A move to clamp down on regulated gambling in Latvia’s capital city, Rīga, has been deemed against the law of the land by the nation’s Constitutional Court. Rīga’s City Council has tried to oust gambling since 2019, but with the latest ruling, the anti-gambling efforts are now futile.
Latvia’s Constitutional Court has pronounced itself on a matter that has impacted the Eastern-Europe country in a big way. The country’s Constitutional Court declared a previous ban on gambling in the country’s capital, Rīga, unconstitutional. The ruling, which sent shockwaves throughout the nation, opined that the Rīga municipality did not give sufficient reasons to back up their policy change.
According to the Constitutional Court, the Rīga gambling ban would lead to the closure of gambling establishments around the country’s capital city. To understand the crux of contention, let’s take a trip down memory lane, half a decade ago, when the city council decided to close down these wagering establishments.
In early 2019, the Rīga City Council government decided to shut down all the gaming venues in the country’s capital. The plan was extensive and would be implemented by the city’s Public Relations Department, targeting establishments in the uptown and downtown areas of the capital city.
Nils Usakovs, the city’s mayor at that time, issued orders for the municipality’s Legal Affairs Department and Urban Development Department to draft a council-wide decree that would see the licenses of the gaming establishments scrapped. The decree was to apply to all gambling venues in the capital city besides those located in four- and five-star hotels around the city.
At that time, the municipality’s argument point was that the country’s law on gambling permitted it to act in such a manner. Per the said laws, if the application of gambling on the said premises or locale created substantial impairment to the city residents, then the city or the local government council was permitted to act accordingly. In this case, they saw fit to terminate the permits of the said casino, bingo hall, gambling hall, and any betting shop.
At that time, Usakovs was adamant that this decision was made with the best interests of the Rīga population at heart. He thus stated:
“This is one task that we have to accomplish. We made the first step in 2017 when we banned gaming venues in the historical center of the city. At the same time, it is clear that the problem of gambling is the worst in the neighborhoods of Rīga. That is why the municipality has to do everything in its power to finally make Rīga a city completely free of gambling.”
As the previous mayor’s statement had mentioned, the council had decided to shut down 42 gambling halls in 2017. But then, a spanner was thrown in the works of that plan as these establishments had gone to court to keep things running. The decree in 2019 was set to be effected within a 5-year time frame.
The legal challenge against the Rīga municipality’s decision to ban gambling in the city was mounted by Alfor Ltd, Olympic Casino Latvia Ltd, and Joker Ltd, all gambling entities in the Eastern European country. Their argument against the city’s spatial plan was based on violating the country’s Article 105 of its constitution, a clause safeguarding property rights and permitting the establishment of restrictions only through the proper channels.
The contest protested the city council’s two decisions: closing down 42 gambling venues in the city center 6 years ago and canceling 139 permits for gambling establishments outside the city center last year. The legal challenge further postulated that the compulsory expropriation of property for public needs was a clause that was a preserve of exceptional cases, which the plaintiff felt was not the case.
With the city council decree having a deadline of 2025, the court was contacted to gauge the rationale of these decisions. Before the judgment, the Latvian Gambling Business Association had claimed that Rīga City Council’s actions were a direct violation of the rights of gambling merchants. Thus, it was contrary to the principle of legitimate expectations as well as the rights of foreign investors to participate in the Latvian economy.
In the court’s pronouncement of the case, it admitted that, indeed, the municipality reserved the right to assess on its own where gambling restrictions ought to be imposed in its territory. The court further stated that when it came to territorial planning, the municipality reserved the right to establish as many territories as it deemed fit where gambling could not occur. Indeed, the city administration was within its rights per its implementation of the Latvian constitution. That said, the Constitutional Court stated that the municipality must comply with the principle of assessment of the territory set out in the authority granted.
It was therefore concluded that the Rīga City Council failed to clearly state why the organization of gambling had been prohibited in the functional zoning of the spatial plan. Mind you, gambling as a commercial activity was one of the allowed uses of the said territory. Emphasis was also placed on the fact that as the council implemented its decree, fundamental rights stated in Article 105 of the constitution must be guaranteed. Likewise, other norms of the Latvian constitution must be followed, including the protection of individual rights of persons guaranteed within the perspective of potential risks to gambling addiction.
Consequently, the Constitutional Court found an infringement of fundamental rights outlined in Articles 1 and 5 of the Latvian constitution, prompting it to nullify the decree.
Judging from the situation in its capital, you can imagine how scaled-down the gambling activities in Latvia are today. Currently, the country only features 3 operating casinos, 194 amusement arcades, one bingo amusement arcade, and 76 betting venues. That said, the industry is still generating quite a considerable amount of revenue reported in 2023, totaling €288 million ($313 million), representing a 9 % increase from the previous year’s figures.
Blackjack
Slots
Roulette
Baccarat
Craps
Poker
