Insight
CZECH REPUBLIC City Legislation
Vojtěch Chloupek, Bird & Bird
A short history of the prohibition of slot machine games in Prague
Kristina Kudelíková, Bird & Bird
Michaela Hermanová, Bird & Bird
Bird & Bird has been operating in the Czech Republic since 2008 and is among the leading international law firms in the country. The Czech team comprises of over 40 multi-lingual professionals and covers various industries from technology, financial services, real estate and gambling.
www.twobirds.com
vojtech.chloupek@
twobirds.com
In the process of preparing the decree banning technical games, several city districts called for an exemption from the ban for specific companies, such as real hotel-type casinos. However, these exemptions were not granted because the City of Prague argued that such an exemption could establish a distortion of competition and Prague could face a fine from the Office for the Protection of Competition.
P108 NEWSWIRE / INTERACTIVE / MARKET DATA
Tis September, the City of Prague adopted a ban on slot machines and video lottery terminals (the so-called technical games). Te ban will take effect from January 1, 2021, although slot machines will not disappear completely for another three years because the licences issued prior to the ban will remain valid until their expiry. In practice, that means Prague should be free of technical games by 2024.
Te ban covers those slot machines and terminals that operate automatically and do not need to be operated by staff. According to a survey carried out by the city of Prague, several operators are already circumventing this rule and masquerading a technical game as a live game by having bar staff nearby.
Currently, both technical and live games are only permitted at specific locations within the city limits. Under the new regulation, it should only be possible to play the so-called live games in Prague. Te aim of the regulation is to further reduce the negative impacts of gambling in the territory of Prague, especially in its most dangerous form, which is considered to be technical gaming.
Unsurprisingly, the proposed ban also has its opponents. Tey argue, in particular, that a general ban on technical games and a general permission for live games (without restriction to specific locations) means that the city would lose ability to control where casinos - even without slot machines - would be established. In addition, they point to the financial
impact the ban will have. Revenues from gambling taxes are a relatively significant part of budget revenues for the city and individual city districts. When the ban is imposed, revenues of the city and the city districts are expected to drop by about €15 million per year by 2024. However, the city has promised to compensate the city districts for the loss of revenue.
Live gaming should remain allowed in city districts that do not have a zero tolerance for gambling, i.e. in 16 city districts out of a total 57 city districts. In the process of preparing the decree banning technical games, several city districts called for an exemption from the ban for specific companies, such as real hotel-type casinos. However, these exemptions were not granted because the City of Prague argued that such an exemption could establish a distortion of competition and Prague could face a fine from the Office for the Protection of Competition.
In the past, several Czech cities have passed decrees banning gambling in their territory. Tey mostly tend to ban gambling across the city with a few targeted
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