EHRM, 06-05-2008, nr. 27968/05

The applicant, Ladbrokes Worldwide Betting, is a betting and gaming company based in Harrow, United Kingdom. It is represented before the Court by Mr S. Widmark and Ms T. Cabander, lawyers practising in Stockholm. The Swedish Government (‘the Government’) were represented by their Agent, Ms I. Kalmerborn, Ministry for Foreign Affairs.

The applicant complained under Article 6 § 1 of the Convention that, due to Mr Dexe's participation in the case, the Supreme Administrative Court could not be considered to have met the requirements of independence and impartiality. The applicant referred to what it had stated in its plea for disqualification to the Supreme Administrative Court. In addition, it submitted that, between 1997 and 2001, Mr Dexe's superior had been the Minister for Finance, Mr Ringholm, who had taken the impugned Government decision of 18 March 2004. Moreover, in October 2004, Mr Dexe had participated in two other cases adjudicated by the Supreme Administrative Court, including the one referred to by the court in its judgment of 20 June 2005, in which the primary issue had been the same as in the applicant's case of judicial review.

The applicant complained that the Supreme Administrative Court had not met the requirements of independence and impartiality under Article 6 § 1 of the Convention. In so far as relevant, this Article reads as follows:

For Article 6 § 1 under its civil head to be applicable, there must be a dispute over a right which can be said, at least on arguable grounds, to be recognised under domestic law. The dispute must be genuine and serious. It may relate not only to the actual existence of a right but also to its scope and the manner of its exercise. The outcome of the proceedings must be directly decisive for the right in question (see, among other authorities, Frydlender v. France [GC], no. 30979/96, § 27, ECHR 2000-VII).

The respondent Government submitted that the application was incompatible ratione materiae, as the applicant did not have a right that could arguably be said to be recognised in domestic law. The Lotteries Act was a prohibitive legislation, the main purpose of which was to decrease the potentially harmful economic and social consequences of gambling and to ensure that the proceeds of games and lotteries promote objects of public benefit. In contrast to lottery and gaming permits issued by the National Gaming Board and other authorities and which were regulated in the Lotteries Act in a detailed and precise manner, there were no tangible criteria applicable to permits issued by the Government under section 45 of the Act. Instead, the applicant's request for a permit to provide betting and gaming had been wholly dependent on whether the Government considered it appropriate or not. The Government's discretion in these matters was therefore unfettered.

The applicant contested this view, maintaining that section 45 was the relevant provision for other applicants than non-profit making associations, thus implying, at least on arguable grounds, a right for such other applicants. Moreover, the Government's discretion was not limited, as allegedly shown by its practice of granting permits to state-controlled gaming companies and to commercial banks. It was asserted that the Government's practice had established certain criteria, or factors, which were decisive for the grant of permits under section 45, namely the status of the applicant, the nationality of the applicant, and the nature of the activity for which a permit was sought. The applicant contended that the reasoning of the impugned decision of the Government showed that a permit had been refused solely on the ground that the applicant was not based in Sweden. It further referred to the ongoing investigation by the European Commission as to the Swedish lottery legislation's compliance with EC law.

As to whether a dispute over a right existed so as to attract the applicability of Article 6 § 1, the Court will first address the issue whether a right for the applicant to provide betting and gaming services could arguably be said to be recognised under Swedish law.

In view of the status of the Convention within the legal order of Sweden, the Court observes firstly that the Convention does not grant to individuals or companies the right to provide betting and gaming services. Such a right can be derived neither from Article 6 § 1 nor from any other provision of the Convention or its Protocols. It follows that the question whether such a right can be said to exist in any particular case must be answered solely with reference to domestic law.

In deciding whether a right, civil or otherwise, could arguably be said to be recognised by Swedish law, the Court must have regard to the wording of the relevant legal provisions and to the way in which these provisions are interpreted by the domestic authorities.

The Court reiterates that the provision of betting and gaming services is not free in Sweden. The Lotteries Act restricts this activity and makes it dependent on the grant of a permit. The main rule, section 15, provides that a permit may be given to a Swedish non-profit making association which fulfils certain requirements. Being neither a non-profit making association nor a Swedish subject, the applicant company could not have its application for a permit examined under that provision but only under the special rule laid down in section 45. According to the latter provision, the Government may grant a special permit in other cases and according to other procedures than those regulated elsewhere in the Act.

