The Gambling Law Review: France
The French Homeland Security Code (HSC) defines gambling as 'any operation made available to the public, regardless of its designation, for the purpose of causing the hope of a gain whose realisation depends, even partially, on chance and in consideration for which the operator requires a financial contribution from participants'.2
This definition is often broken down into four criteria. A prohibited gambling offer is regarded as any game: (1) that is offered to the public; (2) that presents a chance of gain for the players; (3) whose outcome partially results from chance; and (4) that requires a financial contribution from the player, regardless of the actual designation and nature of the game, and whether a later reimbursement of the financial contribution is possible or not.
In addition, the HSC specifies that 'online gambling' should be seen to be any gambling or betting operation performed exclusively through an online communication service, and that 'online gambling operators' are all persons offering to the public, on a regular basis, online gambling or betting services with stakes having a monetary value and under terms and conditions that constitute a standard agreement to be accepted by the players.3
ii Gambling policy
Under French law, agreements relating to gambling and betting are to be construed as aleatory contracts, in which the importance of the profits and losses incurred by either or both parties shall depend on the occurrence of an uncertain future event.
Gambling on games of chance has been forbidden for a very long time under French law, and this prohibition is currently expressed in Article L.320-1 of the HSC and 'such interdiction shall also apply to games whose functioning relies on the player's skills' pursuant to the same Article.
The classic differentiation that existed under French law between wagering on games of chance or wagering on games of skill – the former being forbidden and the latter licit – has thus been abandoned, and both types of wagers are now explicitly prohibited under French law, as French authorities considered that the dangers of compulsive and addictive gambling do not vary with the degree of skill or chance required.
If the prohibition of gambling can thus be considered a general principle of French law, it is important to note that a very important number of exceptions and specific regimes do exist. From the gambling operator to traditional cockfighting, through the countless online offers, the study of French gambling law is that of a series of exemptions and exceptions detailed herein.
iii State control and private enterprise
The National Gambling Authority (ANJ), created by Ordinance No. 2019–1015 of 2 October 2019, has taken over the powers of the former Online Gambling Regulation Authority (ARJEL) and has been also granted new powers. The ANJ is notably competent for issuing licences to online gaming and sports betting operators. The ANJ's scope of intervention is extended to operators holding exclusive rights (La Française des Jeux (FDJ), Pari Mutuel Urbain (PMU)), which have to submit each year to the ANJ's approval their (1) gaming programme, (2) promotional strategy and (3) action plan for the struggle against excessive gambling and underage gambling, fraud, money laundering and terrorist financing.
Additionally, the ANJ has recently been granted the power to order internet service providers to block access to sites that offer illegal gambling and sites and that advertise it, under the control of the administrative judge.4 This new law of March 2022 replaces the current judicial procedure for blocking illegal gambling sites with an administrative blocking procedure.
The ANJ is an independent administrative authority. The modalities of operation and organisation of the ANJ as well as its powers of control and sanction are defined by Decree No. 2020-199 of 4 March 2020, supplemented by Decree No 2020-1349 of 4 November 2020.
A summary of the holders of exclusive rights and other licence holders is set out below.
La Française des Jeux
The French National Lottery was created in 1933 for the purpose of aiding war veterans. FDJ, the gambling operator, was founded in 1976 and inherited the exclusive rights on the organisation of lottery games that had previously been granted to the French National Lottery. In 1985, sports betting was authorised in France for the first time and exclusive rights on the organisation of such activity were also granted to the FDJ by decree.
However, with the coming into effect of the Online Gambling Law, the FDJ applied for and obtained a licence as an online gambling operator and was confronted with competition for the first time. The FDJ ventured into the organisation of online poker events, but it quickly withdrew from such activities. The FDJ also developed a complete online sports betting offer.
The FDJ, however, remains a giant in the French gambling market.
Privatisation of the FDJ was voted on, on 11 April 2019 through the PACTE Act, and the government decided to support the transfer of the majority of the capital of FDJ to the private sector by organising state control over the company, notably through the presence of a government commissioner on the board of directors.
The Pari Mutuel Urbain
Horse betting in hippodromes was authorised and regulated in France in 1890. In 1930, horse-racing companies, which were solely allowed to organise horse betting, were authorised to propose betting on their races outside of hippodromes. Those licensed horse-racing companies decided to establish a common structure, the Pari Mutuel Urbain (PMU), to provide betters with a centralised service. In 1985, the PMU became an economic interest group, gathering 57 horse-racing companies – all non-profit associations. Today the PMU is the largest European horse-betting operator.
