Islj 2009 3-4 - TMC Asser Instituut

Article 4 of the Act No. 401/1989 provides criminal sanctions in cases
of:
Illegal exercise of the game “lotto” and the other games controlled
by the State or granter societies;
Illegal exercises of the games controlled by CONI and/or UNIRE;
Illegal exercises of other examples of betting in relation to human
beings and/or animals.
Article 4, co. 4 bis, imposes criminal sanctions on anyone who exercises,
controls and manages betting without the public and specific authorisation
whether the said person is Italian or otherwise. In essence, this
law places betting games under the control and direction of the Italian
State.
For this specific reason, Italian legislation has been heavily criticised
by the European Court of Justice which has on occasion declared that
it violates Articles 43 EC and 49 EC (the “Gambelli” 6 and “Placanica” 7
judgements). In the eyes of the European Court of Justice, the criminal
penalties imposed by the Italian laws and the overall restrictions
directed towards the foreign betting agencies, go against the freedom
of establishment and provision of services. According to the ECJ, the
Italian state may control betting activities but it cannot at the same
time retain a monopoly whereby it is the only institution which provides
and manages betting games.
On the same breath and direction the award No. 284/2007, delivered
by the Italian Constitutional Court; states that Italian judges
shall not apply the national legislation for the reasons mentioned
hereinabove 8 .
3.1. The Piergiorgio Gambelli case
By order dated 30 March 2001, issued by the European Court of
Justice on 22 June 2001, the Tribunale di Ascoli Piceno referred an
issue for the interpretation of Articles 43 and 49 EC to the Court for
a preliminary ruling under article 234 EC.
This issue was raised in criminal proceedings brought against Mr
Gambelli and 137 other defendants, who were accused of having illegally
organised clandestine bets and of being the proprietors of centres
carrying on the activity of collecting and transmitting betting data,
which constitutes an offence of fraud against the State. In particular,
the Public Prosecutor and the investigating judge at the Tribunale di
Fermo established the existence of a complex organisation of Italian
agencies linked through internet to the English bookmaker Stanley
International Betting Ltd (Stanley), established in Liverpool, and to
which company Gambelli and the other defendants belonged to. On
this basis, they were accused of having collaborated in Italy with an
overseas bookmaker in the activity of collecting bets which is normally
reserved by law to the State, thereby infringing Law n. 401/1989.
Such an activity, in the eyes of Italian legislation, was considered as
being incompatible with the monopoly on sporting bets which is
managed by the CONI (Italian National Olympic Committee) and
for this reason it could constitute a criminal offence under article 4 of
Law n. 401/1989.
It is important to underline that the Court has been called to interpret
the compatibility of the Italian criminal legislation regarding betting
games with the European law.
6 ECJ, Judgment of 6 November 2003,
Case C-243/01, Criminal proceedings
against Piergiorgio Gambelli and Others,
ECR 2003, I-13031; see I. Zagato, Caso
Gambelli : la Corte di Giustizia riformula
il proprio giudizio sulla disciplina italiana
in tema di scommesse, in Europa e
diritto privato, 2005, I , 206.
7 ECJ, Judgment of 6 March 2007, Joined
cases C-338/04, C-359/04 and C-360/04,
Criminal proceedings against
Massimiliano Placanica (C-338/04),
Christian Palazzese (C-359/04) and
Angelo Sorricchio (C-360/04), ECR
2007, I-1891.
8 See A. Montagna, La svolta della
Cassazione sulla raccolta di scommesse
ed allibratori esteri, una soluzione possibile,
un pecorso non del tutto condivisibile,
in Cassazione penale, X, 2007, 3653.
9 ECJ, C-243/01 paragraph 46.
10 See Case C-384/93 Alpine Investments,
paragraph 22.
11 This law provided for imprisonment for
a period of between 6 months and 3
years.
12 Article 88 if the Italian Royal Decree
required No 773 required applications to
be filed before the Italian policefor
licensing and authorisation to carry out
betting activities.
In the eyes of the European the Court, the Italian legislation was held
to constitute a restriction on the freedom of establishment, which
includes restrictions on the setting up of agencies, branches or subsidiaries,
prohibited by Article 43 EC. In particular, the court emphasised
that “where a company established in a Member State (such as
Stanley) pursues the activity of collecting bets through the intermediary of
an organisation of agencies established in another Member State (such as
the defendants in the main proceedings), any restrictions on the activities
of those agencies constitute obstacles to the freedom of establishment 9 ”.
Furthermore, the Italian legislation constitutes a restriction on the
freedom to provide services. Article 49 EC prohibits restriction on
freedom to provide services within the Community for nationals of
Member States who are established in a Member State other than the
State of the person for whom the services are intended. However,
Article 49 EC “covers services which the provider offers by telephone to
potential recipients established in other Member States and provides
without moving from the Member State in which he is established” 10 .
In light of these considerations, the Court stated that: “National
legislation which prohibits on pain of criminal penalties the pursuit
of the activities of collecting, taking, booking and forwarding offers
of bets, in particular on sporting events, without a licence or authorisation
from the Member State concerned constitutes a restriction on
freedom of establishment and the freedom to provide services provided
for in Articles 43 EC and 49 EC respectively, which, to be justified,
must be based on imperative requirements in the general interest, be
suitable for achieving the objective which they pursue and not go
beyond what is necessary in order to attain it and be applied without
discrimination. In that connection, it is for the national court to
determine whether such legislation, taking account of the detailed
rules for its application, actually serves the aims which might justify
it, and whether the restrictions it imposes are disproportionate in the
light of those objectives.
In particular, in so far as the authorities of a Member State incite
and encourage consumers to participate in lotteries, games of chance
and betting to the financial benefit of the public purse, the authorities
of that State cannot invoke public order concerns relating to the
need to reduce opportunities for betting in order to justify measures
such as those at issue in the main proceedings. Furthermore, where a
criminal penalty was imposed on any person who from his home in a
Member State connects by internet to a bookmaker established in
another Member State the national court must consider whether this
constitutes a disproportionate penalty”.
This position had been previously confirmed in 2007 in another
criminal case, the “Placanica” judgement, where the Italian legislation
declared beyond any doubt as being incompatible with the European
principles on freedom of establishment and freedom to provide services
within the Community.
3.2. The Massimiliano Placanica case
This issue arose as a result of the decision of Stanley Leisure plc, one
of the biggest bookmakers in the UK to engage in the collection of
bets through the use of Mr Placanica and Mr Sorriccio as their Data
Transmission Centres (or agents) in Italy because the Italian laws on
tendering procedures prohibited companies such as Stanley Leisure
plc from directly engaging in betting games in Italy because Stanley
Leisure plc was part of a group which had been quoted on the Italian
regulated markets.
The central issue in this case concerned whether Mr Placanica, Mr
Palazzese and Mr Sorriccio had violated the Italian criminal laws 11 , in
particular Article 4 (4a) of law No. 401/89 by pursuing the organised
activity of collecting bets without possession of a licence or police
authorisation 12 as required of Italian law through as Stanley Leisure
plc.
The EC was called upon to decide whether these Italian laws were
contrary to Articles 43 EC and 49.
The Court made specific reference to the ruling in Gambelli and
reiterated that where national legislations prohibit on the pain of
criminal penalties, the pursuit of activities in the betting and gaming
sector without a licence or police authorisation issued by the state,
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