The French government has decided to halt its proposed plan to legalize online casinos, prioritizing the need for thorough consultations with key stakeholders and considering the potential impacts on existing land-based casinos and regional economies.
Short Summary:
- Budget Minister Laurent Saint-Martin announced the withdrawal of the online casino amendment.
- The decision comes in response to significant opposition from industry stakeholders and local mayors.
- Future discussions will focus on the regulatory framework and its implications for the land-based casino sector.
In a significant policy shift, the French government has retracted its proposed amendment to the 2025 budget that aimed to legalize online casinos. This move, announced by Budget Minister Laurent Saint-Martin, highlights the administration’s commitment to more comprehensive consultations with stakeholders involved in the gambling sector. During an interview on Radio J, Saint-Martin emphasized the need for further discussion to gauge concerns about the potential repercussions of legalizing online gambling, stating, “There was talk that the government would submit an amendment. This is no longer the case.” He underscored that the government must conduct internal dialogues to address the requirements of various stakeholders, particularly land-based casinos.
The initial proposal, set forth by the administration of Prime Minister Michel Barnier, sought to raise revenue by implementing online casino regulations. The plan included a gross gaming revenue (GGR) tax of 27.8%, alongside various federal taxes that would lead to a total effective tax rate nearing 55%. This policy could potentially inject an additional €500 million into state coffers. However, the announcement rapidly encountered fierce resistance from both the local casino sector and numerous regional leaders, resulting in the decision to withdraw the amendment.
Local leaders, including approximately 130 concerned mayors, have publicly expressed apprehensions regarding the economic implications of online casino legalization. In a joint editorial in Le Figaro, they condemned the proposal, comparing it to “opening a Pandora’s box.” Their argument centered on fears that permitting online gambling would disrupt regional economies and lead to job losses among physical casino employees. The mayors strongly advocated for a regulatory approach that reflects the existing legal framework governing traditional casinos, ensuring equal competition between online and physical operations.
“I am very vigilant about this issue. We must not make mistakes. We must ensure that it doesn’t harm certain stakeholders,” Minister Saint-Martin remarked, expressing sensitivity to the potential fallout from the proposed changes.
The association representing physical casinos, Casinos de France, shared these concerns. Grégory Rabuel, its president, warned about the severe challenges that online casinos could pose to traditional establishments. He cited potential declines in revenue ranging from 20% to 30% for physical casinos, along with predictions that up to 30% of these venues could face closure in the event of online casino legalization. Rabuel emphasized the social implications, noting that up to 15,000 jobs may be at risk within the industry, further compounding the challenges already facing land-based operators.
“Opening up online casinos will lead to catastrophic consequences, particularly in social terms,” Rabuel stated in a recent interview with Les Echos.
These collective industry fears are rooted not only in economic rationale but also in public health considerations. Féderation Addiction, a network of addiction specialists, has raised alarms over the risks associated with increased access to online gambling platforms. In 2019, they noted that approximately 1.4 million French citizens were already at risk of problematic gaming, describing the amendment as “irresponsible and contrary to public health priorities.” The group asserted that legalizing online casinos may lead to soaring cases of gambling addiction, detrimentally affecting vulnerable populations.
In contrast, the government has indicated that its hesitance stems partly from the need to reform the current unregulated online gambling landscape. Reportedly, illegal gambling generates between €748 million and €1.5 billion a year in France, creating a critical need for regulation to protect consumers and to counteract the underground market. The national gaming authority, l’Autorité nationale des jeux (ANJ), has highlighted that legalizing online gambling could allow for stricter regulations and oversight, thereby controlling a market that is currently largely unregulated.
Despite the withdrawal of the amendment, Minister Saint-Martin reassured stakeholders that the government maintains an open avenue to reassess online casino legislation in the future. France’s unique position as one of only two EU nations, along with Cyprus, to prohibit online casinos was acknowledged, prompting discussions on how to best align regulations with both European standards and national interests.
“We remain vigilant to ensure that the commitment made by the Budget Minister is upheld: any future legislative or regulatory changes should take place within a framework of consultation and constructive dialogue,” Rabuel stressed, reflecting Casinos de France’s readiness to collaborate with the government.
The current French gambling framework prohibits online casinos while allowing land-based casinos to thrive, a situation dating back to laws enacted in 2010. Those regulations have limited legalized online gambling to sports betting, horseracing, and poker. Consequently, the landscape remains fragmented, with discussions about the future regulatory environment becoming increasingly urgent.
The debate around online casino legislation is poised for further examination in the coming months, with continued emphasis on balancing state revenue aspirations with the safeguarding of the existing casino sector and public health priorities. In this regard, the government plans to host a public consultation session involving major industry stakeholders to explore the feasibility and implications of online gambling regulation.
The forthcoming public consultation is expected to delve deeper into the multifaceted impacts of regulating online casinos, including potential revenue generation, safeguarding employment in the land-based sector, and addressing addiction-related concerns. The anticipated conversations will pave the way for whatever legislative developments might follow, maintaining a commitment to inclusivity and dialogue between the government and industry representatives.
Looking ahead, the next major event on the legislative calendar is the formal vote in the National Assembly on November 19, 2024, concerning the 2025 budget, which may already undergo changes due to the withdrawal of the online casino amendment. Observers expect that the Senate will also scrutinize the proposal and advocate for measures protecting regions most affected by these initiatives, particularly coastal and thermal resort areas.
This ongoing legislative process, often described as the “parliamentary shuttle,” is expected to advance by December 21, 2024, marking a constitutional deadline for budget adoption. While the outcome remains uncertain, the initial discussions signal a critical turning point in France’s approach to online gambling regulation as pertinent societal concerns are holistically addressed.
This incident represents a noteworthy moment in France’s gambling regulatory landscape, marking the first time a government-led proposal has garnered widespread public debate. Although the fate of legalized online casinos remains uncertain, the multisided engagement showcases a government attuned to citizen concerns and economic realities. As stakeholders navigate this dynamic environment, they remain hopeful that constructive consultation will yield a balanced legislative approach moving forward.
As the French government embarks on this consultation journey, key issues will continue to evolve, shaping the future of online casino regulation in France. The dialogue’s outcomes may very well redefine the gambling framework in the country, striking a balance between innovation and the preservation of existing economic structures.