Similarly to the FDJ's situation with sports betting, the PMU has been facing competition online after the online horse-betting market was opened to competition and regulated by the Online Gambling Law in 2010, thus reducing the scope of the PMU's exclusive rights. The PMU also decided to venture into the online gambling market following the coming into effect of the law and obtained licences from the ARJEL (now the ANJ) to offer horse betting, sports betting and poker games online.
The PMU has retained its exclusive rights on the organisation of land-based horse betting on French territory and has also become one of the largest operators of online sports betting in France.
Since 1 January 2020, the operation of any new game by FDJ or PMU is subject to the ANJ's prior authorisation, which may be suspended or withdrawn at any time. The ANJ may also require the withdrawal of any commercial communication made by the FDJ or the PMU containing excessive gambling incentives.
Casinos can be opened following a very specific licensing procedure, which involves public authorities at both national and local levels. Each individual casino needs to obtain a licence from the Ministry of Home Affairs, which can only be granted in specific geographic areas listed by the applicable law, which are detailed in Section I.iv–I.vi.
Gaming circles were non-profit associations that were allowed to offer specific card games of chance to their members as long as the gaming activities they offered remained a simple accessory to other activities of a social, cultural or charitable nature. Gaming circles were not allowed in cities in which there was a casino, but numerous gaming circles existed within Paris. All but one of those, however, have been shut down by public authorities, and the single remaining one has been ordered to modify its legal structure into that of a gaming club, a new type of profit-based legal entity whose creation was authorised since 2017 on a trial basis by the French National Assembly.
Licensed online gambling operators
The FDJ and PMU's monopoly over online gambling and betting ended with the coming into effect of the Online Gambling Law, which authorised licensed privately owned online gambling operators to offer three types of online gambling services: sports betting, horse betting and gambling ring deck card games (although poker was and remains the only such game authorised).
Many private operators requested and obtained licences when the Online Gambling Law was first passed, but only 15 licensed operators still exist on the French online gambling market today (including FDJ and PMU).
The licensing process and specific obligations imposed on online gambling operators are detailed further in Section III.
iv Territorial issues
Even though the French national territory is generally perceived as a whole and treated as such under the law, a few territorial issues specific to the regulation of gambling do exist.
A few localities in Northern France and on the island of Réunion (a French overseas region located in the Indian Ocean) are allowed to maintain their gallodromes, traditional cockfighting pits, as cockfighting is an ancient local custom that has continued without interruption to this date. A few gallodromes still exist, but the creation of any new ones has been expressly forbidden by the French authorities.
Specific law applicable to Paris
A law adopted in 1920 expressly forbids the installation of a casino in Paris or within a radius of 100 kilometres around it. This interdiction is still applicable today, which makes Paris the only European capital without a casino.5
Instead of actual casinos, several gaming circles existed in Paris, but their offers were highly regulated and limited to a much smaller number of games than casinos. Since 1 January 2018,6 an experimental law suppressed the specific regime applicable to gaming circles and authorised the government to experiment initially for three years with the creation of gaming clubs, a newly created type of legal entity, in Paris. This experimentation has been extended for a total of seven years, expiring on 1 January 2025.
Besides the general prohibition of casinos in Paris, the law specifies in much detail the geographical settings in which the operation of a casino can be considered: licences can only be granted by cities hosting significant seaside, thermal or climatic resorts, as well as touristic cities of more than 500,000 inhabitants that are equipped with a national theatre, orchestra or opera, and that contribute more than 40 per cent of the financing of the concerned cultural institution. In relation to the requirements applicable to this last category, French law even goes so far as indicating a minimum number of annual events that should be hosted by those cultural institutions to permit the opening of a casino.7
v Offshore gambling
If the territorial scope of gambling law obviously limits the actions that the French authorities can undertake in order to prevent offshore casinos targeting French consumers from a legal point of view, several mechanisms have been implemented by law to fight these practices and limit online access to these casinos from France.
The ANJ is, therefore, now authorised to order internet service providers and hosting providers to block access to reported websites and search engine operators to stop referencing them.
The ANJ can also propose that the Ministry of the Budget impose measures for blocking financial flows. Illegal operators are also subject to criminal penalties.
French gamblers do not incur criminal penalties; French authorities simply insist on the fact that players willing to take such risks will not benefit from its protection and are more likely to be taken advantage of by fraudulent websites.
