SiGMA Dutch operators fear negative effects ban on gambling advertisements

Posted: Jan 13, 2023 11:14 Category: Europe , Industry Digest , Regulatory , Posted by Maria Debrincat

Online gambling continues to rouse emotions in the Netherlands, one of the last countries in the European Union to legalise online casinos. As 2022 comes to an end, it is fair to say that it has been a bumpy ride and it is not expected to calm down any time soon.

The new Remote Gambling Bill (Kansspelen op Afstand, Koa) was only adopted in February 2019 after more than 10 years of debate in the country. The Gambling Act came into effect on April 1, 2021 — starting off the license application process — and the first regulated online casino brands went live in October 2021. In a time span of just over a year, the Netherlands has welcomed 24 regulated online casino brands.

It did not take long before newly launched online casinos in the country had to deal with heavy resistance caused by a superabundance of gambling advertisements, even leading to politicians sounding the alarm. In December 2021, a first debate was held in the House of Representatives with a majority voting for a complete ban on gambling ads. Both politicians and healthcare institutions feared a sharp rise in the number of gambling addicts due to all the gambling ads, although there is no data available supporting this.

Although the number of commercials has significantly decreased in recent months, gambling ads are still broadcasted on national TV and social media until the ban comes into effect, expected for Q1 of 2023. The Dutch gambling sector states that these ads serve an important purpose: creating brand awareness among consumers. Without the ads, players are likely to end up on unregulated websites that are still widely available.

New Regulations in Place Beginning of 2023

Shortly after his appointment in January 2022 as the new Minister for Legal Protection, Franc Weerwind was called for an interpellation debate about the status of gambling ads. After the debate, Weerwind was quick to announce that a full ban was in the making, and the proposal for a ban on gambling ads was submitted to the Council of State in October 2022. Once the Council of State has looked into the proposal, it will still have to go through the House of Representatives and the Senate. According to the Dutch casino news source it is however expected that there will not be any issues in passing the legislation, although a possible delay continues to be likely.

At present, the introduction of the ban is planned for Q1 of 2023, with gradual measures taken along the way. The first measures were already taken in July 2022, as celebrities are no longer allowed in gambling ads. This applies to all channels including TV, radio, internet, and outdoor marketing campaigns. Sponsorship deals for professional sport teams and sport events are currently still allowed, but will be completely banned from 1 January 2025.

Online advertising remains partially allowed until further notice, as long as the operator aims at players that meet the minimum age requirement of 24 years and older. Weerwind furthermore states that the gambling industry has contributed by imposing self-regulation, limiting the duration of each advertisement and avoiding broadcasts before 10 p.m.

Unregulated Operators Gain Traction

CasinoScout emphasizes that the proposed ban on gambling advertisements only affects marketing campaigns of online casinos and does not have an impact on their legal status. Gaming enthusiasts in the country are limited to signing up at online casinos that have a license from the Dutch regulator. This is where the debate continues as the gambling sector fears an exodus of players, favoring unregulated gambling companies. According to branch organizations, an advertising ban for the regulated operators is not a solution to combat gambling addiction.

“A total ban on advertising where illegal operators are already present in great numbers, will leave players prone and unprotected”, states the industry and local experts. Industry associations representing online operators in the Netherlands agree that a certain degree of advertising, for example through sponsorship, is crucial to create brand awareness. Only these brands are audited by governing bodies, therefore offering a safe environment for online gambling. Simon Lucas, an expert in iGaming in the Netherlands, agrees.

“Research pointed out by the Dutch gambling association shows that 22% of Dutch online gamblers continued to use unlicensed operators, while as many as 70% of players still find it difficult to distinguish between licensed and unlicensed operators. Joining websites that are operated by regulated gambling companies assure that consumers are best protected, as these operators fall under the jurisdiction of the Dutch gambling regulator.”

QUOTE BY: Simon Lucas, expert in iGaming in the Netherlands adds that the ban on gambling ads in the Netherlands is not an isolated case. Other countries in Europe, with some recent examples being Belgium and Sweden.  The Belgian authorities announced banning gambling ads and both online casinos and industry experts fear the negative effects of the ban. During the corona pandemic, Swedish operators were temporarily forced to introduce monthly deposit limits and cap their bonuses, leading to players in the country to join unregulated online casinos not applying any limits. Gaming authorities have tried to prevent unregulated casinos from targeting players by prosecuting the gambling companies behind the website, yet most of the actions have turned out to be ineffective.

The Dutch Gambling Market in Numbers

The first regulated online casinos in the Netherlands opened their virtual doors on the 2nd of October 2021, making it one of the youngest markets of Europe. According to CasinoScout, more data is expected in 2023, but there is already some valuable information available about the Dutch gambling market. The data has been shared by the Dutch government, branch organizations, and reputed market research agencies.

  • Turnover: in the first nine months after the opening of the online gambling market, the industry has paid € 200 million in gambling tax, according to the Ministry of Finance. This means that between October 1, 2021 and June 30, 2022 the online casinos have had a combined net turnover of € 689,7 million.
  • Players: there are 1,3 million online accounts in the Netherlands. Of these, 563,000 were actively used to gamble online during the month of July 2022 and 22% of those were owned by someone of 18 to 23 years old. According to Statistics Netherlands, 18–23-year-olds make up 9,4% of the Dutch population.
  • Accounts: with 536,000 active players in July 2022 and 14,3 million people making up the population of 18 years and older, 3,94% of the overage Dutch population has an online casino account.
  • Ad spend data from research agency Nielsen show that legal online casinos in the Netherlands have purchased € 135 million worth of advertising space in 2022.
  • Operators: there are currently 24 online operators that hold a license and have already launched their website in the Netherlands. In addition, two operators have already obtained their licenses, but have not yet launched their website.

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