Market Update: Austria – Claus Retschitzegger (EEGReport Magazine – Issue 6 – June – September 2017)

EEGReport Magazine: Mr. Retschitzegger, you are the President of the recently established Austrian Association for Betting and Gaming (OVWG). Could you provide us with some more details of the Association, of its aims and goals and why it has been founded?

Retschitzegger: The Austrian Association for Betting and Gambling (in short OVWG) is an Austrian interest group founded in 2016, aiming to create awareness towards opinion leaders in the area of online betting and gambling in Austria. The members of the Association are leading Austrian and European operators offering online betting and gambling services in Austria. OVWG primarily focuses on the regulation of online products (online sports betting, online gambling).

In its role as representative and interest group of this sector, OVWG aims for a modern and competitive regulation of the sector that complies with EU law. This lies in the interest of all affected parties, including the operators and consumers. Furthermore, OVWG acts as voice between service providers, authorities and decision-makers in order to improve the mutual dialogue and understanding between the parties.

As you can see, OVWG covers various important areas that have not been properly addressed so far. We chose to found OVWG since it is very difficult for a single operator to bring about change. However, I am more than positive that the operators on the Austrian market can contribute to an improvement for all affected parties by speaking with one voice which can no more be ignored.

 

EEGReport Magazine: What are the objectives of OVWG?

Retschitzegger: The circumstances of the Austrian (online) betting and gambling market have changed dramatically in the last couple of years. On the one hand, the digital component has gained more ground which has brought an entirely different aspect to the market. On the other hand, (especially) the European Court of Justice has increasingly substantiated internal market regulations particularly addressing dysfunctions in the legislative system. In light of this, OVWG has made it its goal to interact with decision-makers on all levels and – by means of dialogue – to present our ideas and concepts. In a changing market, important issues could remain unsolved unless the legal framework gets constantly adapted.

The essential medium- to long-term goal of the Association is to implement a market regulation for online betting and gambling in Austria that is compliant with EU law, appropriate for existing and newly entering market players and achieving the broadest possible player protection including the channeling of consumers from the black market to the licensed and legal offer. A well-balanced, solid legal framework including a fair taxation is not only the basis for innovation and investment in the Austrian market, but also a core element for legal security for the sake of all: consumers, operators and the State.

 

EEGReport Magazine: How does OVWG intend to reach these objectives?

Retschitzegger: We want to work together with decision-makers to create a model preparing Austria for the future and securing regular, safe and fair relations between all parties. In fulfilling this aim, we do not only rely on the knowledge of our internationally active members, but also, for example, conduct studies in order to present scientifically based documentation. Such studies will be launched together with recognized institutes and will especially be addressed at the rectification of wrong facts regarding prevalence issues of betting and gambling as well as the Austrian gambling and betting market.

As we know, proper PR work makes the crucial difference between success and failure of an association. Thus, the OVWG will regularly release press reports in order to get wider visibility and create awareness of the industry. OVWG has built its own staff in order to get its daily business work done and to achieve the broadest effect possible. As the current situation requires the industry to bundle forces, the OVWG also cooperates with other Associations throughout Europe such as EGBA or ESSA. Apart from that, we constantly approach the EU Commission in order to keep it informed of any legal developments in Austria.

 

Austrian Association for Betting and Gambling

 

EEGReport Magazine: You mentioned that “fair taxation” would be part for a solid legal framework. What taxation rate would be appropriate according to OVWG and why is taxation so important for a well-balanced regulation?  

Retschitzegger: OVWG is of the view that 20% the Gross Gambling Revenue (GGR) would be a well-balanced, appropriate rate that would be for the sake of all, consumers, operators and the State; Great Britain for example has a taxation rate of 15 % on GGR, Denmark has a taxation rate of 20% on GGR.
An appropriate taxation rate is crucial since it is decisive whether the legal operators have the ability to compete with illegal operators or not. This is of utmost importance when it comes to the intended channelization of consumers from the black market to the licensed and legal offer, as otherwise a gap between legal and illegal offer is created that still channels players towards illegal offer. Only an adequate gambling and betting regime in connection with appropriate taxation rates creates a healthy and sustainable gaming industry that is capable of competing with illegal operators.

