Austria to establish new gambling regulator

Gernot Blümel, Austria’s finance minister, has called for the creation of an independent gambling regulator, who will take responsibility for market regulation from the country’s Treasury.

While speaking on Austrian television over the weekend, Blümel said he wanted to “untangle” multiple functions currently held within the Treasury. “Therefore, the areas of licensing and supervision should be outsourced to an independent gaming authority,” he said.

The minister was discussing the current state of affairs at Casinos Austria, the country’s gambling monopoly, which has been plagued by scandal in recent times.

Accusations made in relation to the betting operator’s appointment as the chief financial officer of Peter Sidlo, a Freedom Party of Austria (FPÖ) district councillor in Vienna, suggest that the move was designed to ensure that Novomatic could secure political favours from the party.

As per the whistleblowers, Novomatic, which held a 17.19% stake in Casinos Austria, was planning to secure a casino licence in Vienna. This would have essentially scrapped Casinos Austria’s monopoly. All associated parties have firmly denied the allegations.

In the wake of the scandal, Novomatic agreed to sell its share to Czech gaming conglomerate Sazka Group, which already holds a stake of almost 38% in Casinos Austria. Both companies stated that sharing joint control between the parties had not produced the anticipated results.

The deal would give Sazka a sizable majority, ahead of Austrian state public investment body Österreichische Beteiligungs (ÖBAG), which retains a share of around 33%. While Sazka has promised to ensure ÖBAG will be represented on Casinos Austria’s executive and supervisory boards, the transaction has led to concerns that this may lead to loss of jobs and tax revenue.

While speaking with political discussion show Press Hour, Blümel mentioned he was aiming to negotiate an “Austria package” for the business, via ÖBAG, and secure commitments from Sazka to maintain its presence and staff numbers in the country.

“Casinos Austria is a traditional company in Austria that provides over 3,000 jobs. It is important to me that things settle down and that jobs, its location and tax revenue remain secure”, he explained.

He added, “ÖBAG will, therefore, examine how best to ensure such an ‘Austria package’.”

Blümel’s intervention comes after the Österreichische Vereinigung für Wetten und Glücksspiel (ÖVWG), the Austrian gambling trade association, called for an end to Casinos Austria’s monopoly, in the wake of the Sidlo allegations.

At the time, the association had said the claims showed an urgent need for a “rethink” of the current monopoly framework.

Casinos Austria has been maintaining its monopoly since 2016, when licenses of three other providers were revoked.