Announced in September, the review focused on the Remote Gambling Act and its first three years since coming into law. The legal Dutch online gambling market launched in October of 2021, with the Act regulating the sector.
Dutch law states that the Act must be reviewed within three years of coming into force. The government has now published the results of this review, picking out several concerns with current regulations.
The general conclusion of the review was somewhat damning. It concluded the Remote Gambling Act had simply not yet created a sustainable and safe market in line with the legislation’s original policy aims.
Recent changes, such as tighter advertising regulations, could not be assessed as these were implemented too late in the process.
“Naïve” to place care responsibilities in hands of operators
The standout concerns highlighted in the review relate to responsible gambling. According to the review, current measures are not up to scratch and need improving to better serve the market.
“We conclude the Act has not yet contributed to such a responsible and verifiable gambling offer that it can be said that the policy objectives of the online gambling policy will be achieved in the short or long term,” the review said. “The policy has also led to a large group of new players, including many young adults.
“Based on the policy and current implementation practice, it can be expected, especially in this group, damage will occur because of the policy. This does not only concern financial harm, but potentially also great personal suffering as a result.”
Specific points include underutilisation of addiction prevention representatives, as set out in the Act, with this seen as a failure. The review also said information on preventing addiction is not properly communicated to players and “insufficient”.
Deposit and spending limits under fire
The review also blasted spending limits, saying the way these are used “cannot be seen as a protective measure”. In addition, it criticised actions around duty of care, saying operators are not the right party to oversee this due to their own commercial interests.
“Placing the care for online gambling players in the hands of parties that offer an addictive product and have to compete with each other for market share, which gives them a financial incentive to retain players for as long as possible, has been naïve,” the review said.
“These open standards have led to major differences between providers. In a licensing system with multiple licence-holders, providers must compete for market share. This creates a financial incentive not to strictly implement duty of care; licence-holders with strict interventions could lose players to competitors.”
Some success with consumer protection
Certain addiction prevention measures were seen as partially successful. These include the Addiction Prevention Fund (VPF) and national self-exclusion scheme Cruks. However, these both require improvements as they are seen as only “partially sufficient”.
The same, the report said, applied to operators needing to ensure customers have access to a reliable playing environment. While there were no signals environments are not safe, there are possibilities for improvements.
In addition, the report said personal data protection measures have been performing well and were rated as “good”.
However, within the consumer protection segment, concerns have been raised in regard to advertising. The review said that this may encourage excessive gambling and unintentionally reach vulnerable groups. This is despite a ban on most gambling advertising across various media channels coming into effect last year.
“The current implementation of measures with regard to recruitment and advertising also do not contribute sufficiently to protecting the consumer,” the review said. The report noted the impact of the new controls, including a ban on ‘untargeted’ advertising, were yet to be seen.
Match-fixing still a concern for Dutch authorities
In terms of combatting fraud and crime, on the whole, the review looked kindly on this area. It said player identification measures are performing well, as are anti-money laundering and integrity management systems.
However, it did flag issues related to match-fixing, saying current measures are failing. This, it said, is due to a lack of information sharing with authorities and sports associations. The review, however, did say the problem is only minor and match-fixing is not commonplace.
“In the area of match-fixing it is also difficult to determine whether the intended effects are achieved, because it is not clear how big the problem of match-fixing is related to online gambling,” it said.
“However, various parties involved indicate that, despite the strong focus of the Act on match-fixing, this problem is not very big. Sports-related crime is an important issue, but match-fixing specifically is not always seen as a big problem.”
Better enforcement of legal market can help channelisation
In its conclusions, the review also made reference to channelisation. Last month, regulator Kansspelautoriteit (KSA) stated the current online gambling channelisation is at 95%. However, consumer spend and revenue data suggests the rate is more likely 87%, with players spending more on illegal sites.
This led to calls from the Netherlands Online Gambling Association (NOGA) and Licensed Dutch Online Gambling Providers (VNLOK) for greater monitoring of the black market. The review agrees, saying better enforcement of the illegal sector can drive channelisation in the longer term.
“Enforcement of the illegal market is not yet proceeding as desired,” the review said. “This is primarily because the enforcement instruments the KSA has at its disposal do not sufficiently match the characteristics and approach of the illegal providers.
“These parties are actually never established in the Netherlands, but in complex jurisdictions where they technically shield themselves and the KSA can exert little or no pressure.
“Better enforcement of the illegal market, which is therefore less easy to find and less attractive, can create space to also regulate the licensed offering more strictly without a decrease in attractiveness leading to de-channelisation.”
What happens next?
The review noted that beyond a rise in gaming taxes, regulatory reform is not currently seen as a priority for the Netherlands coalition government. As such researchers recommend a single update of the law, rather than piecemeal changes, would be more effective.
Going forward, Secretary of State for Legal Protection Teun Struycken has pledged to assess whether further changes to enhance licensees’ duty of care should be implemented, via policy changes or ministerial regulations rater than a change in law.
This may resurrect talk of a ban on online slots. The review noted Struycken was looking at prohibiting “very risky elements” in the legal product range, “particularly online gaming machines” within the current legal framework.
Original article: https://igamingbusiness.com/legal-compliance/dutch-regulation-review-responsible-gambling-failures/
