Gaming regulation in Switzerland

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A revision of Switzerland’s Constitution in March 2012 triggered a new debate on online gambling in the country. Switzerland might very well be the next attractive online gambling market on the European continent as the Federal Council seems aware of the need of a commercially viable legal offer to efficiently fight against the black market. How Switzerland plans to achieve its plans shall be outlined in the coming months, but this article already reveals a few guidelines.

ATTRACTIVE SWITZERLAND


A revision of Switzerland’s Constitution in March 2012 triggered a new debate on online gambling in the country.


So far, gambling through the use of telecommunications is prohibited; online casinos, gaming halls and betting sites being strictly banned by the Federal Office of Justice. Only lotteries may be offered online provided they are duly authorised at cantonal level. To the best of our knowledge, authorised lotteries merely include the two state-owned companies Swisslos and the Loterie Romande.
The current Swiss gaming legislation encompasses the regulation of lotteries, betting and gambling establishments and mainly falls within the competence of the Confederation (art. 106, al. 1, Constitution).

Two specific Acts were adopted on these grounds :


–    The 1923 Act on lotteries and professional bets (LLP);
–    The Act on games of chance and gambling establishments (LMJ), revised in 1998.


First guidelines for Switzerland’s plans to achieve a unified, coherent and effective online gambling legislation were officially revealed by the Federal Council this week on the grounds of a preliminary report from the Swiss Federal Gaming Board in 2009.


A new independent experts agency shall be incorporated to fight against addiction and focus mainly on preventive measures. The declared purpose of the regulation is indeed to prevent illegal gambling and to stop gambling revenues from leaving the country, thereby benefitting foreign operators instead of Swiss cultural, social or sports projects. Switzerland is therefore well aware of the fact that the fight against the black market can only won through the implementation of an attractive and commercially viable legal market.
According to the Federal Department of Justice one of the major proposals of the bill would be to remove all professional gains/winnings from income tax, while currently only winners of casino games are not subject to taxation.


Putting an end to this inequality will result in a loss of tax income, which the State believes to be compensated by the new revenues generated by the opening of an attractive online market.
Details on operators’ taxation are still to be worked out.


For the time being, the Federal Council revealed in its press statement of 13 February 2013 that there shall be an equivalence between online and offline gambling as to rules, criteria and general philosophy to be applied in terms of safety, protection of minors and fight against addiction.


Whether the granting of online licences was to be linked to land-based exploitation, as in the case of other countries relying on a principle of equivalence between online and offline (such as Belgium) was not specified. No indications of such offline requirement have been issued.


A first draft of the new legislation is expected before the end of 2013. It shall then be open to consultation before it can be enacted by Parliament.

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