The European Commission has made a decision indicating that the fees French gaming company (FDJ) must pay to operate its lottery games and sports betting monopoly are in compliance with competition rules, despite the company making financial adjustments.
This decision was made after an in-depth investigation into state aid, concluding that France did not provide unfair state aid to the operator, thus confirming the legality of the French legislation maintaining FDJ's privatization and its provision of lottery games and sports betting services for 25 years.
The investigation was initiated following two complaints received by the European Commission in 2020, alleging that FDJ benefited from unfair state aid because the fees of €380 million (approximately $413.1 million) or €15.2 million per year that FDJ had to pay were too low. The investigation concluded that although the aid was not fair, some adjustments were needed, and the total compensation is now set at €477 million, in accordance with EU rules.
Following the announcement of the ruling, FDJ's stock price increased by 5.6%, rising from €36.66 to €38.64 as of the time of writing this article.
This ruling was made after FDJ completed its tender offer acquisition of Kindred Group, with the acquisition completed in early October, acquiring over 90% of Kindred Group's shares, specifically 91.8% according to its third-quarter report. Following this acquisition, some Kindred board members, including Chairman Evert Carlsson, have resigned.
However, FDJ may face some unique competition in the new year as the French government has proposed legalizing online gambling as part of its 2025 budget plan. According to sources obtained by Gambling Insider, the government indicated this week that it will hold public consultations with industry stakeholders about this decision, with consultations starting sometime within this Monday.
