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NMa: Postal Code Lottery May Take over Bank Giro Lottery

The Netherlands Competition Authority (NMa) has given the Postal Code Lottery [Postcodeloterij] the go-ahead to take over the Bank Giro Lottery [BankGiroLoterij]. In the area of lotteries and lotto games, three players will remain active after this acquisition, namely, the Postal Code Lottery, the Lotto and the State Lottery [Staatsloterij]. The State Lottery is the largest with a market share of approximately 55%. After the acquisition, the Postal Code Lottery will have a market share of approximately 35%. Since the market share of the Postal Code Lottery will only increase by a small percentage as a result of the acquisition and the State Lottery will remain by far the largest player on this market, NMa has no reason to assume that a dominant position will arise or be strengthened by this acquisition. In addition, these players experience competitive pressure from, for instance, scratch-card lotteries, small-scale lotteries and foreign lotteries and lotto games.

Since only a small number of players are active on this market, NMa carried out research to establish whether there is any danger of coordination between these players, which could result in a collective dominant position. Since the three players differ considerably from each other with regard to their size and products, the market does not lend itself to mutual coordination, there is full-blown competition between the parties and the market may still grow, NMa has no evidence that a collective dominant position may arise.

The Postal Code Lottery and Lotto are lotteries for good causes, while the State Lottery is not. As a result of this acquisition, two players with lotteries for good causes will merge. On the other hand, the income for good causes may be greater as a result of the new combination. In addition, the income from the lotteries constitutes only a small part of the total income for good causes. Other sources of income include, for instance, collections, direct marketing, sponsoring, organisation-specific lotteries, legacies and the like.

The market for lotteries and lotto games is highly regulated, as it is in other European countries. Offering a lottery or lotto game is prohibited unless one has a licence. The (previous) Cabinet announced its intention to issue new licences to new lottery providers. In addition, plans also exist to turn the State Lottery into a lottery for good causes. This may increase the dynamism of the market.