EEGS 2008 - the Bulgarian Variant of Brainstorming

The main topics discussed at this 3-day forum encompassed a large range of issues like the gaming industry regulatory framework, the strengthening of the social responsibility of the business, casino marketing, the quality and technological aspects of the products, the synergy between gaming and tourism.

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In the panel dedicated to gaming legislation, most of the presentations dwelled on the regulation of online gaming. The rapid entrance of the new technologies and the expansion of online gaming set forth the issue of a regulation which is in conformity with the law and compliant with strict rules, stated Dimitar Terziev, President of the State Commission on Gambling, in his presentation Legal Framework of the Gaming Business in Bulgaria. According to data of the Ministry of Interior there are about 40 000 web sites offering such games, many of them translated in Bulgarian language and visited by Bulgarian citizens. The State Commission on Gambling has investigated many of these sites and has respectively notified the prosecuting bodies in the country, Mr.Terziev stressed. He also pointed out that the pending amendments of the Gambling Act foresee strict regulation of online gaming. The amendments will set requirements that the servers are situated on the territory of Bulgaria and linked to the National Revenues Agency, so as allow a monitoring of all bets. Another amendment will refer to the registration of the participants so as to rule out the possibility for people under age to practice such games. Those who wish to participate in online games will receive an identification code to make them recognizable online. There will be a requirement for the web sites of the licensed operators to describe the terms for participation in online games, the payment procedures and the measures undertaken to protect the personal data of the players. Other amendments will address the issues of unauthorized interference, the rights of the players with respect to the gained sums, the fairness of the bets and the restriction of advertisements in unlicensed web sites.

There is still no common directive in Europe on the regulation of the national markets in the area of online gaming. Each country should make its own decision, stated Eric Van Vondelen, Secretary of the Gaming Regulators European Forum. The model of regulation varies from full prohibition like in the USA, to a more liberal legislation in the sector. Mr. Eric Van Vondelen also indicated that the biggest problems at the moment are the leakage of funds and the evasion of taxes.

The regulation of online gaming is a task which is in the focus of attention of all Europe. For the first time the business and the market have gone ahead of the regulation. In some countries like Great Britain the regime is largely liberal. In Italy and France the sites of companies which do not hold a national license are blocked. France has even gone further – the commercial banks are obliged to decline transfers from unlicensed gaming sites. Most extreme for the moment is Germany. A law was enacted by force of which online games operators have been obliged to close their web sites within a period of three years. However, the truth of the matter is that the market is successful in evading such restrictive policies. It is technically impossible to block web sites. In Italy, for example some 30 000 gaming sites were blocked, but only a few months later another 35 000 new sites emerged on their place, explained Constantinos Dimitriadis, a lawyer with the European Commission. According to him the idea of restricting internet betting by blocking the payment of the profits through the commercial banks does not work, as it is not a problem to open a bank account in another country, where no such restrictions exits and receive the transfers from there. He also attracted the attention of the audience to another case – many of the countries which ban online gaming may be sued by the affected companies because these measures can be interpreted as a restriction of the right to free trade. According to data of the European Commission in 2004 online sports betting in the EC generated a turnover of 2.3 billion EUR , and the expectations are that by the year 2010 it will grow up to 20.8 billion EUR .

One of the goals of the gaming industry in Europe is to work jointly with the EU institutions in developing a common regulatory basis of online gaming, organized by media with trans-border coverage like internet and the satellite TV channels, stressed Eduardo Antoja, Honorary President of EURO MAT. According to him Bulgaria is among the EU member countries with a good regulation of the gaming industry, which is in line with the development of society, rather than copying foreign models. Last year only the total incomes reported by the gaming industry in all 27 member countries of the EU amounted to 70 billion EUR , including 20 billion EUR form slot machines. This is only 3 billion EUR less as compared to the incomings from the national lotteries. The incomes from betting (9 billion EUR ) and the traditional casinos with croupier (10 billion EUR ) are much lower.

Fredric Gushin, managing partner of Spectrum Gaming Group, USA spoke about the international regulatory trends. He noted that the regulatory basis in the different countries at the moment is much more liberal than in the past, mostly due to the fact that gaming is already perceived by society as a legal business. He also noted that the public goals in the gaming business policies such as reinvestment, tax revenues, job creation, etc. are often adversely affected by the government policies, also because of the high tax rates and the unrealistic expectations.

Of interest to the participants in the summit were also the topics connected with the development of marketing strategies, the business environment, the new technologies, the certification of the gaming equipment and their exploitation. 46 experts made presentations from Bulgaria, Austria, Russia, Serbia, Slovenia, USA, Great Britain, Latvia, Italy, Germany, Greece and Estonia.

Special attention was devoted to the development of the sector towards gaming tourism. The participants in the panel discussed the possibilities to create a similar tourist service in Bulgaria and stressed the importance of this attractive product for the development of tourism at large.

In the past Bulgaria used to be an excellent model of synergy between the gaming industry and tourism, and the future will show if we will be able to work together and develop a comprehensive market of the type of Las Vegas, Angel Iribozov pointed out, Chair of the Management Board of BTAMOGI. Bulgaria’s accession to the EU , the favorable investment climate, the priority place of tourism in the Bulgarian economy are among the main factors which have an impact on the gaming industry in the country, he indicated.

According to Bob Miller, President of the International Association of Gaming Industry Advisors and ex governor of Nevada, our country still has a lot of improvements to make with respect to the development of entertainment tourism of which gaming is an integral part. Bulgaria should continue to improve its competitiveness, because all countries on the Balkans, except for Turkey, have already liberalized the gaming business.

Lucien Wijsman, co-owner of Slot Academy, touched upon the issue of marketing in the casino industry. Marketing is not only the arts of making sales, it is also the skill to understand what the clients want and to deliver it, he pointed out. According to him the casino industry has a lot to do in this respect in order to be able to implement adequate marketing policies both in the interest of the players, and in the interest of the business.

Pieter Remmers, member of the board of the European Association for the Study of Gambling and Lavrenty Gubin, head of the Responsible Gaming Fund in Russia, presented the topic of the social responsibility of the business, which is gathering momentum in the recent years. A successful business in the gaming industry is possible only if goes hand in hand with social responsibility. Although the problems related to gambling addiction in the different countries are similar, each country should carry out its own research to estimate the level of addiction to games, and impose mandatory standards to restrict this phenomenon.

After the presentations round table discussions were organized by countries in the course of 3 days, where the participants shared their experience and had the chance to get an answer to their specific questions a bout the different national regulatory frameworks.

present the state of the gaming business in Bulgaria to the international audience and advertise the attractiveness of the Balkan region to the potential investors went beyond the scope of a regional event. The organizers and the participants estimated highly the summit which opened up a new page in the development of the gaming industry not only in Bulgaria but also on the Balkans.