Poland's Naczelny Sad Administracyjny (NSA), the country's Supreme Administrative Court, has published its judgment on potential incompatibilities between the Polish Gambling Act and European Union law. This judgment had been eagerly anticipated by foreign operators who were hoping for a change to the law governing the register of web domains used to offer gambling services.
In Judgments made in May 2022 (case file: II GSK 1828/1 and June 2022 (case file: II GSK 1974/18) the NSA laid out its interpretation of the provisions of the Treaty on the Functioning of the European Union (TFEU) and, inter alia, Article 56, Article 267 TFEU and Article 15f(4) and (6) to (10) of the Polish Act of 19 November 2009 on gambling games (i.e. Journal of Laws of 2022, item 888, as amended (The Act). It ruled that the Polish Act was compliant with the provisions of the TFEU.
What did the cases in question involve?
- The decision by the NSA related to an amendment to the Act which came into force on 1 April 2017. This amendment introduced a state monopoly on gaming on slot machines outside casinos (Article 5(1) of the Act), and on the organisation of gambling games over the Internet, with the exception of betting and promotional lotteries (Article 5(1b) of the Act). As of 1 April 2017, an official register of internet domains offering gambling illegally was introduced. Later, on 1 July 2017, telecommunications companies were obliged to block such websites and payment service providers were obliged to prevent payments being made via websites listed in the Register (Articles 15f and 15g of the Act).
- The amendment resulted in domains belonging to foreign operators being entered in the Registry despite the fact that they were operating across Europe on the basis of licenses issued in other European countries, including Malta.
- Decisions on the entry of domains in the Registry were objected to, then appealed to the voivodship administrative courts and finally to the NSA. One of the arguments advanced by the plaintiffs was that the law on which the authority relies to make the entry in the Registry is incompatible with the regulations in force in the EU.
- In these cases, the plaintiffs applied to the Court of Justice of the European Union (CJEU) for a preliminary ruling as to the compatibility of the Polish Act with the provisions of the TFEU.
The NSA's judgements
- The NSA dismissed the allegation that the process for including a domain in the Registry prevented the party concerned from participating thus depriving it of the right to be heard and to present its arguments, and depriving it of access to the rationale and justification for including and maintaining a domain in the Registry.
- The NSA held that the provisions of the Act governing entry in the Register meet the standards of good administration established in the Charter of Fundamental Rights of the European Union.
- In the NSA's view, the regulation contained in Article 15 f of the Act is not discriminatory and does not conflict with the Treaty principle of freedom to provide services, including the principles of proportionality, consistency and effectiveness. It concluded that freedom of economic activity in the field of gambling may be subject to more far-reaching restrictions justified by the important public interest referred to in Article 22 of the Polish Constitution.
- The NSA also concluded that the cases under consideration did not meet the standard required to initiate a request for a ruling to the CJEU as, in the Court's view, a decision on this issue is not necessary for the judgment in the case pending before it.
- The NSA decided that the legal solutions adopted by Poland do not diverge from - or even correspond to - the approach accepted in Luxembourg case law regarding the establishment of an exclusivity (monopoly) principle to grant exclusive rights to operate gambling over the Internet to a single entity that is subject to strict control by the public authorities.
In summary, as ruled by the NSA, the Polish state monopoly on certain gambling games introduced in the 2017 by amendment to the Act and the mechanism for entry into the Register of Prohibited Domains is in line with European Union law and CJEU case law.
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