Changing of the guard: how the ANJ has taken up the regulatory standard of the French market

France’s flirtation with online gambling and sports betting began with the passage of a law “on opening the online gambling and betting market to competition and regulation” in May 2010, but has since developed into one of the most stable markets in Europe, thanks to the work of French regulator ARJEL. However, as the market has changed and evolved, so has the need for the regulator to evolve to meet its new market obligations.

As part of this transition, a new French regulator L’autorité nationale des jeux (ANJ) has been constituted, with a wider remit and larger responsibilities than its predecessor. Taking up the baton from long-standing ARJEL CEO Charles Coppolani is ANJ president Isabelle Falque-Pierrotin who discusses these responsibilities with EGR Compliance below.

EGR Compliance: What are the day-to-day duties of your role as president of the ANJ?

Isabelle Falque-Pierrotin (IFP): The central philosophy of the ANJ is structured around four objectives: preventing excessive or pathological gambling and protecting minors, ensuring the integrity, reliability and transparency of gaming, preventing fraud and criminal activities, as well as money laundering and financing of terrorism.

Lastly, the ANJ works to ensure the balanced, fair development of various types of games, in order to avoid any economic destabilisation of the sectors concerned. As chairwoman, I want to give a strategic vision beyond these four objectives. We are finalising a strategic plan which will be the framework of all the ANJ actions for the next three years.

EGR Compliance: Are you new to the gambling industry? If so, what kind of skills/experience are you bringing with you from your previous roles?

IFP: I am quite new to the gambling industry, even though I have been working on developing the structure of the ANJ since October 2019. However, I’ve previously been chairwoman of the French data protection authority (CNIL) for seven years, so I have a strong experience in the regulation field.

EGR Compliance: In what ways is the ANJ different than its predecessor, ARJEL?

IFP: The ANJ follows ARJEL, albeit with a significantly extended regulatory scope and enhanced powers. In its new capacity, the ANJ is now responsible for all components of the legal gambling market, both online and offline.

This includes all the online games that ARJEL previously regulated including sports betting, horseracing betting and poker offered by the 14 licensed operators as well as all games of La Française des Jeux and the PMU proposed in physical points of sale or online. We also have responsibility for 228 racecourses, 202 casinos, apart from anti-money laundering issues and the integrity of the games offered, which remain under the responsibility of the Ministry of Home Affairs.

While ARJEL previously regulated 11% of the French gambling legal market, the ANJ now regulates 78%, which represents a market of more than €50bn (£45bn) in bets.

EGR Compliance: In your opinion did ARJEL succeed or fail in its regulatory objectives?

IFP: In my opinion and based on my observations, ARJEL succeeded in regulating the online market and was a very proactive model which we’re trying to replicate here at the ANJ.

EGR Compliance: How does regulating 78% of the French gambling market increase the regulatory effectiveness of the ANJ?

IFP: With regulation of 78% of the French gambling market, the foundations for a consolidated regulation are now laid to have an overall gambling policy in France under the control of the ANJ. It will be able to implement a complete “toolbox” including preventive, prescriptive and control activities, as well as sanction measures throughout the entire gambling industry.

EGR Compliance: The remaining 22% of the French market is managed by the French government, why was it necessary to make this separation?

IFP: It is the choice of the government to keep the control of casinos regarding money laundering and integrity issues.

EGR Compliance: How do you interact with the French government on a day-to-day basis?

IFP: The ANJ occasionally works with three government departments, which are more or less involved in some parts of the gambling regulation: Ministry of Home Affairs (some casino issues), Ministry of Agriculture (some horserace betting issues) and Budget Secretary (some lottery issues). A “government commissioner” also attends the ANJ board plenary meetings.

EGR Compliance: Could you explain your interpretation as to why it was necessary to form an independent regulatory body?

IFP: Being an independent regulatory body is necessary because two of the online gambling licensed operators, which also have a monopoly on the offline gambling market, are linked to the state: the state holds 20% of the shares of La Française des Jeux (which holds a monopoly on the offline lottery and betting market) and has four seats in the supervisory board of Pari Mutuel Urbain (which holds a monopoly on the offline horserace betting market). The state is therefore an actor in the gambling market and could not become its regulator at the same time. ANJ’s independence from the government was therefore essential.

