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The Distinction Between Legal and Illegal Betting in the Context of The

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Diplomstudium Rechtswissenschaften The Distinction Between Legal and Illegal Betting in the Context of the Convention on the Manipulation of Sports Competitions with Reference to The Netherlands, Finland, Switzerland and Austria Diplomarbeit aus Public International Law zur Erlangung des akademischen Grades eines Magister der Rechtswissenschaften an der Paris Lodron Universität Salzburg eingereicht von Stephan Victor Small Matrikelnummer 00007814 Betreuer: Ao. Univ.-Prof.Dr.Michael Geistlinger Salzburg, September 2017 1 Table of Contents Page 1. Introduction 5 2. Terminology 7 3. Lotteries 9 3.1 Lotteries from the beginning 9 3.2 Current Status of Lotteries 11 4. Gambling in Sport 14 4.1 Ancient Rome-1960 14 4.2 1960-Present 15 5. Manipulation of Sports Competitions 17 5.1 Introduction 17 5.2 Tennis, cricket and baseball 18 5.3 Match-fixing in Football 19 5.3.1 Arrangement fixes 20 5.3.2 Gambling Fixes 20 5.4 Selected Cases of Match-Fixing in Football 22 5.5 Money Laundering in Football 24 6. International Initiatives to combat Match-Fixing and the Macolin Convention 26 6.1 Introduction 26 6.2 Match-fixing in football in Austria, Finland, The Netherlands and Switzerland 27 6.3 Compliance of Austria, Finland, The Netherlands and Switzerland to the 30 Recommendations of the Macolin Convention 7.Match-fixing in Europe 39 8. Borderline between legal and illegal betting in Austri100a, Switzerland, The Netherlands and Finland 42 8.1 Austria 42 8.2 Switzerland 43 8.3 The Netherlands 44 8.4 Finland 45 8.5 Axis of Evil: the Asian illegal betting market 45 9. Combatting Illegal Betting: National Interpretations and Compliance with the Macolin Convention 46 9.1. Control of the Betting Market 47 9.2. Sanctions and Measures and Criminal Offences 49 9.3. Money Laundering 51 10. Conclusions 52 11. Private Communications 57 12. Bibliography and documents 58 2 13. Appendices 73 Appendix I: Council of Europe Convention on the Manipulation of 73 Sports Competitions Appendix II: Explanatory Report to the Council of Europe Convention on the 91 Manipulation of Sports Competitions 3 Abbreviations ARJEL Autorité de Régulation des Jeux En Ligne BASPO Swiss Federal Office for Sport BGS Swiss “Bundesgesetz über Geldspiele” FATF Financial Action Task Force FIFA Fédération Internationale de Football Association FIFPro Fédération Internationale des Association de Footballeurs Professionnels FINCIS Finnish Center for Integrity in Sports GLMS Global Lottery Monitoring System GRECO Group of States Against Corruption ICC International Criminal Court ICSS The International Centre for Sport Security IOC International Olympic Committee KNVB Koninklijke Nederlandse Voetbal Bond KSA Dutch Gambling Authority LG Lotteriegesetz LV Lotterieverordnung MLB Major League Baseball OECD Organisation for Economic Co-operation and Development ÖFB Österreichischer Fußballbund SAFP Swiss Association of Football Players SFL Swiss Football League SFV Swiss Football Federation SLP Finnish Football Association SOGA Soccer Gambling TIU Tennis Integrity Unit UEFA Union of European Football Associations UNODC United Nations Office on Drugs and Crime UWG Gesetz gegen den unlauteren Wettbewerb VETO Europol Operation Codename WLA World Lottery Association 4 1. Introduction Sport is a democratizing human activity; it crosses social and national barriers and opens up opportunities to anyone with athletic talent. This is very much the case in football, which features players from diverse economic and social backgrounds. Moreover, sport ties together all members of the human race and as such contributes to the maintenance of peace. It is for this reason that so much attention has focused on preserving the integrity of sport worldwide. Sport integrity faces a major threat from the link of sport and especially football with the betting industry. While gambling on the outcome of sporting events has been a popular pastime for at least two millennia, the rapid growth and globalization of the sport gambling market over the last few decades has fostered the parallel increase in cheating and corruption. Criminals exploit football in two ways: to launder money, via the acquisition of weak clubs and by “arranging” the outcome of matches, by so called “match-fixing” for gambling purposes.1 The potential profits for match-fixing are high: according to recent estimates the annual turnover of the Asian sports gambling market (mainly illegal) which represents 60% of the global market amounted to $450 billion, compared to $100 billion for the Asian pharmaceutical industry.2 Because of the internationality of sport, the close collaboration between national agencies and international non-governmental organizations is essential to preserve the integrity of sport, to promote fair play and, in particular, to fight corruption. This is underlined in a statement from the UNODC report from 2016: “For the majority of people, sport forms an integral part of daily life, whether as active participants or passive spectators, providing many positive impacts on society as a whole. Corrupting sport through match-fixing seeks to destroy this positive influence on society and is one of the key costs of corruption.” 