Netherlands officials have been collaborating to gather enough information to renew their online gaming laws which also comprise the provisions required to fully regulate the activity. Although the bill has moved forward and the language has been approved by the Dutch Council of Ministers, the government continues to receive pushback.
With implementation of the new law tentatively set for January 1st, 2015, legistaltive approvals across all levels may require additional time. Simultaneously, the Council of State is beginning to raise concerns which could results in amendments to the original gaming law prior to complete approval and enactment.
The bill, including all amendments of the existing gambling act, must initially pass in the lower house prior to being submitted to the Senate. At the moment, legislators are expecting the process to take until the end of 2014. However, due to the exigencies of the Dutch legislation process, the date is likely to be delayed.
Details of the Gaming Law
The new gaming laws outline the details regarding regulations toward operators, taxes and responsibilities held by the state. Operators will be able to apply for a license on the conditions that the, “primary place of business or headquarters in a State party to the Treaty on the Functioning of the European Union or the Agreement creating European Economic Area,” is legally confirmed. In other words, all online gaming companies must be in a location that has been approved by the European Union.
Also, any online gaming operator must pay attention o anti-money laundering regulations and follow all actions associated with mitigating the risks of problem gaming for Dutch-based participants. Additionally, operators will be required to prove that all player funds are segregated to protect them from operator default that may threaten overall operator assets. Therefore, players will be required to indicate the maximum limits of their gambling behavior so the state can monitor for any gambling problems.
Also, all players are encouraged to play only on sites that have been licensed by the Dutch Government which could restrict their activities to only play against other players within the country. However, the law does not specify the ramifications of playing on an international site.
The Dutch Government has set the taxation rate to 20 percent of gross revenue and a 0.5 percent contribution from all operators to ensure treatment and additional research for gambling addiction. Furthermore, an additional 1.5 percent fee will be paid to fund Kansspelautoriteit, the regulatory body that will be managing all online gaming activities in the Netherlands.
There is currently a 29 percent gross revenue tax for all land casinos which will remain at the same rate. The Dutch Government has decided to sell 14 casinos that are operated by Holland Casino. The first 10 will be sold as a group and the other four will be individual sales. This will occur within the next year and must adhere to non-monopolistic regulations that will be part of this new gaming law.
Council of State Pushback
The Netherlands Council of State makes recommendations on any bill draft. With the new gaming bill, the Council has balked because they feel as though gamblers may not switch to licensed sites for those that are unregulated. Also, the Council would like to have more stringent rules for the entire gambling industry.
The Justice Ministry also criticized Internet gambling deregulation and dissolving the state monopoly, which the Council agreed. Those supporting disbanding the state monopoly and implementing the new law have guaranteed that around 80 percent of online gamblers will switch to licensed operators but the Council continues to have doubts given the international character of online gaming. They also contend that there is a limited effect of rules that only affect the Netherlands and a difficult enforcement of the rules.
In the end, the Council of State has urged legislators to reconsider the proposals offered in the new bill including the tax rate because it is so much different than land-based casinos. Discussions will continue within the Netherlands Government to resolve the many differences between internal departments and move forward with the proposed regulations so that a decision is made by December 31st, 2014.
Given the many requests from the Council, experts do not believe a decision will be made prior to the end of 2014. Instead, they are anticipating the law being amended several times to accommodate the internal concerns. Once approved, Dutch online gamblers will have many casino options to enjoy from the comfort of their own home.