June 17, 2018 by

Switzerland Votes to Legalize Online Casinos

Famously conservative Switzerland overwhelmingly approved a referendum that allows online casinos to open for business in the Alpine country.  The law, however, only allows local entrepreneurs to open online casinos, thus shutting out the thousands of well-known and less well known online casinos already in operation in many jurisdictions around the world.  The law specifically designates that only local land based casinos will be awarded licenses to open online casinos.


The Swiss legislature has already passed the law which was sent to a referendum as the final step in the process of legalization of online casino gambling in the country.  The Swiss legislation, and the citizenry in overwhelming numbers, agreed that online casinos are extremely profitable, as they offer a wealth of gaming choices plus, through casino bonuses, they make it easy for gamers to enlarge their bankrolls in order to expedite longer gaming sessions.  The message is that the Swiss people feel that the money gambled at these online casinos should stay in Switzerland.

The legislation was sent to a referendum because the Free Democrat Party got enough signatures on petitions to send it to a referendum.

Certification

The law allows opening online casinos in Switzerland beginning in 2019.  The restriction on outside casinos was sold to the public as a necessary step in the constant battle to contain and ameliorate problem gambling.  It was felt that only strict local control could have the necessary effect on the scourge of problem gambling.

It might be true that local regulation could ease the effect of problem gambling but the more likely purpose was simply to keep Swiss money in Switzerland as much as possible.  This is, of course, a fair decision on the part of both the legislature and the citizens.

Worries about Both Addiction and Lost Taxes

The cat was out of the bag as Swiss Justice Minister, Simonetta Sommaruga, claimed both that local oversight was needed to make sure that Swiss law regarding problem gambling was followed and also that the $250 million francs that Swiss gamblers annually spend at foreign online casinos cannot be taxed locally since they are legally subject to different taxing jurisdictions.

Criticism of the Law

The main opposition to the law as it was presented to the public and as it now stands after 72% voted in favor of it in the referendum, is on four separate levels. 

First, the critics claim that foreign casinos could have been invited to set up shop in Switzerland by simply agreeing to be taxed on money earned in Switzerland. 

Secondly, they claim that the minimum level of casino gambling winnings that will be taxed has been raised to a full million francs as opposed to the previous level of a mere 1000 francs. 

The third criticism is that big money land based casino interests have been behind the legislation and the public campaign leading up to the referendum.  Of course, the big money interests stand to make more money if foreign online casinos are excluded and local entrepreneurs must begin at zero in order to get their casinos on board.

Finally, people in the know about online companies have also said that foreign casinos can easily circumvent the restrictions placed upon them by the law through the use of virtual private networks.  This would be similar to the way some online casinos circumvented a law in the United States that made it illegal to transfer money to an online casino.  Most online casinos eschewed the American market but several found ways to get around the law and have stayed in business since the law was passed in 2006. To this criticism, supporters have said that several jurisdictions around the world have successfully implemented similar regulatory bodies and restrictions.

Young versus Old

Young Swiss people seem to be far more amenable to the broader notion of opening the online casino gaming market to foreigners as well as to locals.  The head of the Green Party’s youth division, Luzian Franzini, said that the law as it stands is a serious step in the direction of online censorship.  He might be thinking about charges in the United States and elsewhere that such online giants as Google and Facebook are already censoring political opinions that they disagree with.

Young Swiss voters are said to fear that by giving the government the ability to block information online, it would quickly move beyond the narrow confines of blocking online casinos from outside Switzerland to blocking opinion it didn’t like.

As liberal as Swiss youth may be with the idea of online gambling, they are still as conservative as their elders when it comes to government power, especially in the highly charged area of internet censorship.

Looking Ahead

With the new law and the overwhelming support from the public, despite the initially strong opposition from the young and the most liberal sector of the Swiss public, the people of Switzerland have made three bold statements seemingly at once.  First, they want Swiss control over online casinos that cater to Swiss citizens.  Second, they want Swiss casino profits to stay in country so they can be taxed to the fullest extent allowed by law.  Third, that they are far less concerned that the Swiss government will suddenly begin censoring political or other information as a result of having been given a somewhat free hand in the narrow area of online casino gambling.

The Swiss people have long been extremely jealous of their hard-earned freedoms so, despite the loss in this referendum, we can expect Swiss citizens of the left to remain vigilant in exposing government censorship wherever it might show up.