EU Court of Justice hands down landmark ruling in casino case

March 30, 2016

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The European Union Court of Justice has just handed down a landmark decision in a case pertaining to Hungary’s decision to deprive some 1,200 companies of their businesses, reports Hungarian news site 24.hu. The court’s decision has paved the way for the plaintiffs to sue the Hungarian state for enormous damages.

The court has ruled in favor of Hungary’s former casino owners who were stripped of their businesses within a span of just three days in 2012 when the government introduced its casino law, said István Schreiber, president of the Hungarian Gambling Association.

According to the court’s decision, Hungarian legislators did not provide ample time for the former casino owners to adjust to the new legislation, and the former owners were not compensated for the losses they incurred as a result of legislation.

According to Schreiber, the decision opens the door for former owners in Hungary to sue the Hungarian state for damages.

While the European Union Court of Justice ruled in favor of the plaintiffs, further decisions regarding compensation must be made by the Hungarian courts.

Estimates by the Hungarian Gambling Association place the total damage to former casino owners at around HUF 100 billion (approximately USD 360 million). The Hungarian state might also have to pay further damages for lost profits.

The Hungarian government raised gambling taxes five-fold before banning slot machines with the 2012 casino law revoking slot machine permits with immediate effect.  One year later, the government awarded five gambling concessions to government film commissioner Andy Vajna, one to the president of the Debrecen football club, Gábor Szima, and one to a casino in the city of Sopron purchased by Casino Austria GmbH.  Shortly thereafter, it modified the casino law so that casino concession fees could be deducted from casinos’ taxable income.  The same law denied Hungary’s gambling supervisory agency the authority to inspect the operations of casinos.

Prior to the casino law, Hungary’s casino sector consisted of 1,200 companies operating in 18,000 locations around the country.