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On places where gaming is organised

Case No. 10/2009

THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA

RULING

ON THE COMPLIANCE OF PARAGRAPH 2 (WORDING OF 27 JUNE 2002) OF ARTICLE 10 (WORDING OF 25 NOVEMBER 2003) OF THE REPUBLIC OF LITHUANIA LAW ON GAMING WITH THE CONSTITUTION OF THE REPUBLIC OF LITHUANIA

21 June 2011
Vilnius

The Constitutional Court of the Republic of Lithuania, composed of the Justices of the Constitutional Court Egidijus Bieliūnas, Toma Birmontienė, Pranas Kuconis, Gediminas Mesonis, Ramutė Ruškytė, Egidijus Šileikis, Algirdas Taminskas, Romualdas Kęstutis Urbaitis, and Dainius Žalimas,

with the secretary—Sigutė Brusovienė,

in the presence of the representative of a group of Members of the Seimas of the Republic of Lithuania, the petitioner, who was Mantas Adomėnas, a Member of the Seimas,

in the presence of the representative of the Seimas, the party concerned, who was Žilvinas Šilgalis, a Member of the Seimas,

pursuant to Articles 102 and 105 of the Constitution of the Republic of Lithuania and Article 1 of the Law on the Constitutional Court of the Republic of Lithuania, in its public hearing on 9 June 2011, heard constitutional justice case No. 10/2009 subsequent to the petition of a group of Members of the Seimas, the petitioner, requesting to investigate whether Article 10 (wordings of 17 May 2001, 28 June 2001, 27 June 2002 and 25 November 2003) of the Republic of Lithuania Law on Gaming is not in conflict with Article 1, Paragraphs 2 and 3 of Article 46 of the Constitution of the Republic of Lithuania and the constitutional principle of a state under the rule of law.

The Constitutional Court

has established:

I

The petition of the group of Members of the Seimas, the petitioner, is substantiated by the following arguments.

According to the doctrine of the Constitutional Court, inter alia the Constitutional Court ruling of 4 July 2003, in a state under the rule of law the legislator has the right and duty to prohibit by means of laws such deeds that may essentially harm the interests of persons, society or the state or may pose a threat of such harm to appear. Paragraph 2 of Article 10 (wordings of 17 May 2001, 28 June 2001, 27 June 2002, and 25 November 2003) of the Law on Gaming provides a list of locations where it is prohibited to organise gaming, which is a finite one; however, the fact that one has not established therein the prohibition on the organisation of gaming in some other locations as well, is not constitutionally grounded, either. In the explanatory note to the Draft Law on Gaming one has also indicated a high risk that underage persons might be involved in gaming. Therefore, a threat of appearance of negative consequences of gaming may also arise in cases where gaming is organised in the vicinity of schools of general education.

A legal gap as well as the lack of legal regulation may be a ground to recognise a legal act as being in conflict with the Constitution. The legislator, having not established a prohibition on the organisation of gaming in places of mass gathering, in houses of prayer and their vicinity, as well as in the vicinity of education establishments, has failed to fulfil its duty to efficiently prohibit by means of laws the deeds that inflict essential harm on the interests of persons, society or the state or pose a threat of such harm to appear, and has violated Article 1, Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

II

In the course of the preparation of the case for the Constitutional Court hearing written explanations were received from the representative of the Seimas, the party concerned, who was Ž. Šilgalis, a Member of the Seimas. The position of the representative of the Seimas is substantiated by the following arguments.

While referring to the Constitutional Court doctrine, it is maintained that the Seimas, as the institution of legislative power, and the Government, as an institution of executive power, enjoy a very broad discretion to form and execute the economic policy of the state (Constitutional Court ruling of 2 March 2009).

As regards the great threat of involvement of underage persons in gaming, which is referred to by the petitioner, it is maintained that Paragraph 10 (wording of 27 June 2002) of Article 10 of the Law on Gaming contains an imperative norm prohibiting underage persons from gaming.

In the written explanations of the Member of the Seimas Ž. Šilgalis a conclusion is drawn that Article 10 (wordings of 17 May 2001, 28 June 2001, 27 June 2002 and 25 November 2003) of the Law on Gaming is not in conflict with the Constitution.

III

In the course of the preparation of the case for the Constitutional Court hearing written explanations were received from Robertas Kvietkovskis, Chairman of the State Gaming Control Commission (hereinafter also referred to as the Control Commission).

IV

At the Constitutional Court hearing, Ž. Šilgalis, the representative of the Seimas, the party concerned, virtually reiterated the arguments set forth in his written explanations and answered to questions of the justices.

