Danish Gambling Monopoly Restructures, Prepares for Regulation

Plans to regulate internet gambling in Denmark are in the works, and even though objections from the EC regarding gambling taxes have slowed down progress, many expect the country’s online gambling industry to open up sometime in 2011. The nation’s current gambling monopoly, Danske Spil, is now making moves in preparation of what is to come.

The current gambling tax in Denmark is 41%, but this applies strictly to land-based operators. Proposed changes to Danish gambling laws have set the tax for online casinos at less than half that. The EC has expressed concerns that this may give online operators an unfair advantage. The opening of the nation’s online gambling industry was originally scheduled for the first of January 2011, but on December 15 the EC launched an investigation into the proposed gambling tax, setting this date back many months.

Hans Christian Madsen, the chairman and chief executive of Danske Spil, believes nothing will come of the complaint. He insists that the land-based gambling tax will never be lowered, and that online gambling is such a different beast that it cannot be compared with land-based gambling. The issue, however, is now in the hands of the EC, and nobody knows when a decision will be made.

In the meantime, Danske Spil has begun to restructure in preparation of the upcoming changes. The monopoly will be split in three. One company will deal with products that are aimed to participate in the newly liberalized gambling market, and to compete with foreign license holders. This group will offer a variety of internet gambling services, including casino games, sports betting, and online poker in Denmark.

The second group will handle lottery, scratch games, horse racing and bingo, which will remain under the control of the country’s gambling monopoly. The third division will focus on managing the 5,000 video lottery terminals currently owned by Danske Spil.