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EU court upholds Sweden online gambling ban

The EU Court of Justice (ECJ) [official website] on Thursday upheld a Swedish law [judgment text] restricting Internet gambling. The suit was brought by the publishers of two Swedish newspapers, Expressen and Aftonbladet, which both ran online gambling advertisements for several foreign agencies in 2004. The Swedish lottery law in question prohibits the promotion of Internet gambling by private operators in other EU member states for profit. The publishers were prosecuted under the lottery law and fined 50,000 Swedish crowns. The publishers appealed the judgment, and the court sought guidance from the ECJ to determine whether the Swedish lottery law was compatible with EU law on service provisions and games of chance [Article 49-EC text, PDF]. The ECJ held that bans on Internet gambling were acceptable for cultural, moral or religious reasons, but there should be no discrimination. The court concluded that Sweden's ban on Internet gambling was in line with EU laws, but that the nation's lottery laws were not allowed to penalize foreign gambling agencies differently from domestic agencies.

The judgment comes at a time when the multi-billion euro industry is attempting to break the monopoly held by domestic "game of chance" agencies in many EU member states. In June, the ECJ issued two judgments [JURIST report] against UK betting companies Ladbrokes International and Betfair [judgments], upholding Dutch restrictions on Internet gambling. The ECJ ruled in both cases that national regulations on games of chance are compatible with EU law when they are enacted to mitigate addiction and combat fraud. The US has also taken recently taken steps to tighten restrictions on Internet gambling. Official federal enforcement of the Unlawful Internet Gambling Enforcement Act (UIGEA) [HR 4411 materials] began in June. The UIGEA, which bans banks and financial institutions from intentionally accepting payments from credit cards, checks or electronic fund transfers related to unlawful Internet bets was scheduled to take effect on December 1, 2009, but enforcement was delayed [JURIST report] in November until June 1. The delay allowed US banks and financial institutions six months to get in compliance with the new rules designed to curb Internet gambling. The act was signed into law [JURIST report] by then-president George W. Bush in October 2006 amid controversy over the effects of the bill on US bettors and foreign companies.

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