EGR Compliance: What for you is the biggest lesson you have learned from ARJEL’s track record in regulating the French market?

IFP: I draw two main lessons from the work of ARJEL: firstly, the importance of combatting illegal unlicensed operators and the necessity of constantly increasing and building resources to meet this challenge and secondly having a willingness to aid operators in remaining compliant.

Fighting against illegal operators has been a constant action of ARJEL and has led to many court cases in the French legal system. However, this procedure is very slow and can often prove to be expensive. We need to improve it because a strong framework for dealing with illegal operators is the natural counterpart of higher obligations for the legal ones. We will therefore ask for a legal power to directly block illegal websites via ISP blocking.

Helping the operators to comply is the key mission of the ANJ. ARJEL operated a good relationship with all the online licensed operators and I’m keen to continue this. I want to expand this dialogue with all the actors and to provide them with innovative compliance tools, which is something we are currently working on.

EGR Compliance: Has the French government broadened your regulatory powers enough to achieve ANJ’s regulatory objectives?

IFP: Yes, the ANJ has enhanced powers to fulfil its missions, such as the ability to require the withdrawal of a commercial communication involving an inducement to excessive gambling or the ability to carry out on-site controls. Regarding operators under exclusive rights, it authorises their games offer and it annually approves their games programme, their promotional strategy as well as their action plans in the fight against fraud and money laundering on the one hand, as well as prevention of gambling addiction and the protection of minors on the other hand. In turn, the ANJ will exercise greater control over these operators in these different fields.

EGR Compliance: How would you describe the ANJ’s relationship with French-licensed operators? How have they reacted to the change in regulator?

IFP: Legal operators are competent and reliable interlocutors to the ANJ. We must help them in compliance efforts and provide them with tools to secure their business and foster trust of the consumers. The ANJ must also make clear that the new legal framework must be respected by all the operators both online and offline, which implies a credible and appropriate control strategy.

[quote]The central philosophy of the ANJ is structured around four objectives: preventing excessive or pathological gambling and protecting minors, ensuring the integrity, reliability and transparency of gaming, preventing fraud and criminal activities, as well as money laundering and financing of terrorism[/quote]

EGR Compliance: In what ways do you work to enhance collaboration with operators?

IFP: Regarding operators, the ANJ, as a priority, explains and assists all operators (offline and online) in their ownership of the new and rather complex legal framework. It provides all operators (offline and online) quickly with two essential compliance documents to help setting their practices: the reference framework on the prevention of gambling addiction and the protection of minors and the one on the fight against fraud, money laundering and the financing of terrorism. In addition, the ANJ also encourages and develops participatory methods allowing standards to be drawn up which are as close as possible to sectoral realities and can ultimately be better accepted by operators and are more effective.

EGR Compliance: What would you describe as the cornerstone of the ANJ’s approach to regulating gambling in the French market?

IFP: The cornerstone of the ANJ’s approach to regulating gambling in the French market is allowing for gambling to take place within the sustainable perspective of recreational gambling. To do this, the ANJ will bring together all the players (professionals, researchers, players, administrations, etc.) to bring this model to life, to enrich it thanks to good practices and innovations, and to promote it at European and international level.

EGR Compliance: Where for you are the biggest challenges in taking over the regulation of the French market and how are you addressing them?

IFP: In France, one person out of two is a gambler. Problem gamblers are estimated around 1.2 million. So, preventing excessive or pathological gambling is a public health issue to which I attach the utmost importance. I want to place the players at the heart of the regulation. For that to be real and effective, I want ANJ to be as close as possible to the gambling experience and the uses of the players.

To achieve this, we have three main strategies geared towards players. First, we want to inform them properly on the new legal framework. Historically, we’ve noticed ignorance from the players on it and more generally on the basics of the gambling regulation, therefore the ANJ must be able to provide precise answers and an appropriate guidance whenever necessary. It will carry out communication actions for the general public, whether through the press, its website, its presence on social networks or by providing educational tools. We want to bring editorial content regularly to the public to explain our action.

