anchidim zagrean

The practice of gambling in 2021

Quality in special gambling regulations

Article from the series „Gambling practice”, by Anchidim Zagrean, vice-president ROMBET

In the new conditions of political stability and reanalysis of state public policies, I believe that one of Parliament’s priorities should be to apply the constitutional principle of the quality of laws – with an emphasis on accuracy, predictability, clarity and ease of understanding the purpose to be achieved. their application. In this regard, I believe that all regulations, adopted and entered into force, but with a high dose of confusion and ambiguity, should be reviewed, especially in terms of compliance and compliance and their implementation. Among these regulations, which I believe must be subjected to an extensive review process, must be found the package of special legislative norms, adopted in the field of gambling in Romania.
In a summary, without looking exhaustively on the entire regulatory package, the analysis and then the decision to amend and supplement the legal norms, in the field of gambling in Romania, should include in particular:

1. The principles and definitions on the basis of which the new legal norm must be developed
The principles that must underpin the entire regulatory package on gambling must be based in particular on the general conclusions drawn up by the Court of Justice of the European Union (CJEU), which on numerous occasions, when ruling on the exemption of gambling from the Services Directive has established that the restrictions imposed on gambling activity are justified by overriding reasons in the public interest, such as the protection of consumers and minors or the general need to maintain law and order. Member States’ general gambling policy must be proportionate, applied in a consistent and systematic manner and the restrictions must also be compatible with EU secondary legislation.
We note, as did the CJEU, that the level of tax revenue is not one of the reasons for the restriction and is not an overriding reason in the public interest.
We also find in the jurisprudence of the CJEU that restrictions must be applied without discrimination and that they must be proportionate or appropriate to the achievement of the objective pursued and not go beyond what is necessary to achieve it. In this respect, the licensing procedure must respect the principles of equal treatment and non-discrimination, as well as the resulting obligation of transparency.
The definitions to be used in the new regulation should be based on the notions enshrined in official EU documents, when they make clear reference to the field of gambling, with special reference to:
a) Definition: The organization and operation of gambling is an services activity in the field of entertainment, which means any service that involves monetary stakes in gambling, including those involving an aptitude, such as lotteries, gambling casino, poker games or betting transactions which are provided by any means or technology to facilitate communication and only at the individual request of a recipient of the Services;
b) Definition: The amounts paid by players to participate in games of chance contain two elements: payment for a service provided by the organizer of the game of chance and a transfer of stakes to the winners;
c) Definition: Transfers made by the organizer, as part of the stakes won, are considered to be made directly between the participants in the games of chance;
d) Definition: According to settled case law of the CJEU – the income of the gambling organizer is represented by the consideration actually received and which he can actually dispose of for himself. This economic operation must be interpreted as meaning that the tax base of those services consists of the consideration actually received for that benefit and the part to be redistributed to the players in the form of winnings must not be included in the tax base and, therefore, it cannot be considered as part of the game organizer’s turnover.

2. Granting the right to organize and exploit gambling
We know that in Romania the gambling activity constitutes a state monopoly, which means that the state has the right to establish the regime of access of economic agents, with state or private capital, to this economic activity, as well as the conditions for exercising it. Therefore, the new special regulation should clearly provide for the concrete and non-discriminatory way of access of economic operators to the state gambling monopoly, by granting the license concession and the conditions under which this activity is exercised, based on the authorization exploitation of this activity. And, in this decision on how to grant the right of access and the conditions imposed for its exercise, the official documents of the EU bodies on compliance with the following desideratum must be taken into account: 1. compliance of national regulatory rules with EU law; 2. stepping up administrative cooperation and effective enforcement of measures; 3. protection of consumers and citizens, minors and vulnerable groups; 4. prevention of fraud and money laundering; 5. guaranteeing integrity in sport and preventing arranged matches.
Licensing for the operation of the state monopoly, as well as the establishment of the conditions for its exercise, the monitoring and control of compliance with these conditions, must be carried out by the competent regulatory authority, which cooperates with the authorities of other Member States and uses all effective means available for implementation. In order to ensure effectiveness in the implementation and monitoring of compliance, in the field of gambling, as well as effective cross-border administrative cooperation, the state must have a well-equipped regulatory authority. The national regulatory authority must have adequate know-how and skills to meet the regulatory challenges in a rapidly growing and highly technology-dependent market.