The Constitutional Court

holds that:

I

1. The group of Members of the Seimas, the petitioner, does not indicate any concrete wording of Article 10 of the Law on Gaming, however, from the arguments of the petition of the petitioner it is clear that it has had doubts as to whether Article 10 (wording of 25 November 2003) of the Law on Gaming is not in conflict with the Constitution.

2. In the opinion of the petitioner, the legislator, having provided a finite list of locations in which it is prohibited to organise gaming, has failed to establish a prohibition on the organisation of gaming in some other concrete places as well, i.e. in places of mass gathering, in houses of prayer and their vicinity, as well as in the vicinity of education establishments. Therefore, according to the petitioner, such legal regulation is, in the said aspect, in conflict with Article 1, Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

Thus, the petitioner does not dispute the legal regulation established in Article 10 (wording of 25 November 2003) of the Law on Gaming, but it is disputing something that is not established therein, which, however, in the opinion of the petitioner, ought to be established namely in that article; therefore, in this situation virtually the issue of legislative omission is raised, i.e. such a gap in the legal regulation, which is prohibited by the Constitution.

3. It needs to be noted that the list of locations in which it is prohibited to organise gaming is not established throughout the whole Article 10 (wording of 25 November 2003) of the Law on Gaming, but in Paragraph 2 (wording of 27 June 2002) thereof.

4. Thus, subsequent to the petition of the group of Members of the Seimas, the petitioner, the Constitutional Court will investigate whether, in the aspect disputed by the petitioner, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is not in conflict with Article 1, Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

It needs to be noted that the legal regulation laid down in separate Items (Items 1–18) of Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is not a matter of investigation in the constitutional justice case at issue.

II

1. On 17 May 2001, the Seimas adopted the Law on Gaming, which, pursuant to Article 33 thereof, came into force on 1 July 2001. This law provides for the conditions and procedure for organisation of gaming in the Republic of Lithuania.

2. Paragraph 2 (wording of 27 June 2002) of Article 10 “Prohibitions and Restrictions on Organisation of Gaming” (wording of 25 November 2003) of the Law on Gaming, which in the aforementioned aspect is being disputed by the petitioner, prescribes:

Organisation of gaming shall be prohibited in the following locations:

1) in residential houses, excepting those, on the ground floors whereof according to the building and use plan, non-residential premises have been adapted for other activity and have the main entrance from the street side, which does not coincide with the stairwell entrance;

2) on the premises of pre-school teaching establishments;

3) on the premises of general education schools;

4) on the premises of vocational training establishments;

5) in schools of further education;

6) in schools of higher education;

7) in complementary teaching and non-formal educational establishments;

8) in health care establishments;

9) in children’s sanatoria;

10) in cultural establishments;

11) in libraries;

12) in theatres;

13) in museums and exhibition halls;

14) in credit establishments and other financial institutions;

15) in shops, except for setting up bookmaking and totalisator points in trade centres which are designed not only for shop activities and in which, observing the designated layout, separate premises are built;

16) in state and municipal institutions and establishments;

17) in cinemas, railway and bus stations, airports, and seaports, except machine gaming where it is organised on separate premises, not linked to the direct functions of these establishments;

18) on post office premises, except the bookmaking and totalisator points established thereon.”

3. It needs to be noted that in Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming one enumerates the places in which it is prohibited to organise gaming; most of these places are accessible to the public, i.e. they are to be treated as places of mass gathering, as, for instance: schools, sanatoria, museums and exhibition halls, theatres, cinemas, railway and bus stations, airports.

4. Paragraph 16 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming prescribes: “Other prohibitions and restrictions on organisation of gaming laid down in this and other laws of the Republic of Lithuania may also be applied.” Consequently, prohibitions on the organisation of gaming in certain other places may be also derived from the provisions of other articles of this law, as well as from other laws.

5. The legal regulation laid down in Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is also related with other provisions of this law (wording of 17 May 2001), as, for instance:

– “Licences to organise games shall be issued by the State Gaming Control Commission <...>” (Paragraph 1 of Article 4);

– “The Control Commission shall issue licences to open gaming machine halls, bingo facilities and gaming houses (casinos)” (Paragraph 1 of Article 21);

– “Permits to open gaming machine halls, bingo facilities and gaming houses (casinos) shall be issued to companies possessing licences to organise specific games of chance, or shall be issued together with these licences” (Paragraph 2 of Article 21);

– “Gaming houses (casinos) shall be established pending approval by the local municipal council” (Article 9).

It is also established that from the very day of the entry into force of the Law on Gaming the requirements (conditions) for organisation of gaming are also entrenched in Article 15 “Requirements for Premises of Gaming Machine Halls, Bingo Facilities and Gaming Houses (Casinos)” (wording of 17 May 2001 and 3 April 2003) of this law:

1. Gaming houses (casinos) and bingo facilities shall be set up on isolated premises having a separate entrance. The premises must be equipped with: <...>;

2) a digital visual recording system, operating continuously during gaming (if gaming is organised in a gaming house (casino)—the digital visual recording system must be installed above every table). The gaming organiser must retain the records for 180 days and submit them only to the Control Commission, the participants of a game who filed their claims, as well as <...>, prosecutors, or the court in accordance with the procedure prescribed by laws; <...>.