Casinos on French ships
The law provides that casinos can be installed on board French commercial ships transporting passengers under specific conditions.8 In particular, such casinos are only allowed to operate (1) outside the administrative limits of seaports, as regards ships transporting passengers operating on a regular service to or from ports of the European Union; and (2) in international waters as regards other ships.9
Legal and regulatory framework
i Legislation and jurisprudence
Most regulations applicable to gambling and betting operations under French law are contained in the Civil Code, the Homeland Security Code and the Online Gaming Law, but the provision of a number of other gambling products is governed by specific laws and regulations.
Civil, commercial and criminal courts have all rendered decisions whose study is relevant when considering French gambling law as an ensemble, but statutes remain the primary source to examine in France. In terms of gambling, French case law is mostly limited to the interpretation of that primary source.
Over its decade of existence, the ARJEL (now ANJ) delivered a number of decisions and opinions that have helped to outline the French gambling landscape, and the ANJ website, on which all the decisions taken by the ARJEL and the ANJ are available, is one of the first to consult when considering whether an online gambling activity could be licit under French law.
ii The regulator
Gambling in France is regulated by different public authorities and administrative bodies, whose jurisdiction depends on the nature of the considered gambling activity and, in particular, whether it is land-based or online.
Land-based gambling regulator
The activities of the FDJ and the PMU as holders of exclusive rights are supervised by the ANJ.
The Ministry of Home Affairs issues all land-based gaming licences, regardless of the type of establishment considered. While the opening of any casino or PMU retailer has been subject to prior authorisation from the ministry for years, a recent decree has imposed the same obligation for the opening of any FDJ retailer.10
The Renseignements Généraux (the intelligence division of the French police) were for a very long time responsible for enforcing compliance with French gambling law, but were dismantled in 2008 as part of a reorganisation of French intelligence services. The Service Central des Courses et Jeux (SCCJ), a new police service specifically focused on gambling activities and responsible for the surveillance of gambling establishments and hippodromes, was then created by the adoption of a decree.11
If local prefects perform most of the day-to-day administrative functions in relation to land-based gambling, diverse commissions (in particular, several committees within the Ministry of Home Affairs and the Ministry for the Economy and Finance) have exclusive regulatory powers in relation to specific gambling activities.
Online gambling regulator
Online gambling in France is supervised by the ANJ, a public entity created by Ordinance No. 2019-1015 reforming the regulation of gambling and games of chance that was adopted on 2 October 2019 and came into force on 1 January 2020. The ANJ has replaced the ARJEL, which had been created by the Online Gambling Law in 2010. The ANJ took over the ARJEL's powers and has vast and numerous powers and is, in particular, responsible for granting licences, enforcing online gambling regulations, as well as fighting against gambling addiction, illegal gambling websites, and fraud and money laundering.
iii Remote and land-based gambling
French gambling law, as previously discussed, is built around the principle of a general prohibition, in which successive laws have carved various exceptions and exemptions. Laws and regulations have defined the conditions under which the FDJ can offer lottery games or sports betting and the PMU can offer horse-race betting, but land-based gambling itself does not have an actual definition under French law.
Remote gambling does not have a legal definition, either. The activities authorised under licence by the Online Gambling Law are indeed remote gambling, but they only cover internet-based gambling services and one should therefore consider that it does not apply to any other form of remote gambling (through post or phone communication, in particular). One should, however, note that the French authorities consider that the licence granted to online gambling operators authorises them to offer mobile phone applications to provide access to their services, if such applications offer the necessary guarantees in terms of security and if the offered services are compliant with the granted licence.
iv Land-based gambling
The most notable derogation from the prohibition of gambling in France dates back to a 1933 decree that authorised the creation by the French government of a monopolistic national lottery, which has survived to this date. This national lottery is now called the Loto and is managed by the FDJ, as detailed above.
Besides the Loto, EuroMillions and the other games of chance offered by the FDJ, lotteries that are made exclusively for charitable or non-profit purposes, traditional lotto and bingo games offered to a limited audience for an insignificant price, fairground lotteries and promotional lotteries offered within the context of marketing campaigns can also be authorised, subject to compliance with a number of specific rules.
Horse racing has an ancient history in France, and horse-racing companies have been allowed to offer pool betting since the late 19th century (the term 'pari-mutuel' and the concept it describes, which are now commonly used across jurisdictions, are originally French). Betting offers on horse racing are now subject to exclusive rights held by the PMU.
Sports betting has been allowed in France since 1985,12 but has been subjected to a monopoly. The FDJ, the semi-public company that holds exclusive rights on lottery games, was given exclusive rights on the organisation of sports betting in French territory. If that holding of exclusive rights still exists today, its scope has been reduced to cover only land-based sports betting since the adoption of the Online Gambling Law.
