The ongoing debate around online casino regulation in France has highlighted many of the factors, contradictions and elements that influence policy in the country. While the issues are, in some cases, specific to the industry there, they draw on parallels with other countries and can seem eerily similar to those raised in the U.S.
Still, whether or not the issues are franco-français, as the French would say, they influence both sides of the debate, whether they are opposed to further regulation of either online casino or sports betting or, on the other side, pushing for more access and regulated launches.
The annual conference of France’s online gambling trade body, L’Association Française des Jeux en Ligne, on Tuesday brought these issues into sharp relief. For example, Emmanuelle Malecaze-Doublet, chief executive of the country’s national horse racing pari-mutuel operator, PMU, explained that one of her company’s guiding projects, RetrouvonsNous (Let’s meet), was devised to rekindle the social bonds that, it says, are disappearing as societies become more fragmented, individualized, and where people spend more time on their own.
Local heroes
PMU says the project is about broadening horizons, fostering social exchanges and helping people from different backgrounds better understand each other. As part of the project, it is handing out funds to local groups that present viable plans to develop initiatives or have already established them.
PMU has around 15,000 across the country and the country’s national lottery Française des Jeux, which recently completed its €2.6bn ($2.7bn) acquisition of Kindred Group, has also repeatedly placed great store in the fact that it operates 30,000 retail outlets, where people can buy their newspapers, have a coffee, and meet up.
Many of the venues are also neighborhood bars where people meet, have a drink and buy their lottery tickets or place a bet on the horses. Emphasizing the roles these venues play in bringing people together, the companies say they act as vital social hubs for communities in rural as well as urban centers.
The next argument concerns a different gaming vertical. The country’s casino trade body, Casinos de France, represents 200 resorts across France, from glamorous Deauville and Monte-Carlo to small venues that provide up to half the annual funding of the communes they are based in.
CDF was successful in blocking the government’s online casino amendment a month ago and said it will not be a bystander and watch online casino become regulated, as online operators sweep the board thanks to huge databases of existing sports bettors that they can market their icasino products to.
In CDF’s eyes, the impact of online casino regulation on the viability of many of its smaller members could be terminal and, beyond the loss of jobs, tax revenues, and the social costs those would cause, it says the loss of venues that act as cultural, tourism and entertainment hubs would be terminal for many thermal and spa towns that only really come alive during the summer seasons.
Transpose those social and economic arguments, FDJ paid out €4.5bn in taxes to the government in 2021, PMU pays around €850m to horse racing bodies and CDF €1.5bn in local taxes every year; to those made by U.S. tribal stakeholders and their oft-stated intent to protect their communities; and the differences are not that great. North American horse racing organizations also often mention the number of jobs, the distinct hospitality and sporting experience of race meetings or the unique skills and significant funds required to maintain a strong thoroughbred breeding ecosystem.
Meanwhile, UK bookmakers’ outlets may be of a very different style than the Gallic loto or PMU bar/tabacs that are dotted around French towns, but groups like Ladbrokes or Coral often used to say their shops act as social hubs where people connect and catch up with each other. These arguments have also been made in Spain, Scandinavia and other European countries. In the interests of balance, we should not romanticize those venues, but the overall message is clear.
Context is also important
CDF was hit very hard by the pandemic closures and regularly makes the point that it is the only French vertical that is not allowed to operate online in the country. PMU had a tough few years up to the pandemic and although it seems to be turning the corner, it has benefited massively from the scale and reach its offline monopoly has provided it since the earliest days of regulation nearly 15 years ago.
Meanwhile, FDJ has been hugely aggressive since it was privatized in 2019, and this corporate strategy led it to recently acquire Kindred Group. Whole chapters could be (and no doubt will be) written about the company, but many industry contacts believe its legal status as the exclusive of online instant games bear striking similarities to online slots, but with much lower payout ratios, and that the group has huge influence over how regulatory policy develops (or not).
With regard to the latter point, its apparent opposition to icasino regulation in France, despite Kindred operating well-established European casino sites such as 32Red and Maria Casino, has also made observers highly suspicious.
The flipside of those arguments is obvious and can be summed up by the dictum ‘you can’t stop progress’. In addition, as Betclic chief executive Nicoals Béraud commented this week, despite being illegal, France’s online casino “market is already open” and with an estimated value of €2bn “is a mature market” in which four million players spend money on sites where there are no consumer protection measures. And of course, the topic of cannibalization of land-based casinos by online channels is bound to reappear at some point (So that’s another feature coming up… Ed).
All the while, should the authorities decide to regulate icasino they will have to find a way to thread the needle and balance all those competing claims to the satisfaction, or tolerance levels, of all stakeholders. That is not so different to many scenarios happening or likely to play out in the near future in U.S. jurisdictions. All are important for stakeholders and lobbying will play a huge role in shaping them, the authorities will somehow have to find a balance between them all.