3. Gambling-specific fees and taxes
From the above presentation, according to which the fees and taxes of gambling activities do not fall into the category of restrictions that may be imposed in carrying out this activity, as established by the CJEU – on the grounds that it is not a compelling reason of general interest – it is clear that the new regulations must take account of the principles of taxation, as follows:
a) the neutrality of the fiscal measures in relation to the different categories of investors and capitals, with the form of property, ensuring by the level of imposition equal conditions to the investors, the Romanian and foreign capital;
b) the certainty of taxation, by elaborating clear legal norms, which do not lead to arbitrary interpretations, and the terms, method and amounts of payment to be precisely established for each payer, respectively to be able to follow and understand the tax burden may determine the influence of their financial management decisions on their tax burden;
c) the fairness of the taxation or the fiscal equity ensures that the fiscal burden of each taxpayer is established on the basis of the contributory power, respectively according to the size of his income or properties;
d) the efficiency of taxation ensures similar levels of budget revenues from one budget year to another by maintaining the efficiency of taxes, fees and contributions in all phases of the economic cycle, both in times of economic boom and in times of crisis;
e) the predictability of taxation ensures the stability of taxes, fees and compulsory contributions, for a period of at least one year, during which no changes can occur in the sense of increasing or introducing new taxes, fees and compulsory contributions.
European regulations also clearly stipulate that gambling fees, both those due to the granting of the monopoly and those due as a result of the operation of this activity, are defined as fees or taxes on services provided to players, therefore the level they must be determined according to the level of service provided or according to the volume of activity carried out. Therefore, license fees or authorization fees can be set, either in a fixed amount or as a percentage of the income earned, but in both cases their level must be directly correlated with the level of service performed or the volume of activity performed. A practical formula could be set as follows: a minimum level of license and authorization fees, which are due and paid in advance, before the date of issue of the documents, both documents (license and authorization) having the same validity period (ten years), and subsequently these fees, paid in advance, are offset by the fees due, depending on the level or volume of activity, which will be declared and paid monthly, from the moment of exceeding the level of taxes calculated compared to the level of taxes paid in advance.

4. Restrictive operating conditions for gambling
The restrictive conditions imposed on the organization and operation of gambling must relate exclusively to: 1. the protection of consumers in the field of gambling services; 2. protection of minors; 3. responsible commercial communication of gambling services; 4. public interest objectives, which the State seeks to protect, but in this case must demonstrate that the measure in question is appropriate and necessary, having the duty to demonstrate that the public interest objectives are consistently and systematically pursued; 5. prevention of gambling addiction.

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5. Administrative sanctions and the right to defense
Clearly establishing the conditions under which a gambling organizer may lose the right to organize this activity and the way in which the right to exploit, totally or partially, this activity may be lost, as a consequence of complementary sanctions to the legal regime of contraventions.
The precise and clear establishment of the rights and freedoms of gambling organizers, in all that means: 1. the right of every person to be heard before taking any individual action which might harm him or her; 2. the right of any person to access his / her own file, respecting the legitimate interests related to confidentiality and professional and commercial secrecy; 3. the obligation of the administration to motivate its decisions; 4. the right to an effective remedy before a court or tribunal; 5. the right to a fair, public and reasonable trial before an independent and impartial tribunal, established in advance by law; 6. the fact that any accused person is presumed innocent until proven guilty in accordance with the law.

6. Correlation of special norms with general norms
The need to correlate the new provisions, with other national or Community legal provisions, with special reference only to: 1. Regulation of electronic cash registers – the need for exemption from this obligation for gambling organizers – due to the fact that in gambling activity gambling is collected from gamblers rather than income and the fact that the gambling activity is constantly supervised, monitored and controlled by the special body set up for this purpose; 2. Regulation of the state monopoly, with unitary applicability, both for private and state capital.
Opinions on this subject are based on: documents prepared by the EU institutions; the provisions of the Constitution; Decisions of the Constitutional Court; National rules on legislative technique, with express reference to:
1. The Romanian Constitution – “In Romania, observance of the Constitution, its supremacy and the laws is mandatory.”
“As a result of accession, the provisions of the Constitutive Treaties of the European Union, as well as the other binding Community regulations, have priority over the contrary provisions of domestic law, in compliance with the provisions of the Act of Accession”;

2. The norms of legislative technique – “Normative acts must be drafted in a specific normative language and legal style, concise, sober, clear and precise, which excludes any ambiguity; The draft normative act must establish the necessary, sufficient and possible rules that will lead to the greatest possible stability and legislative efficiency. The solutions it contains must be thoroughly substantiated, taking into account the social interest, the legislative policy of the Romanian state and the requirements of correlation with all internal regulations and harmonization of national legislation with Community law and international treaties to which Romania is a party. and with the case law of the European Court of Human Rights.”

We return with other opinions, in the next issue of the magazine…

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