Dutch Regulator Kansspelautoriteit Slaps €675,000 Fine on NetX Betting for Operating Without a License
The landscape of online gambling in the Netherlands is undergoing significant scrutiny, and the Kansspelautoriteit (KSA), the country’s gambling regulator, is taking a rigid stance against unlicensed operators. In a recent ruling, KSA has imposed a substantial fine of €675,000 (£561,748/$729,183) on NetX Betting for offering online gambling services through its Pferdewetten.de and Betbird.com websites without the necessary license. This penalty also addresses a controversial policy employed by NetX to penalize inactive players after a stipulated period.
A History of Non-Compliance
The saga began in December 2022 when the KSA launched an investigation into NetX Betting’s operations. Authorities discovered that Dutch players were able to access the Pferdewetten.de website, which offered betting on horse racing and trotting—activities classified as games of chance. Notably, the KSA emphasizes that any such games require a specific license to operate legally within the Netherlands. At that time, Pferdewetten.de claimed to hold a license solely from Malta, rendering its operations in the Netherlands illegal.
Following the initial investigation, KSA conducted a follow-up review in April 2023, only to find that the website was still accessible to Dutch gamblers. This indicated a lack of technical measures on NetX’s part to block access from within the country.
Cease and Desist Orders
As a result of these findings, KSA issued a penalty order to NetX, mandating an immediate cessation of all activities targeting Dutch players. In September 2023, NetX shut down the Pferdewetten.de site. However, a subsequent investigation revealed that players could still circumvent restrictions to access the website, alongside the newly discovered Betbird.com, which also targeted the Dutch market with similar gambling offerings.
This prompted KSA to escalate its actions against NetX, leading to a formal hearing earlier this year.
Controversial Inactivity Fines
During the hearing, NetX attempted to defend its practices, asserting that horse betting should not be subject to the same regulatory challenges as casino gaming. The company contended that technical issues regarding IP blocking were to blame for the continued accessibility of its sites to Dutch players.
Nevertheless, the KSA maintained that NetX had fundamentally violated Dutch law. KSA officials also expressed grave concern over NetX’s policy of imposing fines for user inactivity. According to NetX, players who did not engage with their accounts after 12 months were charged a monthly fee of €5. However, KSA viewed this practice as exploitative, arguing that it unfairly punished players for a lack of participation in products that were already illegal.
Financial Penalties and Justifications
The fine handed down to NetX totals €675,000, broken down into €600,000 for the illegal offering of gambling services in the Netherlands and a further €75,000 attributed to the controversial inactivity fines. This action follows a trend of penalties that KSA has recently issued against other operators, including Winbet and BlokDance, each facing significant fines for similar violations.
Protecting Dutch Players
Michel Groothuizen, KSA chairman, welcomed the ruling, emphasizing the necessity of a robust regulatory framework to protect Dutch players from unregulated operators. He articulated the need for tough repercussions against rule-breakers, stating, “We see that illegal providers often pay little attention to the player and do not comply with a duty of care. The practice of fining inactive players certainly exceeds reasonable bounds."
In conclusion, the KSA’s actions against NetX Betting underline the regulator’s commitment to ensuring a fair and secure online gambling environment in the Netherlands. As the regulatory landscape evolves, operators must pay close attention to compliance to avoid similar repercussions, highlighting the importance of protecting players from exploitative practices and illegal gambling activities.
