Hungarian online gaming legislation incompatible with EU law

Hungarian legislation on the authorisation of online games of chance has been found not to be compatible with the principle of the freedom to provide services.

Maltese company Unibet International’s business consists of the organisation of online games of chance.

In 2014, Hungarian authorities established that Unibet was providing, on Hungarian-language internet sites, services relating to games of chance without licences required in Hungary to carry on such an activity.

Unibet then brought an action before the Fővárosi Közigazgatási és Munkaügyi Bíróság (Administrative and Labour Court, Budapest, Hungary) seeking the annulment of the decision on the ground that the Hungarian legislation underlying them was contrary to the principle of the freedom to provide services.

Unibet took the view that Hungary in practice excluded it from the opportunity provided for under Hungarian law to conclude such contracts as a ‘trustworthy’ operator of games of chance.

By its judgment delivered this week, the Court of Justice stated that the national legislation at issue, which prohibits the organisation of games of chance without prior licensing by the administrative authorities, constituted a restriction of the principle of the freedom to provide services.

The Court of Justice also stated that no penalties may be imposed on the basis of rules held to be contrary to the principle referred to above.

For the full judgment, please click here.