Three years since the legalisation of online gaming

1 October 2024 marks three years since the entry into force of the Remote Betting and Gaming Act (Wet kansspelen op afstand (in Dutch), hereinafter: the Act). The Act allows licensed providers to offer online games of chance to consumers. The opening-up of the online gaming market has led to a major increase in providers, users and sales. For example, gross gaming revenue (GGR) – i.e. the total value of stakes minus the winnings paid out – rose 28% between 2022 and 2023, up from EUR 1.08 billion to EUR 1.39 billion. The Kansspelautoriteit (the Ksa) is the Dutch gaming authority tasked with monitoring compliance with the Act. The nation's politicians also keep a close watch on the online gaming market. In this news update, we discuss the latest developments.

Online gaming market keeps on growing

More and more consumers are engaging in this inherently risky hobby. Since its legalisation in 2021, the legal online gaming market in the Netherlands has greatly expanded (in Dutch):

• The number of licences issued to providers went up from 10 in October 2021 to 27 in December 2023;
• The percentage of players gaming with a legal provider has gone up from 40% to 90% since the legalisation of online gaming;
• In addition, the number of active player accounts increased from 970,000 to 1.1 million in the space of a year (December 2022 to December 2023).
  
  

Intensive Ksa supervision

According to the Ksa, the figures show that online gaming providers are still not sufficiently effective in identifying and protecting against problematic gaming behaviour among consumers. This has prompted strict enforcement, with 63 sanction decisions in total. The most notable ones are the following:

• In February 2024, the Ksa imposed its highest individual penalty ever (website in Dutch), ordering Gammix Limited to pay nearly EUR 20 million for operating in the Dutch market without a licence and without implementing an age check;
• BetCity received a EUR 3 million penalty (in Dutch) for its inadequate screening of clients and transactions to prevent money laundering and terrorist financing;
• Five parties were fined (in Dutch) over EUR 26 million in total for offering online games of chance in the Netherlands without a licence. The penalties were high because of aggravating circumstances.
  
  

Political developments

Politicians' calls for further regulation of the online gaming market are getting louder. On 16 April 2024, the Dutch House of Representatives passed motions for a total ban on online advertising for online games of chance, including those demonstrably involving extremely high risks (particularly online slot machines). However, there seems to be no consensus between the current coalition partners PVV, VVD, NSC and BBB to actually implement these motions. A total ban on online gaming is certainly not on the horizon, in our view. Only NSC proposed in its election programme to ban gaming ads and online gaming. The coalition agreement is silent on online gaming (or its reversal). PVV, VVD and BBB have warned that a ban on online gaming would reinstate the situation as it was before 1 October 2021, when the number of illegal providers in the market was considerable. However, these parties do call for stricter regulation to counter excesses.

Recent and upcoming regulations

We have observed the following recent and upcoming regulatory developments:

• Tightening of advertising rules: since 1 July 2023, 'untargeted advertising' – advertising on the radio or television or in newspapers, magazines and outdoor spaces – has been banned. The sponsoring of events has been banned since 1 July 2024 and all sponsoring will be prohibited from 1 July 2025. Online advertising is only possible if its reach is almost exclusively limited to persons aged 24 and above;
• Responsible gaming: on 1 October 2024, the Gaming Limits and More Conscious Gaming Behaviour Regulations (Regeling speellimieten en bewuster speelgedrag, in Dutch) will take effect, introducing additional rules for online gaming providers. Providers will be required to inform players more specifically of the risks of their gaming behaviour and the extent of their limits. In addition, the Responsible Gaming Policy Rules 2024 (Beleidsregel verantwoord spelen 2024, in Dutch) will enter into force on the same date. These rules will require online gaming providers to check with players whether they are able to bear the financial consequences if they deposit more than EUR 700 per month in a gaming account, or EUR 300 for young adults until the age of 24.
  
  

Outlook

Given PVV's, VVD's, NSC's and BBB's election programmes and the coalition agreement, we do not currently expect that a total ban on online gaming will be introduced. For that reason, a total ban on online slot machines does not seem likely in our view. Still, this market will remain subject to close scrutiny and we anticipate increasingly strict market regulation to protect players – such as the advertising ban and upcoming measures to ensure more conscious gaming behaviour.