Casinos are allowed only in specific areas in France, subject to a licence by the Ministry of Home Affairs and placed under the authority of that ministry and that of the Ministry of the Budget. Casinos are heavily regulated, and the very nature and rules of the games that they are allowed to offer is determined by the public authorities.
Gaming circles and clubs
All gaming circles have closed down, except a single one in Paris, and a new form of company called a gaming club was created under French law in 2017. Gaming clubs must obtain a specific licence from public authorities and they are allowed to offer even fewer games than casinos, but they are not subject to the specific geographical restrictions applicable to casinos.
Greyhound racing and cockfight betting
Greyhound betting is also allowed, but greyhound races are not very popular in France, and the audience interested in gambling on such events is quite small. The audience interested in betting on cockfights is even more limited, but the practice remains tolerated as part of a cultural exception specific to very few localities.
v Remote gambling
Any operator, whether foreign or France-based, that intends to market online gambling services targeting French users needs to apply for a gambling licence with ANJ.
To assess whether an operator targets French users, several criteria will be taken into account, and the authorities will, in particular, verify whether the website is registered with a .fr domain name or drafted in the French language and whether the offered services are blocked for French users or presented in a manner that appears to specifically target French users. For instance, French courts have considered that a foreign-based online gambling website registered with a .fr domain name, containing the mention 'First Poker Website in France' and indicating a French contact phone number, should be governed by French law.
French authorities provide an exhaustive list of the games and events that are authorised under the Online Gambling Law:
- poker games: Texas Hold'em limit; Texas Hold'em pot limit; Texas Hold'em no limit; Omaha 4 High pot limit; Omaha 4 High/Low limit; Omaha 4 High/Low pot limit; Omaha 5 High pot limit; Seven Card Stud Poker High limit; Seven Card Stud Poker High/Low limit; Seven Card Stud Poker Razz (or Low) limit; Triple draw deuce to seven (2–7) Lowball (or low) limit;
- sports betting: a list detailing the sports competitions that can be subject to online gambling and the types of events in such competitions that can be subject to betting (number of goals, final score, etc.) is regularly updated by French authorities; and
- horse betting: a schedule mentioning the horse race events that can be subject to online gambling is published by French authorities every year.
vi Ancillary matters
Protection of minors
Specific decrees expressly forbid the provision of any gambling services to minors and the payment of any gambling gain to minors.13 By the adoption of the PACTE Act on 11 April 2019, the legislator empowered the government to establish a fine for the sale or free offer of gambling to minors. In this regard, Decree No. 2020-1773 of 21 December 2020 has created two fourth-class offences (up to €750) punishing non-compliance with the prohibition on the sale or free offer of gambling to minors and the failure to post notices aimed at protecting minors and persons prohibited from gambling.
Gambling operators are required to prevent minors, whether or not emancipated, from participating in any gambling activity (the participation of minors in gambling activities is only allowed for very specific types of games, such as lotteries in relation to non-profit purposes, fairground activities and traditional bingos).
Licensed online gambling operators must require all players to indicate their age at subscription and upon every subsequent visit to their websites. In addition, their websites must feature a warning stating that minors cannot participate in gambling activities, whose precise contents and appearance are strictly regulated.
Protection against gambling addiction
Any individual who wishes to fight his or her gambling addiction can request his or her voluntary inclusion14 on a list of compulsive gamblers, which is communicated to casino, gaming club and gambling website operators.
Since 31 December 2020, the management of the voluntary gambling bans file, previously held by the Ministry of Home Affairs, has been entrusted to the ANJ. The ANJ now offers a renovated and easily accessible service, simplifying the registration process and reducing the time needed to validate this step. Players no longer have to go to a police station, and their registration can now be done entirely online.
All such operators must actively prevent listed players from participating in any gambling activities. Licensed online operators are also required to:
- display information on their websites regarding the existence of the list and the possibility for players to receive help;
- offer self-exclusion mechanisms to players seeking temporary or definitive withdrawal from the games;
- immediately terminate the account of any individual that becomes listed; and
- require, as part of their account creation processes, that players set a weekly limit on the amounts that can be transferred from their bank account to their gambling account and on the cumulative amount of stakes they can gamble.
FDJ and PMU retailers are not required to verify whether players are listed as compulsive gamblers.
