Gambling monopolies in the EU: the case of Poland (Part 1)

Poland’s gambling legislative is one of the most discouraging in the European Union concerning foreign investments in the online gambling sphere.

The recent economic crisis in Europe opened the possibilities for states to intervene in their economy in the best way they could in order to save entire economic sectors. The ways they intervened on the global market are already well known, however little is known about how they intervened on the under-regulated online gambling market. According to GamingZion’s comparative analysis some countries intervened in the unregulated online gambling sphere in a manner that paved the road for creating national monopolies in the sector.

One such case is the Polish gambling environment. We are currently witnessing an exodus of foreign operators not only from Poland but from the whole Central and Eastern Europe mainly due to the monopolization of the previously unregulated market. However, as online gambling sites in Poland stress, the reasons for these policies vary from country to country. In the next two articles of the “gambling monopolies in EU” series GamingZion presents these reasons in the case of Poland.

The numbers behind the Polish gambling market

The online gambling market in Poland has before December 2016 been entirely composed of online betting transactions, as other forms of online gambling were unregulated. The only online gambling exception in these respects were the offers of the lottery, whose status was “lottery products”, as gambling news report. According to the statistics in regard of the Polish online betting market we might conclude that Poland is one of the least developed gambling countries in Europe. 

Basic statistic indicators of the online betting market in Poland

• Turnover tax: 12 %

• Gross Gaming Revenues (GGR) in 2015 : EUR 83.2 million

• GGR per adult: EUR 2.5

• Taxes collected from betting in 2015: EUR 11.2 million

If we take into consideration the Gross Gaming Revenue (GGR, the sum of all online stakes minus the sum of returns, in one country, for period of one year) from betting only per adult person in Poland (over 18 years old), we come to an average of EUR 2.5 in 2015. This is considerably lower not only from the developed gambling markets from other parts of Europe such as in the UK whose GGR is EUR 40.3 or Denmark with a GGR of EUR 41.9 but also from the neighboring Czech one of EUR 20.1. Even restrictive gambling environments such as the French one, have a considerably higher GGR than Poland with EUR 14.7

How is the Polish market regulated?

Gambling in Poland is regulated by the Ministry of Finance. With the Gambling Act of November 19, 2009 which was fully on force in 2010, the Polish state created a national monopoly over all legal gambling activities. According to this act, as gambling sites in the EU report, all online gambling activities which are not licensed for a specific purpose are considered to be forbidden.

In July 2011 the first licences for online gambling in Poland became available. In this “first wave“ of liberalizing the Polish gambling market it was said that any company that is registered in Poland and has at least three shareholders is eligible to apply, meaning that foreign operators have to establish a Polish subsidiary in order to avoid legal sanctions imposed by the Polish court system. However, costs and taxes are so high that until 2016 only a few operators were admitted to provide services. These mainly included Fortuna, Millenium and STS.

In December 2016, the Polish legislative chambers agreed to introduce changes in the gambling act in a way that it will include online casino games, as well as online poker and bingo. However, this liberalization of the whole sector does not come with a plurality of offers. On the contrary, only Totalizator Sportowy, the state gambling monopoly will have the possibility to introduce these gambling games. Foreign operators are practically left outside the game. What this measures amount to, what the objective of the Polish Ministry of Finance is and what the experts claim on the new policies will be in detailed elaborated in the next Gaming Zion article on the Polish monopoly.