The acquisition of four betting companies: The majority shareholder of SMS Pariaz makes a commitment to the Competition Commission to resolve competition problems

• three betting companies, namely: Peerless Ltd, J.S. Henry Co Ltd and Peak Pools Ltd
•  K. Chai Hai Limited, which held a majority of shares in Serge Henry Ltd, a lottery company, and Bosco & Co. Ltd, a betting operator

It should be noted that prior to these acquisitions, SMS Pariaz Ltd was the majority shareholder of Silver Sports Ltd, a betting operator. The executive director had expressed concerns that these acquisitions could have the effect of reducing competition in the gambling sector:

• pool betting: these acquisitions could enable the parties concerned to control three of the four operators and thus significantly increase market concentration and reduce competition. Since some of the acquirer's businesses were also resellers of pool betting, there were potential risks of restrictive practices at the level of the distribution chain that could affect competition.
• lotteries (sweepstakes): these acquisitions could enable the acquirer to control or influence two out of three operators and therefore hinder competition. Some businesses of the acquirer are also lottery resellers (sweepstakes) and, as a result, there were also risks of restrictive practices that could harm competition.
• fixed-odds football betting: concerns have been raised that the acquirer has control over more than one license, which could be to the detriment of competition due to its ability to coordinate bets.

During the investigation, the parties involved were informed of the potential competition concerns identified by the Executive Director and they offered undertakings to the Competition Commission to remedy the situation, in accordance with the provisions of section 63 of the Competition Act 2007.

The engagements

The parties concerned have undertaken to:

• sell all of their shares in J.S. Henry Co Ltd to an independent buyer
• offer their services as promoters of pari-mutuel and lotteries to resellers independent of this merger on fair, reasonable and non-discriminatory terms. The parties concerned must also consider the resale of other pari-mutuel and lottery services through their points of sale, and this, on the same conditions mentioned above.
• ensure that Bosco & Co. Ltd, SMS Pariaz Ltd and Silver Sports Ltd determine their odds independently
• submit reports to the Competition Commission on the implementation of the sale and the implementation of their commitments for a period of three years.

The Commission's decision

After evaluation, the Executive Director considered that the undertakings offered would resolve the competition problems satisfactorily, and so he recommended the adoption of these undertakings to the Commissioners, who accepted them. The commissioners have issued a directive to the parties concerned who are under obligation to respect it. The Commission's decision is available on the Competition Commission's website.

Statement from the Executive Director, Deshmuk Kowlessur:

« Le secteur des paris est réglementé et l’émission de nouvelles licences reste limitée. Dans de telles circonstances, il est par conséquent important que la concurrence prévale entre les détenteurs de licence existants. Il est essentiel d’avoir une compétition saine afin de s’assurer que les gains restent compétitifs, mais également que l’innovation soit favorisée dans ce secteur. L’acquisition d’un nombre important de licences par une entreprise peut présenter des risques pour la concurrence. Cette démarche peut par ailleurs entraver l’innovation et la dynamique du marché. Dans le cas présent, ma crainte était qu’il y ait une concentration des licences existantes, surtout pour les paris mutuels. Je tiens aussi à souligner mon appréciation au niveau de la collaboration avec les parties concernées et les engagements proposés, ce qui a permis d’accélérer le processus d’investigation pour permettre aux consommateurs et à l’économie de récolter plus rapidement les bénéfices de la concurrence. Nous avons également travaillé en étroite collaboration avec la Gambling Regulatory Authority sur cette investigation. Je suis convaincu que les engagements permettront de dynamiser le secteur des jeux qui autrement aurait pu être affecté. »