NetX Betting Fined €675,000 for Operating Without a License in the Netherlands
The Dutch gambling regulator, Kansspelautoriteit (KSA), has imposed a hefty fine of €675,000 (£561,748/$729,183) on NetX Betting for operating online gambling websites Pferdewetten.de and Betbird.com without the necessary licenses. This decision underscores the KSA’s commitment to enforcing gaming regulations and protecting consumers in a rapidly evolving online gambling landscape.
Background of the Case
The KSA’s scrutiny of NetX Betting dates back to December 2022, when it initiated an investigation into the operator’s activities. This investigation unveiled that Dutch players were able to access and engage with gambling services on the Pferdewetten.de website, which primarily offered betting on horse racing and trotting—activities classified by the KSA as games of chance that require proper licensing in the Netherlands. Despite claiming that it was licensed in Malta, NetX was found operating without the requisite approval to offer its services to Dutch consumers.
Revisiting the case in April 2023 revealed that not only was the website still accessible to Dutch players, but no significant measures were implemented to block access to users in the Netherlands. Consequently, the KSA issued a penalty order, insisting that NetX cease all operations within the confine of Dutch laws. Following this order, NetX complied and shut down its website in September 2023.
However, subsequent investigations revealed that Dutch players could still access Pferdewetten.de and open accounts to gamble. Moreover, the KSA identified that NetX was running an additional site—Betbird.com—that offered similar gambling options. This breach of regulations led to further legal actions initiated by the KSA, culminating in a hearing earlier this year.
Criticism Over "Inactivity" Policies
During the hearing, NetX attempted to defend its practices by presenting documentation asserting that horse betting should not be classified similarly to casino games regarding the categorization of games of chance. They also claimed to have undertaken steps to prevent Dutch users from accessing their sites, citing a technical error in IP blocking as the reason for continuing accessibility.
Despite these arguments, the KSA remained steadfast in its position that NetX’s actions constituted a clear violation of Dutch law. The regulator paid particular attention to a controversial policy by NetX that imposed "inactivity" fees. Specifically, NetX charged a monthly penalty of €5 starting from the 13th month of inactivity, a practice criticized by the KSA as both exploitative and beyond acceptable industry norms. KSA officials argued that penalizing inactive players reflects a disregard for consumer welfare, leading to the final decision to impose a fine.
Breakdown of the Fine
In total, NetX Betting faces a fine of €675,000. Of this sum, €600,000 corresponds to offering unlicensed gambling services to Dutch players, while €75,000 pertains to their controversial inactivity policy. This penalty not only serves as a reprimand to NetX but also as a broader message to other operators about the KSA’s unwavering stance on illegal gambling practices.
KSA’s Commitment to Player Protection
The chairman of the KSA, Michel Groothuizen, welcomed the ruling and emphasized the need for rigorous enforcement to ensure the safety and protection of Dutch players. He pointed out that illegal operators often neglect player welfare and fail to comply with their obligations, which is evidenced by practices such as imposing fines on inactive players.
Groothuizen stated, "If players do not engage with the (illegal) games of chance offered, imposing a fine of €5 per month is completely unacceptable." His remarks highlight the KSA’s commitment to creating a safe and regulated gambling environment in the Netherlands.
Final Thoughts
The KSA’s actions against NetX Betting mark a significant step in the ongoing battle against unregulated gambling in the Netherlands. As online gambling continues to grow in popularity, regulators worldwide must remain vigilant in monitoring operators and ensuring compliance with local laws. By imposing substantial fines and taking a firm stance on illegal practices, the KSA is not only protecting Dutch consumers but also sending a clear message to other operators about the importance of operating within the legal framework.
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