Joined Cases C‑186/11 and C‑209/11

Stanleybet International Ltd (C‑186/11),

William Hill Organization Ltd (C‑186/11),

William Hill plc (C‑186/11),

Sportingbet plc (C‑209/11)

v

Ipourgos Oikonomias kai Oikonomikon,

Ipourgos Politismou

(Requests for a preliminary ruling from the Simvoulio tis Epikratias)

(Articles 43 and 49 EC — National legislation granting an exclusive right for the running, management, organisation and operation of games of chance to a single undertaking, in the form of a public limited company listed on the stock exchange — Advertising of the games and expansion in other Member States of the European Union — State controls)

Summary — Judgment of the Court (Fourth Chamber), 24 January 2013

1.        Freedom of establishment — Freedom to provide services — Restrictions — Games of chance — National legislation granting an exclusive right for the running, management, organisation and operation of games of chance to a single undertaking under State control — Not permissible — Justification — Overriding reasons in the public interest — Objective of restricting the availability of games of chance and combatting criminality — Duty to meet the requirements of proportionality and non-discrimination — Determination by the national court

(Arts 43 EC and 49 EC)

2.        Freedom of establishment — Freedom to provide services — Restrictions — Games of chance — National legislation granting an exclusive right for the running, management, organisation and operation of games of chance to a single undertaking under State control — Not permissible — Possible for the national administration to refrain, on a transitional basis, from considering applications for permits in the sector of games of chance — No such possibility

(Arts 43 EC and 49 EC)

3.        Freedom of establishment — Freedom to provide services — Restrictions — Games of chance — National legislation granting an exclusive right for the running, management, organisation and operation of games of chance to a single undertaking under State control — Not permissible — Refusal to grant a transitional period to the national administration concerned in order not to consider, on a transitional basis, applications for permits in that sector — Conditions for the grant of permits for the organisation of games of chance in light of such applications — Compliance with the fundamental rules of the Treaties and the principles of equal treatment and openness

(Arts 43 EC and 49 EC)

1.        Articles 43 EC and 49 EC must be interpreted as precluding national legislation which grants the exclusive right to run, manage, organise and operate games of chance to a single entity, where, firstly, that legislation does not genuinely meet the concern to reduce opportunities for gambling and to limit activities in that domain in a consistent and systematic manner and, secondly, where strict control by the public authorities of the expansion of the sector of games of chance, solely in so far as is necessary to combat criminality linked to those games, is not ensured. It is for the national court to ascertain whether this is the case.

(see para. 36, operative part 1)

2.        In the event that the national legislation governing the organisation of games of chance is incompatible with the Treaty provisions on the freedom to provide services and the freedom of establishment, the national authorities may not refrain from considering applications, such as those at issue in the main proceedings, for permission to operate in the sector of games of chance, during a transitional period.

(see paras 38, 39, operative part 2)

3.        The refusal to allow the national administration concerned a transitional period in which it does not have to consider, on a transitional basis, applications for the grant of permits in the sector of games of chance in the event of incompatibility of national legislation with Articles 43 EC and 49 EC does not necessarily lead to an obligation for the Member State concerned to liberalise the market in games of chance if it finds that such a liberalisation is incompatible with the level of consumer protection and the preservation of order in society which that Member State intends to uphold. Under EU law as it currently stands, Member States remain free to undertake reforms of existing monopolies in order to make them compatible with Treaty provisions, inter alia by making them subject to effective and strict controls by the public authorities.

In any event, if the Member State concerned should find that a reform of an existing monopoly effected with a view to making it compatible with Treaty provisions is not feasible and that a liberalisation of the market in games of chance is the better measure for ensuring the level of consumer protection and the preservation of order in society which that Member State intends to uphold, it will be required to observe the fundamental rules of the Treaties, including in particular Articles 43 EC and 49 EC, the principles of equal treatment and of non-discrimination on grounds of nationality and the consequent obligation of transparency. In such a case, the introduction in that Member State of an administrative permit scheme for the provision of certain types of games of chance must be based on objective, non-discriminatory criteria which are known in advance, in such a way as to circumscribe the exercise of the national authorities’ discretion so that it is not used arbitrarily.

(see paras 46-48, operative part 3)