Land-based casino managers and board members must obtain an authorisation from the Ministry of Home Affairs, which can be suspended or revoked at any time. Indeed, changes in the situation of the managers and board members are closely monitored by the Ministry of Home Affairs. Similarly, all staff members with responsibilities relating to access control, security personnel and CCTV operators must obtain a specific authorisation from the French Ministry of Home Affairs.15 Newly authorised staff members must undergo special training to monitor players and detect signs of compulsive and addictive gambling.16
The rules applicable to online gambling operators are less comprehensive, but the ANJ may refuse to grant a licence to an operator if any of its owners, managers or executive officers have been convicted in the course of the previous 10 years for committing any of a series of criminal offences listed by decree.
A guide detailing the technical requirements applicable to online gambling on the ANJ website provides details regarding the technical requirements that online gambling operators must comply with. In particular, the software (and each new major version of the software) must be approved by the ANJ prior to the beginning of any online gambling operation using the software concerned.
Applications must contain the source code of the concerned software and random number generator, as applicable. It must also contain a security vulnerability analysis detailing the reasons of such vulnerabilities, how they affect the operation of the software and how they can be remedied.
The application for approval must also contain a specific analysis that covers potential vulnerabilities and, in particular, establishes through statistical tests that:
- the generating processes are actually random;
- the random results are not foreseeable even with a thorough knowledge of the algorithm, the generator and previous results; and
- generated data series are not repeatable.
vii Financial payment mechanisms
Prior to using online gambling services, players are required by French regulation to open a player account.
French regulations provide for specific rules for the funding of players' accounts, as well as for the reimbursement of funds to players. A player's account may only be credited by its holder or by the gaming operator either for winnings earned by the player or as a promotional offer.
Provisioning of a player's account by its holder may only be carried out by means of payment instruments issued by a duly authorised payment service provider (PSP), including payments by credit card, prepaid card, electronic money wallet and wire transfer.
The player's assets can only be transferred to the player's payment account. The player must communicate to the operator the references of this account when opening his or her player's account. However, cryptocurrencies in themselves are not covered by the categories of payment methods authorised.
The licensing process
i Application and renewal
Land-based gambling operators
As the FDJ owns exclusive rights on the organisation of lotteries and land-based sports betting and the PMU owns exclusive rights on the organisation of land-based horse betting, there is actually no licensing process to describe in this Section.
Licences can, however, be obtained to open casinos in specific locations, as previously discussed. Even though a legal entity or an individual can operate several casinos in different places, each casino must be the object of a single application process and the licence potentially granted will only apply to such establishment.
Before a casino can begin operating, the applicant that wishes to become an operator must reach an agreement with the host city and obtain a formal authorisation from the Ministry of Home Affairs, which will remain subject to diverse forms of control by different public authorities and is of a temporary nature. Indeed, the law provides that the duration of the agreement between the casino operator and the city cannot exceed 20 years and that the licences are themselves temporary.
Online gambling operators
Companies willing to obtain a licence must submit a separate application for each gambling category in which they want to operate (gambling ring deck card games, horse-race betting or sports betting), but a single company can submit three distinct applications and attempt to obtain the three types of licence from the ANJ. The decision to issue or refuse a licence is taken by a specific ANJ committee, which can grant operators a non-assignable renewable five-year licence.17
The ANJ issues licences only to operators that have the technical, economic and financial capacity required to comply with their obligations, both in terms of gambling service and in terms of public order protection, anti-money laundering, public security, and the fights against terrorist financing and compulsive gambling.
In the application form, the operator must, in particular, provide a description of its economic, financial and accounting state and information concerning:
- its gambling website;
- the gambling services it intends to operate;
- the accounts of the players;
- the actions it intends to take against compulsive gambling and against fraudulent and criminal activities;
- how it will proceed to avoid any conflict of interest; and
- its IT architecture.
The ANJ must respond within four months and may request any additional information and documents from operators while reviewing the application. If the ANJ does not provide an answer within four months, the application will be deemed rejected.18
Licence fees vary depending on the number of applications (€5,000 for a single application, €8,000 for two applications and €10,000 for three applications). In addition to this initial application fee, operators must also pay an annual fee of €20,000 for a single licence, €30,000 for two licences and €40,000 for three licences.
ii Sanctions for non-compliance
Illegal online gambling offer
Operating online gambling services targeting French users without a licence can be punished by a fine of up to €90,000 and imprisonment of up to three years. Such sanctions can be increased to €200,000 and seven years where the illegal online gambling offer is made by an organised group.19
Even though foreign-based operators targeting French users could in theory be punished by such sanctions, it is customary that any prosecution is preceded by the ANJ's chair sending a prior formal notice to inform the foreign site of its obligations under French law and requiring that it ceases the activity. The addressee shall submit its observations within five days. Such requests are generally followed by the foreign-based operators, and proceedings very rarely go beyond than this first step.
