Hungary plans to liberalize its sports betting market

According to its recent TRIS notifications (no. 2022/66/HU and 2022/67/HU) addressed to the European Commission, the Hungarian legislator has decided to open the Hungarian online sports betting market to private operators in the near future. This liberalisation, the explicit aim of which is to establish a regime in line with the CJEU’s Unibet (C-49/16) and Sporting Odds (C-3/17) judgments, also means that the respective monopoly of Szerencsejáték Zrt. will cease to exist.

The opportunity to provide online gambling services will be available to operators based in the European Economic Area (EEA), and operators must meet the requirements on the minimum amount of share capital (HUF 1 billion (cca. EUR 2.8 million)) and must have at least 5-year experience in the provision of online sports betting/online casino games. The regulatory power of the president of the Supervisory Authority of Regulatory Affairs (SARA) will be greatly significant, as the president will be entitled to set the maximum duration of licences (the planned maximum is 7 years) and the minimum amount of securities to be provided by gambling operators (HUF 250 million (cca. EUR 700k)) as well as the amount of the license fees (planned: HUF 600 million (cca. EUR 1.7 million)).

The draft also introduces the institution of a player protection action plan, that should be submitted by operators following the implementing rules on content, among others.

The draft legislation does not limit the number of licences that could be granted to operators; however, it excludes operators who have organized gambling in an EEA State without a licence in the period of ten years prior to their application for a licence. Pursuant to the draft, in case if an operator carries out unlicensed gambling services, it shall lose its licence to provide its services to Hungary.

As regards payment service providers, under the draft, deposits may only be placed by transfer from the player’s payment account with an authorized payment service provider, by online credit card with a payment card linked to such an account or (if allowed by the supervisory authority) by sales outlets/betting shops. Payments to players may be made by transfer to the mentioned accounts. The draft regulation stipulates that a company established for the purpose of organizing gambling may have a payment account only if it holds the licence granted by the SARA.

Among some other unusual provisions, it is also a unique feature of the planned regime that the ultimate beneficial owner of the operator must each year be personally present at the Hungarian regulator’s offices and to report about the operator’s annual achievements in the field of responsible gambling.

Importantly, the draft contains no relevant amendments to the online casino games regime, under which only land-based casino concession holders can provide online casino games.

The draft bill is planned to enter into force on 1 January 2023.