree already exists, and due to the ‘decree remote gambling’ a few provisions will be added and/or amended. These amendments can also be found in the ‘decree remote gambling’.
The Dutch license holder has an active duty of care to help the online gambling player as much as possible in taking its own responsibility. In order to do this, the license holder has to work together with experts in the field of gambling addiction and create, implement, and maintain an addiction prevention policy. In that policy he uses the player profiles and the multi-stage prevention model. The final piece of the addiction prevention policy is the Central Register Exclusion Gambling (CRUKS). By registering itself in that register, whether it is voluntary or not, means the player can be excluded from remote gambling.
The Netherlands multi-stage prevention policy is based on scientific research and is consistent with recommendations by the European Commission. By intervening in an appropriate way, the license holder can prevent a player that is showing risky behaviour from becoming a problematic player. It also means that problematic players can be referred to the appropriate help. These interventions need to be proportional to the severity of the detected behaviour. Examples of interventions are: pop-ups that inform players of the dangers of gambling addiction and pop-ups that interrupt the game to point out the possibility of a (temporary) registration in the CRUKS register.
Each player of a remote game operated in the Netherlands has to be registered with the license holder before he can start playing. The license holder first has to identify the player to do this. This person has to be 18 years or older, can’t be registered in the CRUKS-register, and has to specify the limits of his gambling behaviour. The BSN-number is used here. The limits of ones gabling behaviour are explained in article 4.13 of the ‘decree remote gambling’, and specifies what these limits must entail, including the maximum amount of credit, the amount of deposits, etcetera.
The license holder will systematically register and analyse data concerning the gambling behaviour of the player. The license holder can use health data in order to do this, as far as this is necessary to prevent excessive participation in gambling, or gambling addiction.
When there is a reasonable suspicion of excessive gambling or gambling addiction, the license holder will investigate the players behaviour in a personal interview with the player. If the license holder, based on the interview, concludes that the player might cause damage to himself or others around him because of the excessive gambling, he will advise the player to temporarily exclude him from playing and registration into the CRUKS-register. If the player doesn’t register with the CRUKS-register voluntarily, then the license holder has notify the gambling authority of this. The gambling authority can then, based on article 31da Wok, register the unwilling player into the CRUKS-register, which means the player temporarily (6 months) can’t play anymore.
Article 6 of the ‘decree recruiting, advertisement, and gambling addiction prevention’ states: executives and people in key positions within the license holder’s company possess the necessary knowledge and insight to operate the license respecting the special social responsibility that comes with it. This knowledge at least includes:
The risks of gambling addiction that come with the licensed gambling games;
Gambling addiction, the negative consequences of gambling addiction, and the behavioural characteristics of gambling addicts;
Assistance with gambling addiction;
The law and other regulations concerning gambling, and;
The codes of conduct applicable within the sector.
Concerning the exact requirements of the addiction prevention policy, and the interpretation of article 6 of the decree, further rules will be issued via ministerial regulation.
Article 7 of the ‘decree recruiting, advertisement, and gambling addiction prevention’ states that
A license holder will ensure that in his organisation there will be cooperation with experts in the field of addiction care and experiential experts to develop, apply, and maintain an addiction prevention policy that meets the requirements set out in this chapter, as well as the Dutch addiction care system. In the addiction prevention policy there will be extra attention for:
The available gambling addiction prevention measures and services, and when and how these will be used;
The quality assurance of this policy;
Addiction prevention for young adults in the age category of 18 to 24.
The license holder must at all times possess over an up-to-date, reliable, and scientifically approved analysis of the addiction risk imposed by the organised gambling games. The addiction prevention policy will be tuned to the detected risks from the analysis.
The legislator submits that this means that the license holder has to apply preventive measures and services that fit the detected risk level, for instance by monitoring and intervening more at high risk games. These measures can for instance see on lowering the risk factors in the games, by lowering the jackpot or interrupting the game more often using pop-ups so that the possibility to play on is limited.
This risk analysis has to be executed by one or more officials who possesses the expertise, knowledge, and authorisations to perform this analysis effectively. The license holder has to guarantee a functional divide between the board and the execution of the risk analysis. The legislator considers that this provision is to prevent conflicting interests. The legislator emphasises that it is just the protection of the player that is being pursued. This means that the official executing the analysis is not obstructed by other (financial) interests of the license holder.
Further rules concerning the addiction prevention policy, the analyses, the frequency, and the content of the reports to the gambling authority will be set by ministerial regulation. The regulations that the license holder has to comply with will most likely be even more complex because of this. A specialised gambling lawyer can assist the license applicant with the handling of the application.
Based on these articles the license holder has to offer information concerning addiction and addiction care to the players. This information includes that the addiction prevention policy of the license holder as well as the Dutch addiction care have to be made public. Further rules can be set by ministerial regulation concerning this.
Gambling lawyers with Blenheim can help you out with gambling licenses. Operators who have a license in other countries will be accustomed to the hassles concerning license renewal. These hassles won’t be any different in the Netherlands and we as lawyers are accustomed to this red tape. The license applicant will get an integrity screening based on the Bibob law (Dutch business integrity bill). Operators who offered services in violation of the legislation can not apply for a license for a period of two years. The date of entry of this black out is probably the same as the date of entry of the law.
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