Shares in the leading betting companies fell heavily after the French authorities arrested the two chief executives of an Austrian gambling firm, signalling the start of a major French crackdown on online betting. Manfred Bodner and Norbert Teufelberger, the heads of Bwin, were arrested as they unveiled a shirt sponsorship deal for Monaco football club.
advertisementAn officer in the French intelligence service said the authorities had been investigating the company since last year, but said other firms could be under the spotlight too: "Online bets are forbidden in France."
Asked if there would be further arrests at other firms, he said: "Yes, that's a possibility. If we have evidence we will look at them."
His words will send a shudder through the industry, still reeling from the crackdown in the US that has seen two UK executives arrested. Most gaming firms believe that targeting European citizens as clients is legal.
Mr Bodner and Mr Teufelberger, who spent last night in a police station in Nice, will appear in front of a judge tomorrow to hear the charges. The first is, "organising illegal bets online," the second is, "advertising online bets", according to the intelligence service official. He made it clear that all bets, be it for sporting events or for casino games, were illegal, "even if the website is outside of France".
The only two companies exempt from these laws are the state-owned lottery and sporting companies Francaise des Jeux and Pari Mutuel Urbain, he added. he two Austrians were picked up on French soil at Monaco's training ground on the outskirts of Nice.
Partygaming, which recently bought European operator Gamebookers to diversify itself away from the US, saw its shares fall 9½ to 100¾. Gamebookers is the shirt sponsor of Nantes football club, while 888 sponsors Toulouse. Its shares fell 8¼ to 141¾p. Both were adamant that they had done thorough legal checks before entering the French market.
Bwin was dismissive of the French move. Karin Klein, the company's spokesman, said: "Our operations are based on a European-wide licence. We will sue the French authorities because all this is violating European laws. There will be a number of law suits. This is really outrageous."
Bwin's shares were suspended in Vienna. Her comments were echoed by Partygaming, whose spokesman claimed the French authorities were contravening the Treaty of Rome. Torbjörn Ihre, of the European Betting Association, said: "I think it's totally unacceptable. We are going down a route that treats betting executives as terrorists. It's very scary."
Earlier this year the European Commission launched an investigation against seven member states, saying it had grounds to believe the countries were violating the free market principal in their sports betting markets.