Gambling is an economic leisure activity that, due to its peculiarities, can affect issues of social interest such as order or public health, which justifies its regulation. The point is that the positions on this activity are very different: in many cases, it is prohibited, while in others the freedom is absolute and even promoted by the different regulators.
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In general, it would be a matter of balancing the economic impact generated by regulating and taxing this activity with its negative aspects (addiction, compulsive gambling, fraud, corruption, etc.).
In Spain, after more than 30 years with hardly any shocks, the gaming industry began to experience a profound change. In 2008, following in the footsteps of the first licenses granted months earlier in the Basque Country, the first bookmakers began to operate in Madrid. Until that time, legal sports betting in Spain was largely limited to predictions on the results of professional football matches through La Quiniela; without prejudice to the bets that had been made illegally over the Internet for several years.
Gradually, other autonomous communities joined the granting of licenses to new operators for the opening of this type of premises, which, together with the growing availability of sports betting sites on the Internet and the consequent expansion of gaming opportunities, contributed certainly to creating a completely new scenario.
As a consequence of the growth of this market and its potential social repercussions, in 2011 progress was made with Law 13/2011, of May 27, on gambling regulation towards the legalization, regulation, and normalization of sports betting in all its forms. (Pools, sports bets with fixed odds or compensation, etc.) and gaming channels.
Currently, the General Directorate for the Regulation of Gambling (DGOJ), dependent on the Ministry of Economy and Finance, regulates, controls, and, where appropriate, sanctions sports betting activity in Spain.
Side A: a business with an economic impact
Sports betting, in addition to being a source of financing for professional sports through different forms of sponsorship, promotion, and/or advertising, constitutes an economic activity that, according to the 2018 Gambling Yearbook in Spain, supports some 2,350 direct jobs and generates around 30 million euros via gambling taxes. In 2017, the gaming margin or GGR (Gross Gaming Revenue) of sports betting exceeded 740 million euros.
In any case, and although they share some characteristics with other games of chance, it should be clarified that sports betting is not a pure game of chance in the sense that the winning combination is not the result of a draw, but is related to with the final result of a certain sporting event.
Thus, sports betting makes it possible to live, in an even more intense way, an existing hobby among consumers, such as sports, which must be taken into account when explaining the relatively recent expansion of this market.
Side B: problematic gambling, corruption, and integrity
However, and as has already been pointed out, sports betting also constitutes a certain risk both for society and for the sport itself.
From the point of view of public health, and perhaps accentuated by the publicity and media presence of this activity, in addition to the fact that its consumption begins at younger ages, the number of gamblers with gaming episodes problematic has grown in parallel with the development of gambling opportunities.
On the other hand, and although the potential income for sport from the sports betting industry has multiplied, the risk to the integrity of sport has also been notably accentuated.
The high liquidity of the sports betting industry, together with the fact that it is mainly concentrated in unregulated markets, and the development of the “in-play” modality or in-play bets (that is, bets made while the event sports is ongoing), has increased the potential profitability of manipulating the results of sporting events.
The fact is that according to the recent revelations of football match-fixing in Spain and the identification of numerous cases of suspicious betting, this type of crime seems to be proliferating.
A serious threat to the sport
To the Eldense Case, the investigations of the Pizarro and Cortés operations have recently been added, which in 2018 led to several arrests linked to a network of fixes in Spanish football.
Currently, the Oikos operation is being carried out in relation to the crimes of sports fixing, money laundering, and criminal organization.
From the monitoring and control of bets at all levels of its competitions and in official friendly matches during the 2017-18 season, La Liga reported a total of 39 complaints and 9 appearances in lawsuits for possible match-fixing in football matches.
The increase in these types of cases constitutes a serious threat to the sport, even questioning its integrity. Consequently, the jurisprudence of the Court of Justice of the European Union considers sports betting as a special economic activity and has even admitted some limitations to the free provision of betting services (the justification for its intense regulation – prohibition in some cases – lies in fact in the objective of the fight against fraud, corruption, and crime).
Final considerations – Towards a balanced growth
The observed trend is that sports betting is growing, mainly due to the global expansion of gaming opportunities and the availability of Internet betting sites. But also, because technological advances provide ease of access and other attractive features for players, such as “in-play” betting.
The current regulations aim to respond to the needs of the sector by offering the appropriate regulatory instruments, but also legal certainty to gaming participants and operators, as well as measures to protect public order and prevent money laundering. In fact, the operators that provide gaming services in the Spanish sports betting market are subject to an authorization process, supervised by the DGOJ.
The ultimate objective must be to balance the demand and interest of potential sports betting consumers, the economic activity generated by this form of gambling, and the negative externalities associated with it.