However, when this period has expired, the ANJ can use its new means of action granted by the Law of 2 March 2022 aiming at democratising sport in France.20 Since March 2022, the ANJ judicial procedure for blocking illegal gambling sites has been replaced by an administrative blocking procedure to fight against illegal gambling sites. The president of the ANJ may now, under the supervision of an administrative judge, order an ISP to block access to sites that offer illegal gambling and sites that advertise unauthorised activities or order that any person operating a search engine to stop referencing these sites.21
In addition, the Minister of the Budget can, upon a proposal from the ANJ, block any movement or transfer of funds from online gambling operators operating without a licence for a renewable period of six months.22
Sanctions applicable to licensed online gambling operators
Licensed online gambling operators can also be punished for failing to comply with their obligations under the Online Gambling Law, which may result in: (1) a warning from the ANJ; (2) a reduction of the duration of their licence (up to one year); (3) a suspension of their licence (up to three months); or (4) a withdrawal of their licence, accompanied by a prohibition from applying for a new licence for up to three years.23
The ANJ may also impose administrative fines, whose amount may vary with the seriousness of the breach, the status of the online gambling operator, the damaged caused by the breach and the benefit derived from this breach. In any event, such sanction cannot exceed 5 per cent of the online gambling operator's turnover in the previous financial year (increased to 10 per cent for repeated breaches). Should a breach occur during the first year of business of an online gambling operator, the sanction shall be capped at €150,000 (or €375,000 for repeated breaches).
Since 1 January 2020, the ANJ has also been able to sanction operators holding exclusive rights (PMU and FDJ) – namely by issuing warnings, suspending the operation of specific games, withdrawal of a director's licence and issuing financial penalties that may not exceed 5 per cent of their turnover.
i Gaming debts
Gaming debts are not actionable. The French Civil Code expressly provides that 'the law does not grant any action for a gaming debt or for the payment of a bet'.24 A player against whom an action for payment of a gambling debt is being brought could, therefore, invoke this gambling exception and attempt to escape payment.
French courts, however, consider that such gambling exception was adopted for the purpose of fighting against illicit gambling offers, and that licensed operators offering licit gambling services should be able to bring payment actions against their customers.25
However, the gambling exception shall be opposable even to licensed operators, where the debt relates to loans knowingly granted for the purpose of financing gambling.
In the event of an unresolved dispute, the gaming ombudsman, which started its activity in September 2019, can be contacted by a player through the platform mediateurdesjeux.fr. According to the gaming ombudsman's first report issued in 2021, complaints mostly concern difficulties encountered by sports betting players over the results or cancellation of bets, welcome offers or betting limits.
ii Pathological gambling
In April 2021, the ANJ published a framework for the prevention of excessive and pathological gambling and the protection of minors. Proposed to the Ministry of Health by the ANJ following discussions with the operators, this reference framework constitutes an instruction manual for the implementation of the new obligations resulting from the reform of gambling initiated pursuant to the Ordinance dated 2 October 2019.26 These new obligations include the following:
- submitting two action plans annually to the ANJ for approval: one to prevent excessive or pathological gambling and one with respect to its promotional strategy;
- strengthening gambling moderation and protection mechanisms; and
- identifying and supporting problem gamblers.
This reference framework has been drawn up to strengthen the prevention of excessive or pathological gambling and, beyond that, the protection of the players. To this end, this framework proposes both:
- a reading grid of the legal framework produced by the regulator; and
- a reservoir of good practices available to operators.
It applies to all gambling operators: operators with exclusive rights (FDJ and PMU), online gambling operators, horse racing companies, casinos and gaming circles. The compliance of operators with these obligations is a central axis of the regulator's action, which intends to reconcile public health requirements and the economic development of a sector built around recreational gambling practices.
iii Anti-money-laundering legislation
Gambling operators are required by law to implement measures permitting the identification of their customers, appoint a representative responsible for reporting any suspicious operation to the French anti-money-laundering authority (TRACFIN), and implement a number of adapted internal controls.27
The internal controls implemented by online gambling operators must comply with the requirements specified by the ANJ.28
On 9 September 2021, the ANJ published a reference framework for the fight against fraud, money laundering and terrorist financing.29 The reference framework presents an operational application of the legal framework to the gambling sector. It replaces the joint guidelines from TRACFIN and ARJEL dated 12 December 2019 for licensed online gambling operators as well as those established by the SCCJ for operators under exclusive rights.