2. Gaming machine halls shall be set up on isolated premises having a separate entrance. <...>”

Thus, under the legal regulation established in the Law on Gaming (wording of 17 May 2001), gaming may be organised only on isolated premises having a separate entrance, therefore, one may not organise such games in any places of mass gathering in an open-space area.

6. Thus, the disputed legal regulation, which is established in Paragraph 2 (wording of 27 June 2002) of Article 10 “Prohibitions and Restrictions on Organisation of Gaming” (wording of 25 November 2003) of the Law on Gaming, when construed in the context of other indicated provisions of the same law, also means that this law must be also followed by institutions implementing the control over organisation of gaming:

when, according to the requirements of legal acts, a competent state establishment is issuing a license for such activity and granting a permit to open in a concrete place gaming machine halls, bingo facilities and gaming houses (casinos);

when a municipal council is deciding as to whether to give its assent to the founding of a gaming house (casino) in a concrete place (on the municipal territory).

7. It has been mentioned that Paragraph 16 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming prescribes that the prohibitions on organisation of gaming that are set in other laws may also be applied. In this context one needs to mention the provisions of the following laws.

7.1. Paragraph 1 of Article 8 of the Republic of Lithuania Law on Religious Communities and Associations (wording of 4 October 1995) prescribes: “Religious rites and cult ceremonies shall be freely performed on cult premises and in their vicinity, <...>.”

7.2. Article 4 of the Republic of Lithuania Law on Local Self-government (wording of 15 September 2008) sets the principles on which local self-government is based, as, for instance:

adjustment of municipal and State interests when managing public affairs of municipalities (Item 7);

adjustment of interests of the community and individual residents of a municipality (Item 8);

publicity and responsiveness to the opinion of the residents of a municipality (Item 11);

assurance of and respect for human rights and freedoms (Item 12).

7.3. The Republic of Lithuania Law on the Protection of Minors Against the Detrimental Effect of Public Information (wording of 14 July 2009) prescribes:

– “The following public information shall be attributed to information which has a detrimental effect on minors: <...> 6) which promotes gambling, encourages or offers to take part in gambling and other games which create an impression of an easy gain; <...>” (Paragraph 2 (wording of 22 December 2009) of Article 4);

– “It shall be prohibited to directly disseminate to minors the information, which has a detrimental effect on them—to offer to minors, to transfer or otherwise to permit personal use of such information. Such public information may be made available to the public only in places which are inaccessible to minors and/or during such times when minors would not be able to access it, or when, by employing technical measures, conditions are created for persons responsible for the upbringing and care of children to ensure the possibility of limiting the supply of such public information to minors” (Paragraph 1 (wording of 22 December 2009) of Article 7).

7.4. Item 1 (wording of 14 October 2008) of Paragraph 3 of Article 18 of the Republic of Lithuania Law on Alcohol Control prescribes: “In the Republic of Lithuania, the sale of alcoholic beverages shall be prohibited: in <...>, teaching establishments and areas thereof, also in the vicinity of these establishments and houses of prayer (at a distance specified by the municipal council subject to co-ordination respectively with the heads of these institutions and religious communities)”.

8. Thus, prohibitions on the organisation of gaming in certain places may be also derived from the provisions of other articles of the Law on Gaming, as well as from other laws (as, for instance, the Law on Religious Communities and Associations (wording of 4 October 1995), the Law on Local Self-government (wording of 15 September 2008), the Law on the Protection of Minors Against the Detrimental Effect of Public Information (wording of 14 July 2009), and the Law on Alcohol Control (wording of 14 October 2008).

III

1. Subsequent to the petition of the group of Members of the Seimas, the petitioner, the Constitutional Court is investigating whether, in the aspect disputed by the petitioner, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is not in conflict with Article 1, Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

2. In its acts the Constitutional Court has formulated a broad official constitutional doctrine of freedom of economic activity (inter alia Constitutional Court rulings of 13 February 1997, 13 May 2005 and 6 January 2011).

