By Foo Yun Chee and George Georgiopoulos
BRUSSELS/ATHENS, Jan 24 (Reuters) - OPAP’s gambling monopoly in Greece is illegal, Europe’s highest court ruled, pushing the company’s shares down by more than 11 percent as investors fret over the threat to its market dominance.
However, judges at the Luxembourg-based European Court of Justice (ECJ) also said Greek authorities may not need to open up the sector if they implement reforms to protect consumers.
The verdict on Thursday was in response to a challenge by rivals William Hill, SportingBet and Stanleybet against OPAP’s monopoly in a Greek court, which subsequently sought advice from the ECJ.
EU rules prohibit national laws from granting exclusive gambling rights to a single company, unless the authorities are genuinely reducing access to gambling and controlling expansion of the sector to combat criminality, the ECJ said in a statement.
Shares in OPAP shed as much as 21 percent after the ruling. They ended 11.5 pct lower at 6.26 euros on Thursday.
“The court ruling reduces the future value of OPAP as it opens up the market,” said Theodore Krintas, head of wealth management at Attica Bank.
The Greek state is selling 33 percent of OPAP, almost its entire stake, as part of a privatisation drive agreed with its international lenders in return for its EU/IMF bailout.
“It highlights the need to act fast and not let things drag on once privatisation decisions are taken at a government level. The ruling is a good example that delays may allow future developments to affect the valuation of the asset,” added Krintas.
OPAP said it backed the country’s gambling policy adding that it has one of the most restrictive laws in Europe.
The Luxembourg court had in previous cases found problems with gambling monopolies in Italy, Germany and Austria.
Judges said Greece must either liberalise the market, opening it up to competition and treating local and foreign operators equally, or reform OPAP’s monopoly.
Liberalising the market is not compulsory under EU law.
If the Greek authorities determined that opening gambling to competition would not allow for sufficient consumer protection, Greece could undertake “reforms of the monopoly and make it subject to effective and strict controls by the public authorities”, the court said.