Each year, operators shall submit their anti-fraud, anti-money laundering and anti-terrorist financing action plan to the ANJ for approval. On this occasion, they shall report on the implementation of the previous year's plan.
This framework applies to all gambling operators, with the exception of casinos and gaming circles, which are controlled by the SCCJ.
Online gambling operators are also required to comply with any asset-freezing measures issued by the French authorities over the funds of any concerned individual or legal entity.
iv Match fixing
Since the Law of 2 March 2022, the ANJ has also been responsible for centralising and analysing reports concerning atypical or suspicious bets taken on sports competitions organised or open to betting on French territory with a view, where appropriate, to forwarding them to the judicial authorities. To this end, the law establishes a secure framework to promote the exchange of information within the French platform, but also with other national platforms of the Council of Europe, international sports organisations and transnational police agencies.
Further, betting ban decisions taken by the president of the ANJ now enter into force immediately after their publication and no longer enter into force the day after publication, as was formerly the case. In the event of serious and consistent evidence of manipulation at a sporting event, this new provision gives the ANJ all necessary responsiveness to neutralise suspicious bets before the start of the game.
i Taxation imposed on gambling operators
Diverse forms of taxation and social contributions are imposed on the lottery tickets sold by the FDJ, for a total representing about 25 per cent of their costs.
Casinos are subject to progressive taxation, which varies depending on the total amount of their gross gambling revenue. Gaming clubs are subject to a similar form of taxation. A player's casino gains in excess of €1,500 are subject to 12 per cent taxation, which shall be directly collected by the casino.
Since the vote of the PACTE Act, in 2019, sports betting operators and lottery operators (whether land-based or online) are subject to taxation based on the actual turnover resulting from the difference between the bets made by players and the players' gains as well as a social security contribution; whereas horse-betting operators' and online poker operators' taxation is still based on the total amount of wagers. In addition, a specific tax applies on the commissions earned by French companies on amounts bet on French horse-racing events from abroad.
In addition to the various taxes imposed on the national and local level, each sport betting operator must execute an agreement with the relevant sports federation for the purpose of specifying the cost of the 'betting right' to be paid by the operator to the federation.
ii Taxation imposed on gamblers
As a general principle under French fiscal law, gambling gains are not subject to income tax.30 The interest generated by such gains, however, is subject to such taxation, and winners of important gains could be subject to the French wealth tax, but the law has recently been modified to apply only to real-estate wealth.
Gains earned by professional players that appear to depend more on skill and strategy than on mere chance (notably with the game of poker) shall be filed with the tax authorities as non-commercial profits and are subject to French income tax. For the purpose of the enforcement of such law, any person who earns substantial and regular amounts by playing games, so that such activity could be regarded as professional, shall be considered a professional player.
Advertising and marketing
In addition to the traditional rules applicable to advertising in France, advertisements that relate to gambling are subject to a number of additional specific requirements.
Gambling operators shall refrain from sending any commercial communication to holders of a player account or identified players benefiting from a self-exclusion measure or to former players subject to a voluntary gambling ban.31
Further, any commercial communication in favour of an authorised gambling operator is:
- accompanied by a warning message against excessive or pathological gambling as well as a message referring to the phone helpline for compulsive players;
- prohibited in publications aimed at minors;
- prohibited on audiovisual communication services and in audiovisual communication programmes presented as being aimed at minors;
- prohibited in electronic communication services intended for minors; and
- prohibited in cinemas during the broadcasting of works accessible to minors.
Furthermore, gambling operators may not finance the organisation or sponsor the holding of events specifically aimed at minors.
Also, operators offering online gambling must submit a document presenting their promotional strategy to the ANJ for approval before 30 October each year.32
In February 2022, the ANJ also published guidelines and recommendations aimed at clarifying its interpretation of the existing rules on the content of commercial communications. It also provided recommendations to limit the intensity of advertising pressure on all media channels, including digital platforms, and to strengthen the protection of minors and vulnerable audiences. Among these recommendations, the ANJ emphasised the risky role of influencers and ambassadors, specifically toward minors, and notably urges influencers to get the responsible influence certificate issued by the ARPP and in force since 2021.
The year in review
Within the framework of its control of the activity of licensed operators, the ARJEL had noted that, in its dealings with players, certain operators were relying on clauses or adopting behaviours likely to characterise a violation of certain rules of the Consumer Code to the detriment of players (i.e., unfair clauses and unfair commercial practices). An operator challenged ARJEL's opinion and argued that the Consumer Code was not applicable to the operation of online gambling.
