EU Commission deems FDJ monopoly fair, but increases payment to €477m
The adjustment from €380m follows two 2020 complaints that the amount was too low.
Key points:
– The European Commission has called FDJ’s lottery game and sports betting monopoly fair
– However, adjustments to paying for this monopoly have been made in order to align with bloc rules
The European Commission has said the fee Française des Jeux (FDJ) must pay to operate its lottery game and sports betting monopoly is in line with competition rules, although it has made a financial adjustment, according to a decision made on Thursday 30 October.
The decision, which followed an in-depth state aid investigation, concluded that France was not providing the operator with unfair state aid, confirming the legality of France’s legislation to keep FDJ private and its provision of lottery games and sports betting for 25 years.
The investigation follows two complaints received by the European Commission in 2020, which claimed FDJ benefitted from unfair state aid. This was because the €380m ($413.1m), or €15.2m annual fee, that FDJ had to pay was too low. The investigation concluded that, while the aid was not unfair, some adjustments were necessary, with the total remuneration now set at €477m, in line with bloc rules.
As a result of the ruling, FDJ stock prices jumped 5.6% as of writing, from €36.66 at trade open on 31 October to €38.64 at 3:37pm the same day.
The ruling comes following FDJ’s completion of its tender offer for Kindred Group, which it completed in early October by acquiring over 90% of its shares. According to its Q3 report, this total sat at 91.8%. Due to the acquisition, some Kindred board members have resigned, including Chairman Evert Carlsson.
FDJ may be set to face some unique competition going into the new year, however, as the French Government has suggested a legalisation of online gambling as part of its 2025 budget plan. The Government said this week that it would hold a public consultation with industry stakeholders regarding the decision, according to sources provided to Gambling Insider, with the consultation set to take place sometime during the week starting Monday 4 November.
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