Internet Gambling: French High Court gives major victory to Maltese based ZeTurf

Internet Gambling: French High Court gives major victory to Maltese based ZeTurfIn a major victory to internet gamblers in France, le Cour de Cassation (French High Court) ruled that the Parimutel Urbain (PMU) cannot prevent Malta based ZeTurf from offering French horse racing wagers over the internet.

The decision by le Cour de Cassation puts to rest a case that started back in 2005. On 8 July, 2005, the Paris Court of First Instance ruled that it was illegal for ZeTurf to accept wagers from French citizens over the internet, in violation of the monopoly granted to PMU by the French government.

On 6 January, 2006, ZeTurf lost on appeal but the founders of ZeTurf fled Paris to gaming friendly Malta. PMU pursued ZeTurf offshore, however the Maltese courts wanted nothing to do with it and threw the case out on jurisdictional grounds. So the case was back in hands of the French legal system.

Most of the European Union is tolerant to internet gambling, however France has been one of the most opposed countries along with their neighbor Germany. The EU has filed for WTO sanctions against the United States after Washington said it was backing out of its 1994 GATS Treaty commitments for gambling after losing a battle over opening up the American internet gambling market to foreign competition, specifically Antigua & Barbuda. Antigua has asked the United States for $3.4 billion annually in sanctions for Washington’s failure to comply with the World Trade Organizations finally ruling on the matter.

Perhaps the French government should take le Cour de Cassations ruling as a wake up call. The high court noted that under recent Placanica case at the European court of Justice (ECJ), EU countries that operate a government monopoly cannot promote such monopoly to generate revenues for the government while banning foreign competition. France is trying to protect its revenue stream in a similar manner to the United States. Both countries believe that banning certain types of gambling is necessary to protect gamblers from themselves.

Now that France has been shot down at the highest level of their judicial system, the tide seems to be turning for the EU internet gambling industry. Germany remains one lone hold out but their is momentum sweeping across Europe towards liberalization of gambling regulations as the continent continues to push towards borderless market competition between member countries.