Czech regulator adds loss limits to growing gambling restrictions

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The Czech Ministry of Finance has issued guidance on maximum hourly losses, which will restrict gambling offers by licensed operators, both online and land-based, with immediate effect.

The guidance, first published last Friday, sets out a mathematical formula that operators must apply to determine maximum hourly losses by taking into account maximum stakes, maximum games per hour and payout rates.

Jan Kozubek, gambling law expert at Becker & Poliakoff in Prague, told GamblingCompliance: “Although the Gambling Act doesn’t explicitly state that a game must be interrupted after reaching maximum hourly loss limit, this fact can be deduced from the requirement that loss must not exceed the amount of the maximum hourly loss.”

The guidance states that operators are “obliged to prevent [a player] from further participation in the […] game”, once the loss limits have been reached.

“It is undeniable that the maximum hourly loss will have a practical impact both for the players, the operators and also providers of software and hardware,” said Kozubek.

The ministry said it considers maximum hourly losses to be an important technical measure in protecting players. Other similar measures in the Czech Republic include enforced breaks between games, maximum stakes and allowing players to set individual limits for their gambling activities.

Kozubek said: “The purpose of implementing maximum hourly loss in the Gambling Act is an effort to protect players from side effects of gambling. Maximum hourly loss may be considered as a similar institute as self-restricting measures or obligatory pause after 120 minutes of playing.”

The guidance is intended to clarify ambiguous provisions in the new gambling act that entered into force on January 1, 2017. As the legislation is already in force, it is understood that operators will need to implement the restrictions without delay.

According to the guidance, when operators offer a number of games, a single loss limit will apply across all games offered on the same channel, meaning operators will need to establish one loss limit applicable to the games they offer online while a different limit may apply for all games offered, even by the same operator, in a land-based casino or slot hall.

Operators should take into account the interruption of a game by the player and calculate and apply loss limits to any games they may offer in foreign currencies.

For games offered online, operators will have to display the maximum hourly loss rate on the website.

The requirements are likely to be felt more strongly by the land-based sector, which comprises a number of local players, as the hardware and software costs of updating machines to comply with the new legislation will be more costly.

The Czech legal online market is still made up of just five licensed online operators, with PokerStars the only international player.

For international operators still eyeing an online gambling licence in the Czech Republic, the restrictions are unlikely to add to the attractiveness of the local market.

A Czech media report recently opined that the new licensing regime had failed to attract a sufficient amount of operators and that a black market was on the rise, prompting the Ministry of Finance to defend its gambling policy in a press release.

Meanwhile, the ministry recently added the first unlicensed operator, 1xbet, to its blacklist.

Source: GamblingCompiliance

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