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Extension of gaming concessions valid if justified by reasons of general interest

This is how the Court of Justice of the European Union ruled on the extension of concessions in the gaming sector in Italy

On 16 March 2023, the Court of Justice of the European Union ruled in Case C517/20, OL on the interpretation of articles 49, 56 and 106 of the Treaty on the Functioning of the European Union (TFEU). This request had been submitted in the context of criminal proceedings brought against OL, owner of the company of the same name, for an alleged violation of Italian legislation on the collection of bets for having carried out an organized activity on behalf of an established bookmaker in Austria without being the holder of a concession and a license required by that legislation. The Court first recalled that if a company, established in a Member State, pursues the activity of collecting bets through agencies established in another Member State, the restrictions imposed on the activities of these agencies constitute obstacles to the freedom of establishment enshrined in Article 49 TFEU. Furthermore, Article 56 TFEU concerns services which a provider, established in a Member State, offers without travel to recipients established in another Member State, so that any restriction on such activities constitutes a restriction on the freedom to provide services by account lender. In particular, an extension of concessions in the gambling sector prevents them from being opened up to competition and from verifying the impartiality of the award procedures in question, thus integrating a difference in treatment, to the detriment of companies located in another State Potential member to such concessions, which is prohibited, in principle, by Articles 49 and 56 TFEU, and which violates the general principle of transparency as well as the obligation to ensure an adequate level of publicity. However, such an extension may be allowed on the basis of the derogations expressly provided for in Articles 51 and 52 TFEU, or it may be justified by overriding reasons of public interest. In this respect, the objectives of consumer protection, the prevention of fraud and the incitement of citizens to excessive spending in connection with gambling, as well as the prevention of disturbances in the social order in general, are among the overriding reasons of general interest susceptible to justify restrictions on the fundamental freedoms enshrined in Articles 49 and 56 TFEU. Furthermore, if the Member States are free to set the objectives of their gambling policy and, possibly, to precisely define the level of protection sought, the restrictions imposed by them must none the less satisfy the conditions resulting from the jurisprudence of the Court as regards their proportionality.