Ladies and gentlemen, Let me start by thanking Willem van Oort for inviting me to speak here today and congratulate him with his great sense of timing as this afternoon there will be a vote on ten Parliamentary motions concerning gambling legislation. In my opinion we could expect a majority for the motion concerning the extension of the timeslot for commercials.
The Kansspelautoriteit, or Ksa, aims to be a visible and transparent organisation, so I'm always happy to make use of opportunities like this breakfast meeting here in Amsterdam. I'll be filling you in on the latest developments surrounding the implementation of the Remote Gambling Act, particularly regarding the licence application many of you will be submitting. We aren't just providing this information for your benefit: the Ksa also stands to gain if market parties are well informed of the latest legal developments. The smooth and effective implementation of the new Act is in our interest as much as it is in yours.
This also has a purely practical reason: the Ksa will have to process a flood of licence applications over two periods of six months; close to 200 potential applicants recently signed up to register their interest. While we certainly don't expect that many to apply, we would not be surprised to see more than 100 applications. So, let me assure you: you aren't the only ones who will be affected by the new law, which is also causing quite a stir at the Ksa.
Let me offer a caveat at the start of my speech. I realise you have some very specific questions, which I may not always be able to answer. Let me assure you that's not because I don't want to: In some cases, I unfortunately just don't have the answers for you yet. For example, we can't formulate the final licence conditions until all subordinate legislation has been finalised. Subordinate legislation serves to flesh out the details of a new law, which involves elaborating certain aspects, filling in details, and generally crossing T's and dotting I's. However, these details are often crucial when formulating licensing conditions. There's no point in us telling you to do things a certain way now, only to change our minds later on.
We are also dependent on political decision-making in certain areas, making it even more difficult to answer some of your questions. For example, I am sure you are eager to know how the six-month delay of the Remote Gambling Act's introduction will affect the Postema motion. As things stand, the Act will be introduced on 1 January 2021 rather than our original target date of 1 July 2020. Online gambling operation licences can be applied for as soon as the new law has entered into force. The online gambling market will then open up six months later. The Postema motion aims to ensure that operators who have not behaved properly are at a disadvantage when the market opens up. Members of the House of Representatives asked Minister Dekker the same question during a committee meeting in late November: how will this six-month delay affect the Postema motion? The minister told them he would discuss the matter with the Ksa, but made it clear that the motion should not become a mere formality. The Minister has not consulted with the Ksa yet, so I am still unable to provide any clarity on the issue.
So, what can I tell you about the licensing procedure? The Netherlands is one of the last EU members to legalise online gambling, which means that you will have probably already gone through similar procedures in other countries. Still, there will inevitably be certain differences. As you know, each country has its own gambling laws. The EU felt harmonisation at European level would be too challenging in view of the major cultural differences. It took the Netherlands so long to regulate the online market because we have such divided opinions on the issue of gambling. This drawn-out national debate ultimately resulted in a thorough, meticulously detailed law. Dutch legislation on aspects such as addiction prevention is more extensive compared to the laws in other countries. As a result, we may ultimately end up having the world's strictest addiction prevention policies. You may be wondering, what sort of information will we be asking you to provide in this area? Among other aspects, we will want to know:
What efforts are you making to protect players from excessive participation and gambling addiction;
What additional measures are you taking to protect the 18-25 age group;
What steps have you taken to embed prevention in your operational management and organisational culture;
What are you doing to make sure your management staff and employees have sufficient training, knowledge, expertise and skills.
You will have to demonstrate that all these requirements have been met to qualify for a licence. And let me assure you: we will definitely find out if your measures only exist on paper.
