The Supreme Administrative Court has ruled on the compatibility of provisions of the Polish Gambling Act with European Union law

The Supreme Administrative Court (hereinafter: NSA), in a number of judgments whose justifications have recently been published (judgment of 19 May 2022, case docket no. II GSK 1828/1, (judgment of 23 June 2022, case docket no. II GSK 1974/18) took a long-awaited stance as to the interpretation of the provisions of the Treaty on the Functioning of the European Union (hereinafter: TFEU), inter alia Article 56, Article 267 TFEU and Article 15f(4) and (6) to (10) of the Polish Act of 19 November 2009 on Gambling (consolidated text Dz. U. – Journal of Laws of 2022, item 888, as amended, hereinafter: the Act), ruling on the compliance of the Polish Act with the provisions of the European Union.

The stance of the NSA was awaited, among other entities, by foreign operators who saw in the judgments of the Supreme Administrative Court the hope for a change in the Act in force in Poland, inter alia, in the provisions regulating the register of domains used to offer gambling games contrary to the Act (hereinafter: the Register).

What did the cases in question involve?

• First of all, it should be pointed out that at the basis of the cases now being decided by the Supreme Administrative Court was an amendment to the Act which entered into force on 1 April 2017. This amendment introduced a state monopoly on gaming on slot machines outside casinos (Article 5(1) of the Act), as well as on the organisation of gambling games over the Internet, with the exception of betting and promotional lotteries (Article 5(1b) of the Act). As of 1 April 2017, an official register of internet domains that illegally offer gambling was introduced, while as of 1 July 2017, telecommunications entrepreneurs are obliged to block such websites and payment service providers are to prevent payments from being made on websites listed in this Register (Articles 15f and 15g of the Act).
• The entry into force of the said changes resulted in the entry into the Registry of domains belonging, inter alia, to foreign operators operating on the European market on the basis of licences issued in other European countries, including Malta.
• Decisions on registration of domains in the Registry were objected to, then complained to the Provincial Administrative Court , and finally to the Supreme Administrative Court , arguing that entries of domains in the Registry should be deleted, also because the law on the basis of which the authority made the entry in the Registry is incompatible with the regulations in force in the EU.
• In these cases, the plaintiffs applied to the CJEU for a preliminary ruling answering specific questions aimed at deciding the compatibility of the Polish Act with the provisions of the Treaty on the Functioning of the European Union.

So what conclusions can be drawn from the recent rulings of the Supreme Administrative Court?

• The SAC considered as untrue the allegation that in the proceeding for registration of a domain in the Registry – a party is deprived of the right to participate in the proceeding, the right to be heard and to present its arguments, or is underinformed regarding the rationale and arguments to support the registration and maintenance of a domain in the Registry.
• The Supreme Administrative Court found that the provisions of the Act governing entry in the Register correspond to the standards of good administration established in the Charter of Fundamental Rights of the European Union.
• In the SAC’s view, the regulation contained in Article 15 f of the Act is not discriminatory and does not conflict with the Treaty principle of freedom to provide services, including the principles of proportionality, consistency and effectiveness. Therefore, the freedom of economic activity in the field of gambling may be subject to more far-reaching restrictions justified by the important public interest referred to in Article 22 of the Constitution
• The Supreme Administrative Court came to the conclusion that in the cases under consideration the prerequisites for initiating the procedure of requesting the CJEU to consider the legal question did not materialise, as, in the Court’s view, a decision on this issue is not necessary for the judgment in the case pending before it.
• The SAC decided that the legal solutions adopted in Poland in no way or to no extent diverge from – and even correspond to – the approach accepted in Luxembourg case law regarding the possibility and admissibility of establishing an exclusivity (monopoly) principle in this scope, consisting, in other words, in granting exclusive rights to operate gambling over the Internet to a single entity that is subject to strict control by the public authorities.

In brief, as ruled by the SAC, the state monopoly on certain gambling games introduced in the 2017 Act and the mechanism for entry into the Register of Prohibited Domains is in line with European Union law and CJEU case law.