On 18 April 2019, the ARJEL ruled that the Consumer Code was applicable. The decision was not only to confirm the applicability of these rules, but also to warn operators that any breach could trigger prosecution before its sanctions commission.
On 24 March 2021 the Council of State confirmed the ANJ decision.
Three major points are to be noted in this decision, which reinforces the rights of the player/consumer.
First, an operator and a player can respectively be considered as a 'professional' and a 'consumer'. Contracts between players and operators are, therefore, subject to the provisions of the Consumer Code concerning unfair terms and unfair commercial practices.
Second, more generally, the ANJ may sanction any operator that fails to comply with any legislative and regulatory provisions applicable to its activity. An operator who breaches the provisions of the Civil Code or the Criminal Code or any other legislative or regulatory provisions could be prosecuted before the ANJ's Sanctions Committee, if this results in a breach of any one of the objectives that the ANJ must fulfil as part of its statutory role.
Finally, the decision emphasises that the ANJ may – but is never obliged to – make public its interpretation of the law. This information is part of its regulatory role. This reinforces the 'soft law' approach that the ANJ wishes to develop via recommendations to operators for the implementation of the legal framework.
In the wake of the ANJ's guidelines and recommendations on the content of commercial communications published in February 2022, the ANJ is currently reviewing certain commercial communications of gambling operators to assess their compliance with the guidelines.
On 17 March 2022, the ANJ ordered a gambling site to withdraw its commercial advert for not complying with its guidelines. The ANJ ruled that this ad conveyed the wrong message that sports betting can contribute to social success, understood as a social ascent or a change in social status. The operator was granted a month to withdraw its commercial.
This is the first time that the ANJ exercised this power to withdraw a commercial communication. Other sanctions on this ground should follow this year, especially toward influencers and ambassadors that are likely to promote gambling websites (in particular when these sites are not authorised in France).
1 Alexandre Vuchot is managing partner and Cathie-Rosalie Joly is a partner at Bird & Bird AARPI.
2 Article L.320-1 of the HSC.
3 Article L.320-5 of the HSC.
4 Law No. 2022-296 of 2 March 2022 aimed at democratising sport in France.
5 One should be aware of the fact that a casino does exist in Enghein-les-Bains, a small city located less than 15 kilometres away from the centre of Paris. This casino first opened in 1901 and benefited from a specific exemption allowing it to reopen in 1931. This legal exemption still applies today.
6 Law 2017-257 of 28 February 2017 relating to the status of Paris.
7 Article L.321-1 of the Homeland Security Code.
8 Decree No. 2017-914 of 9 May 2017 on casinos installed on board commercial passenger ships flying the French flag.
9 Article L.321-3 of the Homeland Security Code.
10 Decree 2017-1306 relating to the operation of retailers of lottery games, sports betting and horse betting, and to racing companies.
11 Decree 2008-612 relating to the organisation of the central administration of the Ministry of Home Affairs.
12 Decree 85-390 relating to the organisation and operation of sport forecast games.
13 Decrees 2007-728 and 2007-729 of 7 May 2007.
14 The only individuals whose inscription on this list is not voluntary are criminally sentenced individuals, whose inscription has been requested by a judge or people whose conduct is likely to disturb the proper operation and tranquillity of gambling establishments.
15 Order dated 15 July 1947 on the regulation of games in clubs.
16 Order dated 14 May 2007 on the regulation of games in casinos.
17 Article 21 of the Online Gambling Law.
18 Decree 2010-482 dated 12 May 2010.
19 Article 56 of the Online Gambling Law transposed in Article L324-1 of the Homeland Security Code.
20 Law No. 2022-296 of 2 March 2022 aimed at democratising sport in France.
21 Article 61 of the Online Gambling Law.
22 Article L.563-2 of the French Monetary and Financial Code.
23 Article 43 of the Online Gambling Law.
24 Article 1965 of the Civil Code.
25 Decision of the Cour de cassation, mixed chambers, 14 March 1980, 79-90.154.
26 Ordinance No 2019-1015 of 2 October 2019 reforming the regulation of gambling and games of chance.
27 Article L.323–1 et seq. of the HSC.
28 ARJEL Decision 2011-025 dated 24 February 2011.
29 Order of 9 September 2021 defining the reference framework for the fight against fraud, money laundering and terrorist financing.
30 Article 126 of the General Tax Code.
31 Article L320-11 of the Homeland Security Code.
32 Article 6 of Decree No. 2020-1349 of 4 November 2020 on the regulatory procedures of the ANJ.