As can be seen from the impugned decision of the Government of 18 March 2004, it took into consideration that betting and gaming in Sweden was essentially reserved for the State, certain non-profit making organisations and the equestrian sports, and that the profits should be to the benefit of the public or for public utility purposes. The overall concern of protecting gamblers from harmful economic and social consequences, mentioned by the Supreme Administrative Court in its judgment of 20 June 2005 as a main objective of the restrictive legislation, may also have played a part in deciding on the applicant's application. However, there is nothing in the Government's decision which indicates that the private interests of the applicant were or should be of relevance to the examination of the application under section 45. The provision itself states that the Government may grant a permit, but does not specify how and when this power should be used. Furthermore, the preparatory works do not lay down any conditions in this respect. This is in stark contrast to sections 15 and 16, which stipulate specific requirements for a permit to be granted.

The applicant has claimed that it can be adduced from the Government's practice that certain factors — the status and nationality of the applicant and the nature of the activity — are decisive for the grant of permits under section 45. However, even assuming that such factors can be derived from the very few examples of positive decisions taken under that provision, these are not concrete criteria that an applicant could rely on when requesting a permit. For example, even if the nature of an applicant's activity could be of concern to the Government in examining an application under section 45, the Government's practice does not give any direction as to what type of activity would qualify for a permit. Moreover, insofar as the nationality is of importance, the practice would rather indicate that the present applicant is excluded altogether.

The applicant has further referred to the ongoing investigation of whether the Swedish lottery legislation is in compliance with EC law, notably Article 49 of the EC Treaty. In this respect, the Court notes that those proceedings are still pending and that the outcome is thus not known. In any event, even if the proceedings would result in changes in the Swedish legislation, such changes will not have any bearing on the status of the Lotteries Act and the applicant's possible rights under that Act at the relevant time, namely the dates of the decision and judgment in the case.

Having regard to the foregoing, the Court concludes that section 45 of the Lotteries Act confer on the Government a power to grant a permit to arrange lotteries whenever they consider it appropriate. The grant to a public authority of such a measure of, in practice unfettered, discretion clearly indicates that no actual right can be said to be recognised in law (see Masson and Van Zon v. the Netherlands, judgment of 28 September 1995, Series A no. 327, pp. 19–20, § 51, and Ankarcrona v. Sweden (dec.), no. 35718/97, p. 582, ECHR 2000-VI). In this context, the Court notes that the instant case manifestly differs from situations where a state has introduced an actual right which can be related to certain criteria, the existence of which can without particular difficulties be examined by the competent authorities and, subject to appeal, the national courts. It is clear that such rights fall within the scope of Article 6 § 1, whether they concern, for example, the right to social security and social assistance (see, for example, Feldbrugge v. the Netherlands, judgment of 29 May 1986, Series A no. 99), the right to a public service transport licence (Pudas v. Sweden, judgment of 27 October 1987, Series A no. 125-A), or the right to an alcoholic licence (Tre Traktörer AB v. Sweden, judgment of 7 July 1989, Series A no. 159).

Section 45 of the Lotteries Act contains no such applicable criteria, but leaves it to the discretion of the Government to decide whether a permit shall be granted or not. In no way is the situation or needs of the applicant in question decisive to the outcome of this evaluation. On the contrary, no regard at all is paid to such circumstances.

In view of the above considerations, the Court concludes that, whether or not the impugned proceedings involved a dispute for the purposes of Article 6 § 1, the claims asserted by the applicant did not in any event concern a right which could arguably be said to be recognised under Swedish law.

It follows that Article 6 § 1 of the Convention is not applicable in the instant case and that the application must be rejected as being incompatible ratione materiae with the provisions of the Convention, in accordance with Article 35 §§ 3 and 4. In view of the above, it is appropriate to discontinue the application of Article 29 § 3.

Declares the application inadmissible.

Santiago Quesada

Registrar

Josep Casadevall

President