Euromat files complaint over Croatia gambling act changes

The European Gambling and Amusement Federation (Euromat) has formally submitted a complaint to the European Commission regarding Croatia’s recent amendments to its national Gambling Act. This move highlights significant concerns over procedural compliance, market access, and regulatory fairness in the Croatian gambling sector, raising potential implications for operators across Europe.

Amendments introduce far-reaching technical rules

Euromat emphasized that the changes introduced under the amended Gambling Act are extensive and go beyond standard regulatory updates. The Federation noted in its statement:

“The amended Gambling Act introduces far-reaching technical rules affecting access and provision of services on the Croatian gambling market, including mandatory player identification systems, strict limitations on the location and layout of gambling venues, a comprehensive ban on online and social-media advertising, temporal restrictions on operation and a central player self-exclusion register.”

According to Euromat, these measures not only affect how gambling services can be provided but also fundamentally alter the operational landscape for existing operators in Croatia. The amendments introduce structural and technical obligations that require immediate adaptation from operators, particularly those engaged in online and land-based gambling.

Uneven playing field for operators

Euromat also expressed concern that the law’s exemptions and regulatory privileges create an uneven competitive environment. The Federation stated:

“At the same time, by providing benefits from exemptions and regulatory privileges, the law creates an uneven playing field, to the detriment of certain segments of the gambling sector.”

These provisions may advantage certain operators over others, potentially disadvantaging companies that do not receive similar regulatory benefits. Euromat’s complaint indicates that such discrepancies could distort competition, a core principle of the European Union’s internal market framework.

Regulatory measures adopted without EU notification

As part of the Gambling Act’s adoption, Croatia introduced four separate implementing regulations. Each regulation contains technical rules developed “in further detail” of the new law’s requirements. However, Euromat noted that none of these measures were reported to the European Commission, as legally required under EU law.

Member States are obliged to notify the Commission of any draft legislation or regulations that could impact market access, the provision of services, or mandatory technical requirements. By failing to notify the Commission, Croatia may have breached EU procedural obligations, potentially undermining the principles of the Single Market.

Legal context and EU obligations

Euromat President Jason Frost highlighted the broader legal implications of the complaint:

“This complaint marks an important first step in the EU’s legal process. Complaints such as that filed by Euromat are a key tool to alert the Commission to potential breaches of EU law. Based on Euromat’s complaint, the European Commission will be able to assess the evidence and decide on the next steps, including whether to open infringement proceedings against Croatia.”

Frost further underscored the importance of maintaining legal certainty for businesses operating within the European Single Market:

“The notification procedure exists to ensure that national measures are compatible with the principles of the Single Market. Croatia’s decision to ignore this obligation not only breaches EU law; it also threatens legal certainty for businesses across Europe. The Commission must act decisively to uphold the integrity of the internal market.”

Repeated warnings ignored

Euromat’s complaint notes that repeated warnings were issued both to the Croatian Gaming Association (Hupis) and to the European Commission before Croatia enacted the amendments. Despite these alerts, the government reportedly proceeded with the Gambling Act amendments and subsequent regulations “without fulfilling its obligations.”

Hupis Secretary General Filip Jelavić expressed strong criticism of the Croatian Government’s approach:

“The Croatian Government has deliberately sidelined both stakeholders and EU institutions. By failing to notify, it has prevented scrutiny of measures that fundamentally distort competition and harm different segments of the gaming sector. We urge the Commission to carefully assess Euromat’s complaint and intervene without delay to ensure that the rule of law and fair market conditions are upheld.”

Broader implications for EU market integrity

Euromat raised concerns about the precedent set by Croatia’s actions. The Federation stated that such disregard for EU procedures generates “serious concerns” regarding the consistency and fairness of regulatory enforcement across the European Union:

“Such open disregard” for pre-established procedures generate “serious concerns” as to how other Member States may function if one entity is “blatantly and openly” ignoring the rules all others are expected to follow.”

