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PR(04)35: Norway’s gaming machines monopoly is contrary to EEA rules

20.10.2004

The EFTA Surveillance Authority decided today to deliver a reasoned opinion to Norway regarding the introduction of a monopoly for Norsk Tipping AS on the operation of gaming machines.

On 17 June 2003, the Norwegian Parliament adopted legislation granting the state-owned gaming company Norsk Tipping a monopoly on the operation of gaming machines. Gaming machines are currently run by private operators and charitable organizations under a license system. According to Norway, the new regime is mainly motivated by the wish to prevent gambling addiction and crime, and a model with a state owned company holding exclusive rights is considered to secure better the gaming machine market.

Article 36 of the EEA Agreement ensures the right of service providers to operate throughout the entire EEA without restrictions. Similarly, the freedom of establishment under Article 31 of the EEA Agreement guarantees that legal and natural persons who wish to take up business in another EEA State are not prevented from doing so by the host state. Limitations on these freedoms may be accepted only if the State in question shows that the restriction imposed is non-discriminatory, justified by imperative requirements in the general interest, suitable for achieving the objective which it pursues and does not go beyond what is necessary in order to attain it.

The Authority does not dispute that the aims relied on by the Norwegian Government, are laudable and can, potentially, justify a restriction to a fundamental freedom. Furthermore, the Authority is not questioning the competence of the Norwegian Government to regulate the market, e.g. by requiring a reduction in the number of gaming machines.

In the Authority’s view the Norwegian Government has not shown that its gaming policy is systematic and consistent enough to justify restrictions of the basic freedoms provided for by the EEA Agreement. In this context, it is noted, inter alia, that consumers are encouraged to play different games and that the Norwegian State, through Norsk Tipping, has lately increased the number of available games and means of gaming. Moreover, the Authority regards the legislation to be contrary to the principle of proportionality as the objectives pursued by the enactment of the legislation could have been reached by less restrictive means, e.g. imposing more stringent conditions on the private operators. On the basis of these considerations the Authority concludes that Norway has infringed Article 31 and 36 of the EEA Agreement.

A reasoned opinion is the second stage in the Authority’s formal infringement procedures against a Member State. The Norwegian Government is required to comply with the reasoned opinion within one month following notification.

For further information, please contact Mr. Tor Arne Solberg-Johansen, Press and Information Officer, tel. (+32)(0)2 286 18 66.

20 October 2004




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