Guideline on advertising gambling activities
By:
Teodora Luca
Senior Lawyer,
Nicoleta Bărăgan
Senior Lawyer,
Andreea Ciocanaru
Senior Lawyer,
Mihai Cătălin Luca Law Office
Continuation of the previous article
Guidelines targeting the gambling advertising
i) Advertising that is performed on the Company’s websites will not be acknowledged as gambling advertisement, as per article 1*2 from Government Emergency Ordinance no. 77/2009.
On each promotional material displayed outside its own location or website, the Company must inscribe the number of its gambling performance licence, interdiction of minors to participate to gambling activities and the Gambling Authority (National Gambling Office) logo.
ii) Bonuses offered by the on-line licensed companies may be promoted only on the webpage of the licensed gambling company or the affiliate’s webpage or by sending electronic messages to the players with active accounts from the company’s own data base, only if said players have previously expressed the approval regarding the reception thereof.
The legislation applicable in the field of gambling grants to (both traditional and remote) gambling organizers, by art. 7 para. (3) of the Methodological Norms for the application of GEO no. 77/2009 on the organization and operation of gambling, the possibility to award, from their own funds, bonuses to the players, in any form, but only under the conditions and limits regulated under specific Terms and Conditions to be approved in advance by the Supervisory Committee of the National Gambling Office (NGO or ONJN).
Bonuses are defined as per art. 2 let. f) of the Methodological Norms as: “the additional benefit that may be obtained by the player, without being charged with additional fees or costs, under the conditions provided in the organizer’s terms and conditions, in a determined period or for certain events”.
To this end, any bonus must cumulatively meet the following conditions:
– To represent for the player a benefit additional to its own real money funds;
– No additional participation fees or costs to be charged from the player;
– To be provided in accordance with the gambling organizer’s specific terms and conditions approved in advance by the NGO;
– To refer to a determined period or to certain events.
As per art. 7 para. (4) of the Methodological Norms, in the case of bonuses granted by the remote gambling organizers for the purpose of being used for participation to gambling, such must be transferred only to the player’s game account, their withdrawal not being allowed. Such bonuses must be recorded separately from the player’s other funds available for withdrawal at any time.
At the same time, by para. (5) of the same article it is regulated that the bonuses granted must be separately recorded in the accounting of the gambling organizer. Such shall be recorded as revenues of the gambling organizers when used by the player and shall be thus assimilated to the player’s participation fee. Bonuses that are not used for participation to gambling shall be separately recorded according to their destination or may be withdrawn (cancelled) by the gambling organizers in accordance with the provisions of the terms and conditions or the regulation based on which the bonuses are granted.
In line with the above, a gambling organizer is obliged per law:
i) Not to provide credit (funds) to a player’s payment account or game account and not to allow free participation to games of chance in other conditions than the ones set out in the applicable legislation for granting bonuses to participants to gambling;
ii) Not to credit (fund) the participants to gambling and to ensure the distribution of bonuses to the players in accordance with the approved terms and conditions;
iii) To comply with its regulations approved by the Supervisory Committee of NGO, as well as the provisions regarding the offering, transfer and recording of bonuses.
Regarding the approval by the Supervisory Committee of the NGO of the specific Terms and Conditions which are to regulate the granting by the gambling organizer of bonuses, we mention the following:
a) The Supervisory Committee’s meetings are held twice a month, as ordinary meetings; in addition to the two ordinary meetings, an extraordinary meeting may also be held (at the discretion of the NGO) at the same date with the second ordinary meeting of the month;
b) For ordinary meetings, complete documentation afferent to the application must be submitted at least 9 business days before the relevant meeting date, whilst for the extraordinary meeting (if held), there is the possibility to be included on the agenda and to be analyzed the applications submitted without the observance of the 9 business days’ term.
The affiliates are allowed to advertise the gambling activity in the same manner as the company holding the license to operate gambling activities.
Hence, bonuses offered to the customers could be advertised only by the company holding a license to operate gambling or by its affiliates.
In order to advertise the gambling activities, the affiliates must hold a Class II license issued by the Gambling Authority and the relationship between the affiliate and the gambling company must be notified to the Authority (within 5 business days since the affiliation agreement is concluded).
Failure of the company to observe the restriction to promote the bonuses, would entitle the authority to apply the fine worth of 10.000- 25.000 Lei and to apply a complementary sanction, consisting of suspension of the authorisation for a period up to 6 months.
iii) Promotional campaign may be subject of National Gambling Office endorsement, if it meets the conditions to be considered itself a gambling activity
On one hand, as a rule, promotional actions are organized and carried out by gambling organizers as per the conditions of art. 11 paragraph (1) lit. c) from GEO no. 77/2009, according to which “The following types of games are not considered games of chance and are allowed without authorization: (…) c) actions organized by different economic operators, in accordance with the law, with the purpose of stimulating sales and which do not involve a participation fee, respectively no additional expenses on the part of the participants and no increase in the price that the product had before the promotional action was carried out”.
On the other hand, in specific cases it is regulated by law that a special endorsement from the NGO is necessary for the performance of a promotional campaign. To this end, according to art. 3 para. (3) of GEO no. 77/2009, “The performance of activities aimed to promote the marketed goods and services by economic operators is forbidden if the name of the promotional activity induces to clients the idea of participation to gambling or if the actual way such is carried out is contrary to the provisions of this emergency ordinance. In cases in which the promotional activity of an economic operator cumulatively meets the elements defining gambling, as laid out in art. 3 para. (1), the obligation to receive O.N.J.N endorsement shall be incident, with the exception of trade promotion lotteries organized on the basis of GEO 99/2000 on the marketing of products and market services, republished, subsequently amended and supplemented”.
It is further regulated by art. 6 para. (5) of the Methodological Norms, that “Activities aimed to promote the marketed goods and services, carried out by any gambling organizer, consisting of awarding winnings, monetary or of any kind, organized outside of their own facilities or outside of their own websites, which involve the use of gambling-specific means of awarding prizes, as provided for in Article 3 para. (3) of GEO 77/2009 are subject to ONJN endorsement.”
The elements defining gambling, laid down in Article 3 para. (1) of GEO 77/2009, are the following: “material winnings, usually money, are awarded as a result of the organizer publicly offering potential winnings and the participant accepting the offer, with the charging of a direct or dissimulated participation fee, the winnings being awarded in accordance with the gambling regulation approved by the National Gambling Office, hereinafter named O.N.J.N., through the random selection of the results of the events that are the object of the game, no matter the way they are produced”.
As it results from the above, art. 3 para. (3) of GEO 77/2009 served the purpose of regulating the obligation to receive prior endorsement for the promotional activities carried out by economic operators in general (without distinction between economic operator categories). In order for the previously outlined obligation to become incident, the promotional activity needs to cumulatively meet the elements defining gambling, as laid out in para. (1) of art. 3 of the same legislative act.
(to be continued in the next issue)