This observation underscores the potential ripple effect on the wider European gambling industry. If one Member State is permitted to circumvent notification requirements, it may encourage other jurisdictions to adopt similar practices, threatening the harmonized regulatory framework established by EU law.

Key regulatory requirements under the Gambling Act

The Croatian Gambling Act introduces several measures that affect the gambling landscape:

Mandatory player identification

Operators must implement comprehensive systems to verify the identity of every player. This measure aims to strengthen consumer protection and prevent unauthorized access to gambling services but imposes significant operational requirements on service providers.

Location and layout restrictions

The law enforces strict limitations on the placement and design of gambling venues. These measures are intended to manage public accessibility and safety but may reduce business opportunities for operators unable to meet these new constraints.

Advertising restrictions

A comprehensive ban on online and social media advertising significantly restricts marketing channels. While intended to protect vulnerable populations, this restriction can substantially impact revenue and customer acquisition for online gambling platforms.

Temporal operating restrictions

Gambling venues are now subject to limitations on operating hours. While intended to encourage responsible gaming, these temporal restrictions may affect profitability and staffing for operators with established schedules.

Central player self-exclusion register

The establishment of a central self-exclusion register aims to protect players seeking to limit their gambling activity. This measure aligns with EU-wide responsible gambling initiatives but requires operators to integrate with national databases, creating additional technical obligations.

Potential next steps

Based on Euromat’s complaint, the European Commission is expected to review the evidence and assess whether Croatia’s amendments violate EU law. Potential actions may include:

• Opening infringement proceedings against Croatia
• Issuing formal recommendations to amend the legislation
• Monitoring compliance with Single Market principles
• Engaging in consultations with Croatian authorities and stakeholders

These steps ensure that national laws adhere to EU obligations and maintain a fair and competitive market environment.

Conclusion

Euromat’s formal complaint underscores the tension between national regulatory autonomy and EU procedural requirements. By bypassing notification obligations, Croatia’s amendments to the Gambling Act raise concerns over legal certainty, market fairness, and competitive integrity. The European Commission’s response will be crucial in reinforcing the principles of the Single Market and ensuring that all Member States follow consistent procedures.

Euromat’s proactive engagement demonstrates the critical role of industry associations in protecting market integrity and advocating for compliance with EU law. The situation in Croatia may also serve as a cautionary example for other Member States considering unilateral amendments that could disrupt the established regulatory framework.

FAQs

What is the main concern of Euromat regarding the Croatian Gambling Act?
Euromat is concerned that Croatia did not notify the European Commission about amendments that introduce technical rules affecting market access and operator obligations.

Which specific measures in the Gambling Act are considered problematic?
Measures include mandatory player identification, restrictions on gambling venue locations, advertising bans, temporal operating limits, and a central self-exclusion register.

Why must EU Member States notify the European Commission?
Notification ensures that national measures comply with EU Single Market principles and do not unfairly restrict competition or market access.

What could be the consequences for Croatia?
The European Commission may open infringement proceedings or issue recommendations to amend the law to comply with EU obligations.

What role did Hupis play in the complaint?
Hupis issued warnings and criticized Croatia for bypassing stakeholder consultation and EU notification procedures.

How does the law create an uneven playing field?
By granting exemptions and regulatory privileges to certain operators, the law disadvantages others and distorts market competition.

What are the potential impacts on operators?
Operators may face higher compliance costs, restricted marketing options, operational limitations, and integration with central player databases.

Why is legal certainty important for businesses?
Legal certainty ensures businesses can plan and operate predictably, reducing the risk of unexpected regulatory penalties or market disruption.

How does Euromat support EU compliance?
Euromat files complaints and engages with authorities to highlight potential breaches and advocate for fair, consistent regulatory practices.

What precedent does this situation set for other Member States?
It raises concerns that non-compliance with notification requirements could become a pattern, undermining the integrity and fairness of the EU Single Market.