Bwin is an internet gambling website with something for everyone. They offer an online sports book, poker room, casino, and games such as bingo, lottery, and hi-lo in twenty different languages. Unfortunately, having a little something for everyone these days means having the ability to piss of a government somewhere around the world. France decided to pull an "American" a week and a half ago and detained Manfred Bodner and Norbert Teufelberger, the two co-chief executives of Bwin, when they were in France. According to the Bwin corporate website, "…the two CEOs responsible for the strategic orientation of the bwin Group were detained in France on Friday, 15 September 2006, for the alleged violation of French gaming law." What I love about all this is how it’s being played out almost like a French film, there's just so much drama. Bwin is almost hysterical with their indignant stance against the French government. "We do not understand the course of action taken by the French authorities. Two irreproachable and highly esteemed CEOs of a company listed on the Vienna Stock Exchange are being treated as criminals. This stands in fundamental contrast to the principle of proportionality, particularly as both the company and the CEOs would have answered any summons issued by the French authorities at any time." I can explain what the issue is here. France may be a democracy but the French are fascists who like to control absolutely everything so that they can make sure everything in France stays French. Fair enough, it's their country and they can do what they like with it. France has a state lottery. Bwin is taking money away from their state lottery because it's easier for someone to play at home then to get up and go to a national run kiosk. It is economic protectionism plane and simple, and the Bwin people know it. "The action taken by individual EU Member States against private competitors who have put the state’s gaming monopoly under pressure is neither new nor is it a surprise. The events in France are unprecedented in their aggressiveness, however. Although the European Court of Justice holds a different legal opinion and the action taken is in clear violation of EU law, sham argument of player protection/addiction are being put forward to maintain the monopoly as long as possible. In response, the EU Commission has already started infringement proceedings against seven Member States." On September 18th the co-CEO's were released. "As announced in a previous ad-hoc release, a preliminary hearing of bwin Co-CEOs Manfred Bodner and Norbert Teufelberger was held yesterday, Monday, 18 September 2006, in Nanterre by the French examining magistrate. After lengthy questioning, the two Co-CEOs were released on bail in the amount of EUR 300,000 each, to be paid personally." "The bail will be used to cover any fines that may be imposed, and to ensure that both Co-CEOs will obey any future summons to appear in court. A verdict is expected within a year. Theoretically the maximum sentence in the event of a conviction would be three years. The Company is working on the assumption that the European Court of Justice will have passed a verdict in the Placanica case before the court in Nanterre passes its judgement, and that the judge in Nanterre will take the ECJ's verdict into account in arriving at a decision." The thing is that France doesn't care about what the EU thinks if it's inconvenient for France. Germany doesn't care what the EU thinks if it's inconvenient for Germany. Italy doesn't care what the EU thinks if it's inconvenient for Italy. Hell, Britain hasn't even switched to the Euro. See a pattern here? For a supposedly United Europe each country individually still does whatever the hell they want. Not exactly convenient for free trade. This should make the fact that Italy and Germany are also outlawing international online gambling no surprise. Italy actually blocks over 600 online gambling establishments via internet service providers. If an ISP doesn't block a blacklisted online casino they will have to pay an insane fine. Malta has tried to fight Italy and their blacklist, but it's fallen on deaf ears. Germany has banned all outside online sports betting, threatening to arrest any executive of an internet gambling establishment entering Germany. According to Michael Ziegler, spokesman for the interior minister of Bavaria, one of three German states which have ordered Bwin to cease operations, “We want to keep the monopoly.” That says it all, really. Why should they share the cash-cow that is internet gambling with an outside competitor? Bwin isn't pleased with any of it. As they are based in Gibraltar, they should be able to operate throughout Europe under EU law. A company lawyer commented, “The freedom of services is a basic foundation of the European Union.” Funny, that's what Malta said to Italy last January. It didn't have much affect. Right now France is only after the executives. According to their website, "No official court proceedings have ever been instituted against the Company to date. bwin has informed the examining magistrate that the Company wishes to take part in the proceedings so as to be able to defend its legal position." While their shares started trading again on the Vienna stock exchange on September 19th, the current proceedings have not gone unnoticed by potential buyers. "Trading of bwin shares was resumed this morning. The drop in the share price has so far been significantly lower than originally anticipated." Ouch. Posted on: September 25, 2006
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