Pokerstars Loses 2011 Unfair Competition Case In Spain

A recent ruling by the Supreme Court in Spain has found PokerStars guilty of carrying out gambling operations in the country before it obtain an official license.

The case against PokerStars was brought by rival gaming firm Codere, which alleged that PokerStars along with several other companies, were operating in Spain without necessary authorization from the country’s gaming authorities.

The case had been initiated against PokerStars in 2011, before the company was granted an official license by Spain’s gambling regulator Dirección General de Ordenación del Juego in 2012.

PokerStars has been accused of unfair competition for offering gaming services prior to obtaining the official license.

A Madrid court ruling in 2012 was made in favor of Codere but another court in Barcelona found that PokerStars was not operating illegally as it had sought the necessary authorization but hadn’t received it. However the Supreme Court made it clear through its judgment that online poker and online gambling in general was not legalized at that point of time and PokerStars along with other gambling operators had breached the law by launching operations without proper clearance.

The Supreme Court also pointed out that PokerStars’ Spanish-language website targeted Spanish residents without having explicit approvals to offer gaming services to the country’s citizens. The Supreme Court though decided against granting Codere the damages it had sought for suffering unfair competition from PokerStars and providers.

The Court refused to award compensation to Codere based on the fact that although PokerStars was acting in an illegal manner, it was not an isolated case but a generalized market condition in which the relevant gaming authorities were tolerating such illegal activity despite having knowledge of the same.

PokerStars currently holds licenses in the country for offering an entire range of gaming services including online poker, table games, slots and sports betting. It leads the Spanish poker market with nearly 60 percent market share.

The online poker giant has in recent years voluntarily withdrawn from markets where it is illegal to offer gaming service without a valid license. Acting as a bad actor can have consequences like being placed in a blacklist which can severely impact PokerStar’s chances in new gaming markets, particularly in countries like the United States.

In the recent past, PokerStars has withdrawn from countries like Portugal, Israel and Slovenia when gaming regulations underwent changes and late tried re-entering countries where it could obtain the necessary regulatory permit. The company recently announced that it would be withdrawing from Australia as the country is waiting on pending legislation that would require PokerStars to obtain an official casino license to continue to operate down under.