Secondly, I want to bring new services to the players, for example, an alternative dispute resolution mechanism is offered since September 2019 and we want to develop this mediation service in case of a dispute with an operator. We also want to better empower the player in controlling his/her gambling activities. The ANJ has been in charge of the list of self-excluded players since September 2020, so we will change the process and characteristics of the file in order to ease access to the service as well as make it more practical and simpler for the players.

Finally, I want the ANJ to work more with the current player community, it knows a lot on gambling practices and can help us with regulating and promoting good practices. The ANJ will work to develop a platform to engage with the player community so that they can share experiences, advices and support solutions. This will allow the ANJ to capitalise on the collective knowledge of the players, their knowledge and their gaming practice in order to enrich the regulatory framework.

EGR Compliance: In what ways is the ANJ working with other international regulatory bodies? On what projects?

IFP: Cooperation between international regulators is already well established thanks to the contacts forged by ARJEL with our counterparts, in particular regarding the European coordination of the fight against sports manipulation. The ANJ is now working to strengthen this cooperation, for example, by participating in various international meetings. Also, the ANJ and the Kansspelautoriteit signed a Memorandum of Understanding this last October.

EGR Compliance: How would you describe your approach to enforcing your regulatory objectives? 

IFP: In respect of enforcement, we must professionalise our action in order to be more effective vis-à-vis those who do not respect the legal framework. For example, we have just signed a collaboration agreement with the Police Department “Racing and Gambling Central Service” to pool our skills and in particular to carry out joint controls in casinos or points of sale that register bets or sell lottery or scratching games. This agreement makes it possible to offer a united front and to federate an ecosystem of public regulation.

EGR Compliance: In what ways has the Covid-19 pandemic altered this regulatory handover process? 

IFP: Covid-19 only delayed my hearings at the National Assembly and the Senate, and therefore the launch of the ANJ (which finally took place on Monday 22 June).

EGR Compliance: Has the ANJ seen any evidence of an increase in gambling by French players during the lockdown period?  

IFP: In the second quarter of 2020, the online gambling market recorded a decrease of 6% of its GGR1 and a decrease in active player accounts of 9%. It is the sports betting sector that has been the most affected by the effects of the health crisis with a decrease of 56% of its GGR. Conversely, the poker and, to a lesser extent, horseracing betting segments recorded a sharp increase of their GGR. The lockdown (from 16 March to 10 May) was particularly handicapping for operators, which recorded a decrease of 24% over the period compared to 2019. However, despite this health crisis, the GGR of the legal online market reached €758m over the first six months of the year, an increase of 8% compared to the first half of 2019.

EGR Compliance: Have there been any changes/updates to responsible gambling measures especially during the Covid-19 pandemic to protect vulnerable people?

IFP: Yes, for example, ex-ARJEL disseminated good practices on online poker. Operators also published prevention messages and strengthened their problem gamblers’ tracking systems. More generally, we launched a study with the operators to collect facts and figures on players behaviours during the lockdown, in particular the risks of excessive gambling. We should have the results of the questionnaire very soon.

EGR Compliance: Which international markets do you think serve as potential models for future ANJ regulation and what is it about those markets which makes them so?

IFP: There aren’t really any other regulators we model ourselves on, as each market contains its own regulatory nuances and trying to apply them in France might be inappropriate. We have chosen to develop the French approach along sustainable and ethical lines. We must stick to that, consolidate the French regulation and demonstrate its value to both the operators and the players.

EGR Compliance: What are your objectives for the rest of 2020?

IFP: During the remainder of the year, the ANJ is looking to adopt the reference framework on the prevention of gambling addiction and approve the operators’ action plan on responsible gambling. We are hoping to also increase the effectiveness of the French self-exclusion register. Indeed, the ANJ will propose a new registration process and a real tool for self-protection and control of the game that is faster and less guilt-ridden.

We also looking to take on the regulatory control of the operators holding exclusive rights (La Française des Jeux (for offline sports betting and lottery) and PMU (for horserace betting)). This is a new obligation for these operators and they will work with us for the first time at the end of the year. This programme of works presents the games strategy and contains a description of all the new games and bets that the operators holding exclusive rights intend to operate for the year in question and thereafter, and the conditions for continuing to operate existing games.