3 The phenomenon of match-fixing has been justly identified as a universal evil threatening the integrity of sport by many prominent international organizations: The United Nations 1 Hill D, The Insider’s Guide to Match-Fixing in Football, Toronto 2013, 46. 2 Hill D, The Revolution. Asser International Sports Law Series, Sports Betting: Law and Policy, The Hague 2012, 11. 3 UNODC, Resource Guide on Good Practices in the Investigation of Match-Fixing, 15 <unodc.org/documents/corruption/Publications/2016/V1602591- RESOURCE_GUIDE_ON_GOOD_PRACTICES_IN_THE_INVESTIGATION_OF_MATCH-FIXING.pdf> (30.07.2017) 5 (UNODC); Interpol; Europol; Transparency International; Financial Action Task Force (FATF); Group of States Against Corruption (GRECO); International Center for Sport Security (ICSS). All of these organizations have made detailed recommendations about combatting match fixing, following the general principles of the Council of Europe Convention on the Manipulation of Sports Competitions, otherwise known as the “Macolin Convention” from 2014.4 The Macolin Convention and the international organizations provide useful guidelines and training schemes, but none of them has the judicial authority for making arrests and imposing punishment. As the Executive Secretary of FATF stated in a speech in 2016: “You can’t effectively combat corruption without laws and regulations …… you also can’t combat corruption unless you enforce these laws and regulations effectively and proportionately”.5 In short, each country needs to establish effective procedures itself to fight criminality in sport. Only through a tight collaboration between national sport bodies, betting agencies, the police and the judiciary can match–fixing be eliminated. The present thesis reviews the current policies adopted by four European countries, Austria, Finland, The Netherlands and Switzerland, to tackle match fixing in football and illegal gambling in sport. Chapters 3 and 4 provide background reviews of the history of gambling, in lotteries and in sport. Chapter 5 outlines the means by which different types of sport competitions have been manipulated, with a focus on arrangement and gambling fixes in football. Chapter 6 reviews the measures taken by the four selected countries to adopt the recommendations of the Macolin Convention and Chapter 7 compares the situation with other countries in Europe. The borderline between legal and illegal betting is discussed in Chapter 8 and national measures to address illicit gambling and corruption in Chapter 9. Finally, an appraisal of the current situation and future challenges are presented in the conclusions, Chapter 10. 4 Council of Europe Convention on the Manipulation of Sports Competitions, Macolin 2014 <http://www.coe.int/en/web/conventions/full-list/-/conventions/rms/09000016801cdd7e> (14.08.2017) 5 FATF, Ending Impunity: Creating a level playing field by enforcing the conventions we have < http://www.fatf- gafi.org/publications/fatfgeneral/documents/tackling-corruption-together.html> (30.07.2017) 6 2. Terminology Many of the terms used in the present work have been defined in the “Explanatory Report to the Council of Europe Convention on the Manipulation of Sports Competitions”. The definitions below in italics have been taken directly from or in an abbreviated form from that report. 6 Match- fixing: “covers any intentional and improper alteration of the course or result of a sports competition in order to remove all or some of the uncertainty associated with this competition, with a view to obtaining an undue advantage for oneself or for others.” 7 Integrity of sport: “is understood as an ethical fundamental value in the sport movement characterized by credibility, transparency and fairness as well as by the unpredictability of sports competitions results.” 8 Fairness: “refers to practising a sport while faithfully respecting the rules of competition, and to providing everyone with an equal chance of taking part in sport.” 9 Sports betting: “refers to the predictions made by wagering a stake on an event occurring during a sports competition in order to obtain winnings.”10 Sports betting operators: “covers all kinds of operators providing sports betting services, landbased or remote, publicly or privately owned, specialised in sports betting or not (bookmakers, specialised sports betting operators, gambling
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