Draft Bill to amend the Spanish Gambling Act and doubts on the constitutionality of the text
Published on 22nd Sep 2022
While the Draft Bill to amend the current Spanish Gambling Act is still in process, the Spanish Supreme Court is seeking clarification regarding the constitutionality of the current Spanish Gambling Act before the Spanish Constitutional Court, specifically regarding its provision enabling regulatory developments in gambling advertising matters.
Law 13/2011, of 27 May 2011, on the regulation of gambling (the "Spanish Gambling Act") applies to the offering of gambling via interactive means, i.e. online gambling. Gambling operators must hold an enabling title (i.e. a license or an authorisation) to carry out gambling activities. The relevant license or authorisation may contain, among other aspects, the conditions under which advertising and sponsorship of gambling activities may be carried out.
Gambling advertising and sponsorship is generally prohibited under the Spanish Gambling Act. However, duly enabled gambling operators may engage in such activities, subject to certain conditions and restrictions. The Spanish Gambling Act does not develop the specific restrictions and conditions applicable to advertising activities, but it sets out that these restrictions and conditions shall be determined by means of a different kind of regulation -with less legal force than an actual "Law"- known as "Royal Decree".
In this sense, Royal Decree 958/2020, of 3 November 2020 ("RD 958/2020"), on gambling advertising activities, regulates the conditions and restrictions on Gambling advertising and sponsorship that gambling operators must observe when advertising games of chance.
Amendment to the Spanish Gambling Act
The Draft Bill to amend the current Spanish Gambling Act which is being processed at present (the "Draft Bill") envisages relevant changes in relation to gambling advertising activities. On 15 September, the House of Representatives in its Plenary Session approved the latest proposals of the Health and Consumer Affairs Commission on the Draft Bill and the text will continue its parliamentary procedure before the Senate.
One of the main proposals was the inclusion of a whole new provision with the following heading "General principles for the advertising, promotion and sponsorship of gambling activities". The new provision of the Draft Bill develops the principle of social responsibility in the context of gambling advertising. The provision lists commercial communications that -by their nature- would infringe the principle of social responsibility and, thus, would be prohibited.
Although the provision is certainly a novelty in the current Spanish Gambling Act (since the principle of social responsibility was not included in it), we note that the Draft Bill mainly reflects some of the provisions of the RD 958/2020 with little-to-no alteration, thus providing the principle with the legal force of an actual "Law" under Spanish law. In this sense, the social responsibility principle incorporates various general principles that should be observed by any gambling commercial communication (e.g. principle of identification, truthfulness and of safe gambling), which calls for operators to comply with specific conditions and obligations when conducting gambling advertising activities.
Furthermore, the proposal from Commission also includes a request for the Spanish Government to develop guidelines to ensure a safer use of non-fungible tokens, loot-boxes, or monetisation mechanics of user participation in video games, including the development of a commercial communications regime regarding such products.
While the Draft Bill is still following the relevant parliamentary procedure, the Supreme Court has filed an appeal before the Spanish Constitutional Court to seek clarification regarding the constitutionality of the current Spanish Gambling Act. In Spain, this type of appeal is known as a question of unconstitutionality.
Following the Spanish Digital Gambling Association's claim against the RD 958/2020 and the intervening parties' allegations, the Supreme Court will consult the Constitutional Court as to whether Article 7(2) of the Spanish Gambling Act is (or not) constitutional. As anticipated above, Article 7(2) is the provision of the Spanish Gambling Act that foresees the development of the conditions and restrictions on gambling advertising and sponsorship by means of a "Royal Decree". The Supreme Court has considered that Article 7(2) could be infringing (due to its generic wording) the principle of reserve of law in relation to the freedom to conduct a business. By way of background, under Spanish law, the reserve of law principle implies that provisions that undermine the freedom to conduct a business should be adopted by an actual "Law" (instead of "Royal Decrees", for instance). For this reason, the Spanish Supreme Court has filed a question of unconstitutionality before the Constitutional Court.
If the Constitutional Court considers that the Supreme Court's concerns are well-founded and finally declares Article 7(2) unconstitutional, RD 958/2020 would be null and void.
RD 958/2020 being null and void would mean, in practice, that the obligations and restrictions on gambling advertising, such as, for example, restrictions on broadcasting via video sharing platforms, limitations on communications on social networks dedicated to gambling or on tipsters' activities, or the prohibition on using public figures in commercial communications, would no longer apply.
However, it should be borne in mind that some obligations contained in RD 958/2020 have been incorporated into the recently approved Law 13/2022, of 7 July, on General Audiovisual Communication and, therefore, would remain applicable even if the obligations of RD 958/2020 were unenforceable.
Likewise, the obligations and restrictions derived from the principle of social responsibility in gambling advertising, included in the Draft Bill, must be observed, should the Draft Bill be enacted.
Since the Draft Bill has not been enacted yet, it is possible that amendments to the text may be introduced during its debate in the Senate. If the Constitutional Court were to declare the unconstitutionality of Article 7(2) before the debate in the Senate finalises, the door to amend Article 7(2) would still be open and, thus, the Government could potentially have sufficient grounds to draft a new Royal Decree on gambling advertising activities.