Opap SA (OPAP), Europe’s biggest listed gambling company, can get an extension of its betting monopoly and a video lottery terminal license after the European Union’s executive said the company agreed to pay “an adequate fee.”
The European Commission today allowed Greece to extend until 2030 Opap’s exclusive rights to operate 13 games of chance and to give the company an exclusive license to operate 35,000 video lottery terminals until 2022. The EU said Opap will pay an adequate fee to get these exclusive rights and “therefore received no undue economic advantage.”
“Greece has cooperated fully with the commission to ensure that Opap will not benefit from any undue financial advantage through the prolongation of its exclusive rights and its license for video lottery terminals,” EU Competition Commissioner Joaquin Almunia said in a statement today. “This allows for a timely privatization of the gambling operator.”
Opap advanced 1.4 percent to 4.31 euros at 4:01 p.m. in Athens. The company said last month the Greek state reached an agreement with the EU competition regulator on taxes on games of chance in the country. From Jan. 1 any winnings from Opap games will be taxed at a flat rate of 10 percent, in line with online betting operators. Greece will receive 30 percent of gross profit from certain games through Oct. 12, 2020, Opap said.
Today’s decision is “not exactly a monopoly extension, they just said there’s no issue concerning state aid,” said a company official, who declined to be identified in line with official policy. “It’s something we expected after the taxation deal, and of course it’s positive for us.”
While today’s decision “was expected,” there might be some concerns, one of which being that “no Internet betting licenses will be awarded to third parties before 2020,” Paris Mantzavras, an analyst at Athens-based Pantelakis Securities, said in a note today.
Another concern will be the outcome of a challenge by Stanleybet International Ltd., William Hill Plc (WMH) and Sportingbet Plc (SBT) at the EU’s highest court, said Mantzavras. An adviser to the EU Court of Justice last month said in a non-binding opinion Opap’s gambling monopoly may be unlawful. A ruling normally follows four to six months later.
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