A new report by the European Commission has found that an industry-led memorandum of understanding (MoU) on online advertising and intellectual property rights has led to a significant reduction in the unintentional placement of advertising from Europe’s major gambling brands on websites which infringe upon intellectual property rights.

The MoU, published in 2018, was established to limit advertising on websites, such as illegal sports streaming sites, and mobile applications that infringe copyright or disseminate counterfeit goods.

As part of its review of the effectiveness of the MoU, the Commission has presented a new report today which found that the MoU has created more awareness among brands that their advertising may end up on IPR-infringing websites. According to the report, the share of total advertising for European businesses on IPR-infringing websites was reduced by 12% since the introduction of the MoU, while gambling advertising from Europe’s major brands (including all EGBA members) decreased by 20%, from 62% to 50% during the reporting period.

The European Gaming and Betting Association (EGBA) welcomes the report’s conclusions and is pleased with the significant progress made by EGBA members and other major brands in reducing the unintentional placement of their advertising on IPR-infringing advertising channels.

“EGBA welcomes the progress made by EGBA members and other major gambling brands in significantly reducing the unintentional placement of their advertising on IPR-infringing websites and is pleased that major online gambling companies are playing a central role in EU efforts to crack down on IPR infringement. Most reputable companies do not intend to advertise on IPR-infringing websites, but it happens and is difficult to control, and EGBA acknowledges that remedial action is needed to prevent it. That is why we have been actively engaging with the European Commission and other stakeholders to take action and are pleased those efforts are beginning to bear fruit,” Maarten Haijer, Secretary-General of EGBA, said.

“EGBA is committed to promoting responsibility and driving standards in Europe’s online gambling sector and we encourage other companies to join us – and be part of the solution, not the problem – by adhering to responsibility initiatives such as the MoU. This initiative proves that greater cooperation at EU-level can benefit the sector and how it is able to respond to the challenges it faces, including on advertising,” Maarten Haijer added.

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Europe’s video games industry is disappointed at today’s important decision by the Court of Justice of the European Union (CJEU) in the long-running Schrems v. Facebook Ireland case (Case C-311/18) that jeopardises the ability of European companies to continue to transfer data between EU Member States and the US.  The CJEU has ruled that, whilst data transfer agreements used by Facebook and other companies to share European users’ digital data with third countries are valid so long as the country “ensures an adequate level of data protection”, the EU-US Data Protection Shield (otherwise known as the Privacy Shield), that provides companies on both sides of the atlantic with a clear and cost-effective mechanism to comply with data protection requirements, has been ruled invalid.

The Court of Justice ruled that “the limitations on the protection of personal data arising from the domestic law of the United States on the access and use by US public authorities (. . .) are not circumscribed in a way that satisfies requirements that are essentially equivalent to those required under EU law”.

ISFE CEO Simon Little said: “A solution must be found. The transfer of data between the EU and the US is crucial to the full functioning and continued growth of Europe’s €21bn-strong video games industry.  Our industry is fully committed to the security of player data and supports the European Commission’s work to modernise European data protection rules and to improve the mechanisms for transferring data to third countries, but today’s decision is a blow to the ability of European games companies to reach a global market.”

EGDF COO Jari-Pekka Kaleva said: “The free flow of data between Europe and the US is crucial for game developer studios.  This ruling by the CJEU has the potential to create a significant regulatory market access barrier for European SMEs operating in global digital markets and it will adversely impact anyone working in Europe’s digital economy. Government officials and policy makers in Washington and in Brussels need to act quickly to build a new, more reliable framework for data transfers securing high standards on privacy and enabling the much-needed digital growth on both sides of the Atlantic.”