“THE BRIBE FOR SURVIVAL!” IS THE GAMBLING INDUSTRY FORCED TO CONTINUE THE TRADITION?
by Lawyer Prof. Marius PANTEA, PhD
Lawyer Prof. Marius PANTEA, PhD
The world was stunned by the statements of former Deputy Prime Minister Dragos Anastasiu, who dared to admit from the government podium that he had paid bribes. As in many situations, there are two types of people in this world, those who admit and those who do not. “Let him who is without sin among you be the first to throw a stone at her” sounds like a famous quote, which fits the situation perfectly. The aforementioned character self-imposed the punishment for bribery over a period of eight years, by resigning from his political position. Whether we agree with what has been said or find it appalling, it seems that the government led by Ilie Bolojan will continue the tradition, at least as far as the national gambling industry is concerned. Why do we believe this? We will explain below.
After the famous package of measures no. 1, which gave our gambling industry another “boost” (increasing the taxes that gambling operators have to pay to the state budget, and those that players have to bear), a new proposal called “reform package 2” was thrown onto the market, offering a poisoned gift to mayors (after their access to the toy called the “Anghel Saligny National Investment Program” was drastically limited), namely the right to allow or prohibit the operation of gambling within their jurisdiction (with the exception of local administrative units with fewer than 15,000 inhabitants, which, thanks to clever previous amendments, no longer allow it “de jure”).
Without consulting businesspeople in the gambling industry, whom the ONJN president resignedly informed at the last Advisory Council meeting (which I had the honour of attending and which resembled more a “memorial service” for the industry than a dialogue between people with ideas, opinions, and solutions with the authority that should take into account the market and reality) about the changes that came into force on the 1st of August, and a little about what will follow. The latest proposals were put on the table with no hope that they could be amended because “political will” is stronger than reality and than the constitution, the laws in force, and European regulations.
The provision in question will amend the framework law on gambling in the sense that: “the licensed gambling operator is the gambling organizer, i.e., the legal entity that has obtained a gambling license, a gambling operating license from the Supervisory Committee of the National Gambling Office, as well as a local operating license from the local public administration authority in whose jurisdiction it operates” based on an annual fee called “local authorization fee, established by the local council” and only if “the proposed premises are authorized by the local public administration authority, based on the policy established by the local council”. All this must happen within an unrealistically short time, namely “within 6 months of the date of entry into force” of the future amendment contained in the famous package, and in this regard, all operators “carrying out activities in locations within the territory of an administrative-territorial unit are required to obtain a local operating license”.
It does not matter that there are already valid permits, paid in advance (some of them a year in advance), it does not matter that there are lucrative facilities registered with the ONRC, and rental contracts for these premises, with clauses containing penalties that will have to be borne by gambling operators, and in fact nothing matters anymore, the most important thing, and the thing that will solve the major budget crisis we are going through, will be “the agreement that the mayors will give for slot machines.” And so, the prime minister is fooling the mayors and the European Commission, and the ordinary citizen too who will be protected from the scourge that is ravaging Romania today. “Can’t you see that the country is full of slot machines?” Of course, something must be done (as if those who have led us so far have not done anything), so we are adding to the mistakes of the past. Among the old ones, we recall the ban on operation in localities with fewer than 15,000 inhabitants, which forced the industry to relocate (almost instantly) to larger localities, leading to obvious overcrowding, followed by the ban on the consumption of alcoholic beverages in specialized locations, causes players to take a break, go outside the hall and drink a beer and smoke a cigarette (because it is not allowed in the gaming hall), and from time to time they vent their anger on poor passers-by (which drives the mayors and local police, who have to maintain public order, to despair).
As for the new proposal, it will drastically limit the social aspects related to addiction (if the local council does not allow gambling in the territorial administrative unit, then people will spend their money on cabbage and other food—pretzels, for example—and the effect of gambling addiction, which haunts us, will disappear instantly, there will be no more theft or crime), but what about the economic aspects (casino floors have employees – taxes to the local budget, they pay rent – taxes to the local budget, they pay for advertising – taxes to the local budget, etc.), if these disappear (along with the taxes they pay), then there will be unemployed people (who will receive benefits from the local budget), empty commercial spaces (because there is not much demand – the state has made sure to leave supermarkets and malls in city centres, so that small businesses, which either had a grocery store or traded in other goods and products, would disappear).
But the proposal will solve at least two problems: firstly, there will be no need for reorganization in local public administration, because in a year’s time half of the bosses will be arrested “… from our point of view, the job will be to collect bribes from the survival zone!” as the former deputy prime minister said, and secondly, tax evasion will be eradicated – the state will no longer collect much from gambling, as most players will migrate to the grey and black areas of online gambling, without having to pay the 4% tax, which should be transferred in full to the local budget (unlike at present, when operators pay the consolidated budget, which then sends a fraction to the local budget).
In summary, we can say that the mistakes made by politicians in recent times are affecting the gambling industry in our country, and the chaotic legislative measures taken have not only failed to solve social problems (the addiction claimed by politicians, for which there is still no national study to tell us the actual level of addiction among the population and the total number of players, on the basis of which legislative measures could then be taken), but have also destabilized the market to such an extent that it now appears to be an “existential problem”. The Romanian state has turned into a veritable “robber” (it nationalized the ONJN’s revenues that were to be used to prevent and combat addiction, without using even a single leu for the purpose for which those funds were created and collected—violating constitutional and economic principles), the gambling industry has been effectively “milked” for money (tax increases three 3 times in 3 years, surcharges for vice – 2 types of taxes are collected for the same thing – a first vice tax that has been doubled from €500 to €1,000 per year/slot-machine, plus considerably increased amounts for the addiction prevention fund, 85% of which is transferred to the state budget, etc.), players have seen a considerable increase in income tax on this activity (remember the madness surrounding the reduction from 10% to 4% that was heavily promoted – another proof of unprofessionalism and ignorance of the field), which will lead to their migration to unlicensed online gambling in Romania (which does not charge any fees or taxes), a fact also noted by the NBR (which observes the huge amounts of money paid to this area), and on top of all this, the industry will be forced to continue paying “bribes for survival!”.
Will there be any leniency for this disastrous involvement of those who lead us and who make legislative regulations that have no connection with reality. How long will it take before decision-makers understand that education is essential also in this area (gambling is a form of entertainment and not a way to get rich quick), that living standards directly influence participation in gambling (it creates the illusion that the funds necessary for survival can be easily obtained) and that banning gambling is not the solution (prohibition will not solve addiction problems, but will make them uncontrollable, and state revenues from the exploitation of this monopoly will disappear, just as the 30 billion disappeared from the budget).
Dear Prime Minister, dear mayors, I believe that the time has come to treat this industry with professionalism and the respect it deserves. It has paid its bills during the pandemic (gambling operators paid their license and authorization fees unconditionally during the period of inactivity, which caused a host of financial problems for these companies), it pays taxes, rent, sponsorships for sporting events, and advertising at the highest prices on the market, and which has come under public scrutiny only because it is considered by some to be the “scapegoat,” the bogeyman that politicians pull out of the drawer to divert attention from the real problems of Romanian society and the national economy.
