Andreea Ciocanaru C.A Luca Mihai Catalin

Case study: Recommendation bonuses granted by online platforms

By Andreea Ciocănaru,
Lawyer with Luca Mihai Cătălin Law Office

By a recent court decision, the Bucharest Court of Appeal ordered the annulment of a decision of the Supervisory Committee of the National Gambling Office (ONJN), a decision ordering the rejection of the application to amend the terms and conditions for granting bonuses, the court at the same time ordering the ONJN to approve the requested amendment.

Specifically, a request to amend the terms and conditions of the bonuses was submitted to the ONJN Supervisory Committee for approval, with the aim of regulating the recommendation bonus, the patron of which is, in essence, the following:
– The online gambling organizer sends a registration link, created especially for this purpose, to customers in its own database – players who have an active game account registered on the game platform;
– This link could only be sent to those players who have expressly expressed themselves and prior consent to receive promotional materials;
– In order to benefit from the bonus offer, users who received the registration link had the opportunity to distribute the link to other individuals who do not have a game account on platform;
– Through the link, people who received this link had the opportunity to register a game account through it;
– For the referral activity performed by sending the link, the gambling organizer was to grant a bonus to both persons, respectively to the user who sent the registration link, as well as to the person who received the registration link, in the moment when the latter would have completed the game account registration procedure.

ONJN rejected the request to amend the terms and conditions for granting bonuses, the decision being reasoned as follows:
(i) this new type of bonus does not comply with the provisions of art. 6 para. (3) of the Methodological Norms, which provide the following:
The promotion of bonuses to participants is permitted only in their own locations or on their own or affiliates’ websites, as well as by sending e-mails to players with active accounts in their own database, if they have expressed in prior agreement for their receipt.
In this regard, the argument was mainly focused on the fact that the granting of this bonus involves a promotional activity, performed on individuals who do not have the status of player with an active account in the organizer’s database and who did not give agreement to receive e-mails promoting the bonus action.
(ii) this way of granting bonuses is one of a financial nature in a pyramid system (prohibited commercial practice), the defense being based on the provisions of art. 36 of GO 99/2000 on the marketing of market products and services.
(iii) reasons for the protection of minors or other vulnerable persons, arguing that this bonus is likely to create a social danger to such persons, in particular by gambling addiction, as it is not possible to control which persons I receive the registration link.

As it was also argued before the court, the text of the law invoked by ONJN, respectively art. 6 para. (3) of the Methodological Rules, regulates three permitted, distinct ways of promoting bonus actions, namely (i) in the organizer’s own locations or on its own web pages, (ii) on the own web pages of the organizer’s affiliates and (iii) by the organizer sending e-mails to players with active accounts in their own database, if they have previously agreed to receive them. The method of granting the bonus submitted for approval to the Supervisory Committee is subject to and follows exactly the third method permitted by law, detailed in point iii) above, for the promotion of bonus actions.
The promotion of the bonus is done by the organizer by sending messages only to customers in its database, who have previously given their consent to receive promotional messages. Contrary to what the ONJN claims, the gambling organizer does not in any case address people who are not registered on its gaming platform. The customers of the gambling organizer are the ones who address people outside the platform and only these customers decide whether or not to send the registration link to people who do not have a game account.
The arguments of the authority, which assimilated the action of promoting the activity of online gambling by granting the bonuses of a “pyramid sale”, are incomprehensible.
Only people who are registered on the gaming platform are eligible to receive a bonus. The registration of the gambling account involves a strict procedure regarding the knowledge of the client, a procedure justified, on the one hand, by considerations for the protection of minors and other vulnerable persons, and on the other hand, by money laundering legislation.

Ciocanaru Andreea

Among the arguments retained by the court, the following seem to have a special significance, completely changing the conclusions of the National Office for Gambling;
– Sending a promotional link via e-mail to players with active accounts from their own database falls within the provisions of art. 6 para. (3) of the Methodological Norms;
“The text of the rules does not further regulate a ban on players with active accounts to forward this link, stimulated by the appearance of a bonus, having the freedom of private correspondence”;
– The ultimate goal of the gambling organizer, namely to increase its database with active users by using the link, is not prohibited by law, as in any type of business, it is perfectly normal for the organizer to pursue growth. gaming platform and consequently profit.
– ONJN’s interpretation regarding the application of art. 6 para. (3) of the Methodological Rules is an “extremely restrictive” one and moreover, the arguments for rejecting the bonus based on social danger consisting, in particular, in gambling addiction, appear to be contrary to the mission of ONJN, which it is not to stop gambling activity, but to exploit gambling activity, especially given that it has a budget consisting of addiction fees;
The provisions of Government Ordinance 99/2000 on the marketing of market products and services do not apply to games of chance, which have their own special regulations, including from the perspective of the fact that art. 36 of this normative act ”refers to synallagmatic contracts with mutual benefits (goods / services for a price) that do not have a random element, of chance, as gambling seems to have, and the latter are in addition under a state monopoly”.

The decision of the court adds value by the fact that, in addition to re-establishing the legal regime applicable to gambling bonuses, it establishes a new perspective on the role of ONJN, which, as a monitoring and control body in the field of gambling. In order to facilitate the operation of games of chance in accordance with the legal provisions and not to stop this activity, as long as the law does not expressly prohibit a certain conduct.

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