The Netherlands also has stricter measures regarding advertising. As you can imagine, Dutch legislators took note when things went wrong in other countries. Belgium and Italy would be good cases in point: the latter country even introduced a blanket ban on gambling adverts as a result of the issues. As we clearly saw in the House of Representatives three weeks ago , the Netherlands is determined to avoid these problems from occurring here. This means that we will be asking licence applicants to explain the following:
How have the various responsibilities been assigned;
What measures will you be taking to avoid misleading or aggressive advertising;
How will you make sure players are not incentivised to gamble excessively;
How will you ensure your advertising does not target vulnerable groups;
How will you be applying player bonuses.
As said before, we won't accept situations that merely look good on paper. We will be assessing your actual policies and making sure they are implemented in practice. For example: does your company have a compliance department that assesses whether each advertising campaign complies with Dutch legislation and regulations?
When it comes to assessing the reality behind your situation on paper, we won't be limiting our focus to advertising and addiction prevention. For example, we will be evaluating your reliability, your integrity policies, the financial continuity of your business, the separation of player credits, your age verification procedures and so on. We want to know exactly who we're dealing with before we issue an online gambling license; promises and words alone simply won't cut it. After all, gambling is a high-risk activity. The legalisation of online gambling is currently the subject of much political scrutiny; many of our politicians will be following the process with a discerning and even suspicious eye. As you would expect, the Ksa will be extremely critical in assessing licence applications. In other words: please don't underestimate the procedures we are about to introduce.
As Willem informed me, there are still some questions about the Central exclusion register (Cruks) and the Data safe we expect every online operator to establish. Most of these questions concern the technological side of things. I understand why this is the case and can tell you that we're working on it. We will hold information meetings in the first half of 2020 to keep you updated on all IT-related issues. That's all I can offer for now; a firm commitment to provide timely updates on the exclusion register and control Datasafe.
I also understand there are some questions about our recent announcement that Ksa will be conducting additional age verification starting from 1 January. As I'm sure you are aware, a watertight age verification access system will be absolutely crucial for obtaining your license. We will start monitoring age verification next month. It has become clear that players' ages are often not checked in any way when creating a player account. This is highly worrying and unacceptable, and has rightly been a major talking point in politics. After all, this is a very serious issue. If we find that no measures have been taken by 1 January 2020, you can definitely expect to face repercussions. Let me be clear: the online targeting of Dutch consumers is illegal under any circumstances until the Remote Gambling Act enters into force. The targeting of minors is even more illegal, so to speak.
In other words, don't target Dutch consumers, and certainly don't target minors. In addition to new players, you may be wondering about the age verification procedures for your existing player database. As I expect you will have heard, a certain Dutch licensee will be applying IDIN verification to screen both new players and its existing player database. I highly recommend that you do the same. Operators that fail to follow suit may well end up facing consequences in the short or long term. That concludes my speech on licensing under the new law.
Finally, I would like to talk about the period following enactment of the Remote Gambling Act. What steps will we be taking to push any remaining illegal operators out of the market? As you know, the act was designed to ensure an 80% channelling rate. In other words: 8 out of 10 online players will soon be gambling through a legal operator in a safe and controlled environment. We will be working hard to take on illegal operators, which we also view as our obligation to future licensees.
After all, these licensees will be expected to meet strict requirements: it wouldn’t be fair to subject them to close scrutiny while letting illegal operators do as they please. Effective market regulation also requires active efforts to combat illegal activity. Thankfully, the legislator also acknowledges this reality, and will be assigning the Ksa additional powers.
Unlike the current law, the new Act explicitly grants Ksa the authority to use Mystery Shopping in the fight against illegal operators. In another crucial new expansion of our powers, Ksa will be granted the authority to issue binding instructions to parties that facilitate illegal online gambling. For example, we can demand that payment service providers working on behalf of illegal online gambling sites immediately stop doing so: no pay, no play. At present, we can only politely ask them to stop providing these services.
In conclusion, ladies and gentlemen: I hope I have given you some insight into the Ksa's priorities for 2020. One thing is certain: we've got our work cut out for us. I'm sure the same applies to you! I will be taking part in the panel debate later on, so I assume you'll get an opportunity to ask me some questions you may still have.