Online Gambling Execs Vexed by French Laws

Online gambling in France is legal, but whether the current laws benefit consumers has been called into question. The issue is threefold: (1) taxes, (2) payout limits, and (3) excluded games. These issues have been discussed at the Monaco iGaming conference in Monte Carlo.

Licensed gambling industry operators catering to the French market are required to submit 40% of their revenues as tax. David Zerah, chief executive of 888’s Dragonfish offered the opinion that the taxation has “gone a little too far” and removes most profit advantage from entering the French market. ChiliGaming’s Alexandre Dreyfus, concurred that the tax is “painful”, but more optimistically added that the French market could grow and offer brand-building opportunities.

A bigger gripe for many of the casinos operates is the 85% payout limit. This regulation tries to protect the local economy by minimizing the incentive for irresponsible play. It sees reasonable that gamblers are more likely to sink more money into wagers where they can win more even if they cannot afford the losses. Therefore, by denying bet makers the higher incentives, they may squander less money.

While such protections may inhibit localized gambling in brick-and-mortar establishments, the internet does no t have such firm borders. Customers can easily go where they feel they get the best value.
Mangas Gaming’s executives Tarquin Henderson and Nicolas Beraud pointed out the fallacy of this reasoning. If a gambler wants a chance at a higher return, he can and will still find the big payoff games. This makes it “very hard” for these licensed internet gambling sites to compete and retain customers in the French market. As these gamblers are pushed elsewhere, they move outside the protection of French law.

Moreover, according to Zeturf CEO Emmanuel de Rohan Chabot, as a result of this restriction, French gamblers loses almost twice as much money, as the typical French gambler at their casino now loses €110 per month, compared to €60 before liberalization.

Less of an issue, but still causing grievance as cited by Dreyfus, the current licensing spectrum permits French poker rooms but does not allow for casino games. Again, rather than protecting consumers, it forces them to seek their entertainment elsewhere.

Not everyone at the conference felt the tax and payback issues where the biggest problem. Aymeric Verlet, PMU’s chief of international development is more concerned about the illegal operators. If these rouges could be kept out of the French marketplace, online gambling sites in France would be economically viable despite these other issues.