The Netherlands Gaming Authority published the Supervisory Agenda 2019. In this document, the agency outlined the problems they are facing as a regulator and possible ways to tackle them.

Among other things, NGA mentioned the fact that fining illegal operators doesn’t seem to work. The idea behind fines is simple: you disincentivize an abusive operator. If they have to pay handsomely for breaking a rule, they might as well follow it.

However, it is not as easy when we are talking about the Internet. In many cases, illegal operators were not cooperative. They are registered abroad and simply refuse to pay the fine.

There is no easy way of getting that money from them. The founders are most likely to be hidden behind a network of fake companies and have no intention of giving their money away without a fight.

So many fines remain words on paper. They have to be paid, but there is no way of making the perpetrators do that.

The regulators promise to keep looking for more innovative ways of reducing illegal online operators’ share on the market. It is unclear what these ways are going to be, and how much of taxpayers’ money is it going to take.

One Dutch legal firm claims that these complaints are specifically designed to put pressure on the government. NGA claims it’s a necessity to make new legal tools for fighting illegal operators and may be pressuring the parliament into voting for them.

It is unclear, what these tools are, but it’s hard to imagine a good regulation tool that would not infringe on Internet freedom.

While these new tools named “innovative” by the regulators are not voted into power, the authorities may want to focus their attention on the intermediaries. Affiliates and payment providers may come under scrutiny since the government can’t get the real perpetrators of the law. Payment providers registered in the Netherlands may expect heavier fines for working with illegal establishments.

All of that comes hand in hand with the ineffective practice of fining operators. It may be ineffective, but NGA will lose its face if it stops fining them. Now it’s a question of what’s right rather than what works.

How this may play out

Netherlands Gaming Authority is charged towards preventing illegal operators from entering the market. Here are a couple of scenarios that they may want to implement.

Pressure on intermediaries

The government may want to get the ones they can lay their hands to. The group that should worry the most is Netherland-based payment providers. Regulators may issue a law that would fine those providers that – knowingly or not – work with illegal gambling operators. This means more KYC for new clients and fewer profits as a result.

Internet censorship

The worst case scenario is that the government will resort to Internet censorship to control the market. Sure, banning questionable gambling providers from the web entirely is a good thing.

However, the broader implications of this step are serious. Tools that allow blocking websites from being on the web are going to be abused sooner or later.

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