Unibet further delays French re-entry
CEO Henrik Tjarnstrom blames tax rate reform delay for setback, while operator association proposes changes "to give the legal market a chance."
Unibet chief Henrik Tjarnstrom has blasted the French government’s decision not to reform egaming tax rates this year, and confirmed this has further delayed its re-entry to the market.
French budget minister François Baroin announced last week that there will be no revision of tax rates ahead of the 2012 elections to be held in May next year.
Tjarnstrom, whose company has yet to enter the regulated market despite being licensed for poker, sports betting and pari-mutuel horse race betting (via a partnership with Zeturf), told eGaming Review that: “As we said in the communication around our Q4s in February, we apply for licences based on profitability, and France does not look good. We have many things we can put our resources into from a development point of view, and unless terms and conditions improve there, we can’t make any money. The opening is looking like a failure.
“We have the licence, it is about allocating the development resources towards prioritising this and launching there. We said in our February Q4 update that this would be the end of Q2, but this will now be later in the year.”
Private online operators such as BetClic Everest, Bwin, Zeturf and Chiligaming have consistently argued that the current tax system makes it impossible to make a profit and to offer a competitive enough offering to bring players and within the regulated regime.
The French online operators’ representative body, L’Association Française du Jeu en Ligne (AFJEL), yesterday announced its formation (replacing AFOJEL) and said it would seek to inform a government review of the regulatory framework, and expedite the changes necessary “to give the legal market a chance.”
BetClic Everest and AFJEL president Nicolas Beraud said yesterday the organisation had “proposed three measures to make the legal offer more attractive and competitive for players”: to replace the existing turnover tax with a gross profit tax; the regulation of online casino; and the full separation of online and offline activities and brands. The latter proposal is aimed at allowing private operators to compete on a fair basis with former monopolies PMU and FDJ.
The European Commission in January expressed “serious doubts” that the online tax regime combined with the monopoly and lower tax on land-based products enjoyed by PMU is compatible with EU law, amounting to an illegal form of State Aid for the country’s racing industry. The French Competition Commission has also voiced similar concerns.