 

EEGReport Magazine: Austria’s gambling sector has been subject to debate for quite some time now. Could you quickly circumscribe the Austrian legal framework and circumstances for operators intending to access the Austrian market? What are the recent developments? 

Retschitzegger: In Austria, there is a very different legal regime when it comes to betting and gambling, with significant legislative differences. The licensing regime for betting is kept rather liberalistic while gambling is monopolistic. Even though digitization has fundamentally changed the betting and gambling market, the current legal framework for online-gambling products still has not been properly adapted. Moreover, in the field of betting we can see an increasing tendency in various Federal States (Bundesländer) to make it even more difficult for cross border operators to newly entering the market. 

 

EEGReport Magazine: You are saying online gambling and betting operators are currently facing a rather difficult situation in Austria. What is OVWG’s approach to improve this condition?

Retschitzegger: When it comes to a proper online gambling and betting regime, OVWG does not intend to reinvent the wheel. In fact, OVWG’s roadmap to achieve a fair and balanced legal framework has some good and prominent examples: If you take Denmark or Great Britain as an example, you can clearly see that an open and regulated market entails a beneficial impact for all, consumers, the state as well as for operators. Apart from these two states, the Swedish market is being transformed as well, with a broad consulting phase to create a new model. Sweden will probably be another role model for Austria where once again we will be able to experience the mentioned positive effects. In my opinion, it is just a question of time until Austria chooses to follow suit. Scandinavian states have been pioneers in Europe in various ways and they once again show us a good way that yet takes some time to be adopted in other states.

 

EEGReport Magazine: As we all know, there are different regulatory models in every jurisdiction, which makes operators look twice before entering legalized markets. There has not been a huge interest shown by the large international operators to lobby in Austria for a new regulation, do you feel that this will change in the future?

Retschitzegger: We have had various large international operators giving statements and pursuing an improvement of the legal framework in Austria, usually out of a particular occasion such as a new betting law. However, some of these big operators such as bet-at-home.com, tipico or Mr Green recognized that they have a better stand if they speak with one single voice, wherefore OVWG has been founded. In my opinion, the existence of OVWG proves that large international operators de facto intend to make a change happen in Austria.

 

EEGReport Magazine: Do you think that a common regulatory model that can be adopted on EU level would be a good practice? Economically speaking EU countries differ a lot, thus having an all-governing law in every country regarding the online gambling and betting sector could prove to be a major setback for many less developed countries in Central and Eastern Europe. This is of course my opinion, what is your expert opinion on such a topic?

Retschitzegger: This question is a very complex one and would go beyond the scope of this interview if properly answered. In my opinion, a common regulatory model – if well implemented – could be a great asset from an economical view, whereas it probably would be nearly impossible from a political view in the current situation. Thus, I do not want to lose time thinking about a scenario that is not going to happen within the next couple of years. However, it can be said that even though there is no common regulatory model, the European Union still gave us overriding legal guidelines that govern fundamental principles in regards to economical questions such as the Freedom to provide services or the Freedom of establishment. Yet, the problem is that various states are (already today) in breach of EU-law, wherefore these fundamental principles have been levered out. Instead of considering a common regulatory model, the European Union should rather consider to execute and observe the implementation of its European Union Primary Law.

 

EEGReport Magazine: Could you give us some insight about the criteria for becoming a member of OVWG?

Retschitzegger: Membership to OVWG is open for any company being active in the area of online betting and gambling and fulfilling certain access criteria. An operator must have at least one online betting or gambling license issued by a competent authority of an EU-Member State, it must maintain active player protection standards, be compliant with tax obligations in Austria and to show commitment to innovation as well as to the aims and goals of the Association. If a company fulfills these criteria it can either become a full member or an associated member. I am happy to receiving requests for becoming a member of the Austrian Association.