Hungarian Court Upholds Ban on Gaming Machines

The Constitutional Court in Hungary has upheld a government ban on gaming machines, despite opposition from two major players and an industry watchdog. The government’s recently changed Hungarian gambling laws passed the entirety of the country’s gambling operations under the umbrella of state monopoly Szerencsejatek.

The ban was announced a year ago, and many small gambling halls have closed their doors in the meantime. Budapest used to have a proliferation of gambling halls, but now all gaming must take place in the two Budapest casinos: Tropicana and Las Vegas Casino. The government has also decided to attempt legislation to tax online casinos in Hungary.

Under proposals, the government will introduce 5 year licenses that will cost HUF 100 million – around $450,000 – a year, as well as a 20% tax. This is seen as prohibitively expensive by some operators, but is an encouraging sign as Hungary opens up its online market for liberalization.

Meanwhile, in connected gambling news, revenue from Hungary’s 3 land based casinos shot up after the banning of gambling machines. The two casinos owned by Szerencsejatek showed a 35% increase in revenue from the previous year, as gamblers flocked to those locations after their old gambling halls were closed.

This means that, despite the government’s protestations that the move was for the benefit of its citizens – and that it would lose HUF 30 million from the ban – more revenue was bought in through the state run monopoly than ever before.

Whatever the future holds for gambling in Hungary, there is no doubt that the EU is likely to get involved, considering their involvement in a series of other legislative moves the government has made in recent times. The story of changes to Hungarian laws has only just begun, and operators will surely be put off by the government’s frequent mood swings.