Luxembourg Targets Illegal Gaming Terminals

Luxembourg Targets Illegal Gaming Terminals

Luxembourg has taken a decisive step toward reshaping its gambling regulation with the introduction of draft legislation targeting illegal gaming terminals operating in bars and cafés. Presented to the Parliamentary Justice Committee, the proposal represents the first stage of a broader review of how gambling is governed in the country, with online regulation expected to follow.

The immediate focus of the bill is the growing presence of unlicensed gaming machines in public venues. Lawmakers have expressed concern that these devices, often presented as internet access points, function in practice as gambling terminals while remaining outside existing controls. Their spread has raised questions not only about regulatory enforcement but also about the protection of minors and the effectiveness of the current legal framework.

Justice Minister Elisabeth Margue framed the proposal as an effort to restore legal clarity. By adjusting and refining definitions within gambling law, the government aims to ensure that enforcement authorities can more easily distinguish between permitted devices and those operating unlawfully. According to the minister, this clarity is necessary to confirm that only games authorised by the Luxembourg National Lottery may be offered outside the country's single licensed casino.

One of the central changes proposed by the bill concerns enforcement powers. Under the new framework, authorities would have a clearer legal route to seize illegal gaming terminals when they are identified. At present, enforcement actions can be slowed by uncertainty over how certain machines are categorised, particularly when they are not explicitly marketed as gambling devices. The government argues that this ambiguity has allowed illegal terminals to proliferate in everyday social settings.

Responsibility under the draft legislation would not rest solely with machine suppliers. Bar and café owners who allow illegal terminals to operate on their premises would face stronger sanctions. This shift reflects an intention to address the environment in which such devices appear, rather than focusing enforcement exclusively on manufacturers or distributors. By extending accountability to venue operators, the government hopes to reduce the commercial incentives that drive unregulated gambling.

At the same time, the proposal includes a three-month transitional period, during which businesses would be expected to review their premises and bring them into compliance. This period is designed to give operators time to remove unauthorised machines or seek clarification where the status of a device is uncertain. The inclusion of a transition phase suggests an effort to combine stricter enforcement with procedural fairness.

The draft law also distinguishes between commercial gambling and certain community-based activities. Raffles held at local village festivals would continue to be permitted, even when minors are present. These exceptions reflect an attempt to preserve traditional events while tightening controls on gambling activities that operate continuously and profit-drivenly.

Luxembourg's regulated land-based gambling market remains limited. Casino 2000 in Mondorf-les-Bains is the country's only legal casino, operated through a partnership between the Partouche Group and Luxembourg Casino. Outside this venue, gambling machines are restricted to those operated by the National Lottery. Despite this narrow framework, unregulated machines have become a common feature in cafés, highlighting the gap between legislation and practice that the government now seeks to address.

While the bill focuses on physical gaming terminals, it also signals a broader policy discussion. The government has confirmed that a second phase of reform will examine how online gambling should be regulated, an area where Luxembourg currently lacks a dedicated legal structure. This forthcoming review is expected to raise more complex questions than the current enforcement-focused proposal.

Minister Margue has previously indicated that one option under consideration is granting the existing land-based casino operator the right to offer online casino games. Such an approach would likely preserve a monopoly structure rather than opening the market to multiple licensees. However, the government has stressed that no decision has been finalised, and that several technical and regulatory issues remain under evaluation.

Among these are the implementation of geo-blocking measures, the organisation of regulatory oversight, and the practical challenges of enforcement in a digital environment. These considerations suggest that any move toward online regulation will proceed cautiously, particularly given Luxembourg's small market size and cross-border digital exposure.

In a European context, Luxembourg occupies an increasingly unusual position. Most European jurisdictions now operate some form of regulated online gambling system. With Finland preparing to move away from its monopoly model, Luxembourg would be the only EU member state without specific online gambling legislation. Industry bodies have noted that this absence leaves consumers reliant on offshore platforms that fall outside national supervision.

The government's decision to begin reform with land-based enforcement is therefore a preparatory step. By tightening control over physical gaming terminals and clarifying legal definitions, Luxembourg is laying a foundation for broader regulatory decisions.