The provision “the State shall support economic efforts and initiative which are useful to society” of Paragraph 2 of Article 46 of the Constitution means, first of all, the possibility consolidated by the Constitution for the state institutions to assess spheres of economic activity as to their benefit for society; secondly, only on the basis of such an assessment and grouping it is possible to realise the consolidated right of supporting particular spheres of economic activity or particular economic efforts; finally, the said assessment of economic activity constitutes necessary preconditions to implement the provision of Paragraph 3 of Article 46 of the Constitution, which reads: “The State shall regulate economic activity so that it serves the general welfare of the Nation”; one of the most important emphases of this provision is a possible differentiated legal regulation of economic activity, the main criterion whereof is a general welfare of the nation; it is a rather general and broad criterion and in its application one may base oneself on the concept of general welfare as well as the arguments of purposiveness (Constitutional Court ruling of 13 February 1997).

Thus, it would be incorrect to comprehend the quoted provision of Article 46 of the Constitution as the duty of the state to decisively support any economic efforts or activity; on the contrary, as it has been mentioned, in this situation the state has the opportunity of choice; on the other hand, the welfare of the nation may not be understood only in material (financial) sense; furthermore, hardly would it be fair and moral to seek material welfare in such a way which is harmful to people’s health (Constitutional Court ruling of 13 February 1997).

It needs to be noted that the Constitutional Court has held that the health of a human being and of society is one of the most important values of society (Constitutional Court rulings of 11 July 2002, 29 September 2005 and 2 September 2009), also that protection of people’s health is a constitutionally important objective, a public interest, whereas looking after people’s health is to be treated as a state function (Constitutional Court rulings of 14 January 2002, 26 January 2004, 29 September 2005 and 2 September 2009). Therefore, the limitation of economic activity whereby one seeks to protect people’s health is to be treated as one designated to ensure the general wealth of the nation and, in itself, if requirements arising from the Constitution are paid heed to, is not to be held as violating the Constitution (Constitutional Court ruling of 29 September 2005).

As the Constitutional Court has held in its acts more than once, the provision “The State shall regulate economic activity so that it serves the general welfare of the Nation” (Paragraph 3 of Article 46 of the Constitution) enshrines the constitutional principle which outlines the objectives, directions, ways and boundaries of the regulation of economic activity. While regulating economic activity, the state has to follow the principle of coordination of interests of the person and society and has to guarantee the interests of both the private person (a subject of economic activity) and society (inter alia Constitutional Court rulings of 13 May 2005, 5 March 2008, 2 March 2009, 26 February 2010 and 6 January 2011).

As a rule, regulation of economic activity is linked with establishment of conditions for economic activity, regulation of certain procedures, control of economic activity, as well as with certain limitations and prohibitions on this activity (inter alia Constitutional Court rulings of 13 May 2005, 5 March 2008, 8 October 2009, 26 February 2010 and 6 January 2011); when a person participates in an economic activity, special limitations which are established by laws can be applied to him (Constitutional Court rulings of 13 May 2005 and 31 May 2006).

In its ruling of 31 May 2006 (also in the rulings of 26 September 2006 and 21 December 2006) the Constitutional Court held that the legal pre-conditions of differentiated legal regulation (when account is taken of the importance and nature of the regulated relations) originate from the Constitution itself (inter alia Paragraph 2 of Article 46 of the Constitution), the differentiated establishment of the legal situation of separate economic entities is to be related with the objectives raised by the state in a certain sector of economy, the striving to arrange the economy of the country in a corresponding manner, besides, due to a specific character, variety and dynamism of economic activity, regulation of concrete relations in this area cannot be the same all the time, the ratio of prohibitions and permissions is subject to change inter alia while seeking to ensure the public interest.

3. The Seimas, as the institution of legislative power, and the Government, as an institution of executive power, enjoy a very broad discretion to form and execute the economic policy of the state (Constitutional Court rulings of 31 May 2006, 21 December 2006, 30 June 2008 and 2 March 2009).

4. In Constitutional Court acts it has been stated more than once that freedom of economic activity is not absolute.

It also needs to be noted that, as in its acts the Constitutional Court has held more than once that, according to the Constitution, it is permitted to limit the rights and freedoms of a person, including freedom of economic activity, provided that the following conditions are observed: this is done by law; the limitations are necessary in a democratic society in order to protect the rights and freedoms of other persons and the values entrenched in the Constitution, as well as the constitutionally important objectives; the limitations do not deny the nature and essence of the rights and freedoms; the constitutional principle of proportionality is observed (inter alia Constitutional Court rulings of 26 January 2004, 13 May 2005 and 26 February 2010).

5. In the Constitutional Court ruling of 2 March 2009 it was held that internal harmony of the legal system, which is implied by the constitutional principle of a state under the rule of law, is inter alia linked to the legal gaps, i.e. lack of legal regulation, inter alia legislative omission.

The Constitutional Court has held that a legal gap, inter alia legislative omission, always means that the legal regulation of corresponding social relations is established neither explicitly, nor implicitly, neither in a certain legal act (part thereof), nor any other legal acts at all, even though there exists a need for legal regulation of these social relations, while the said legal regulation, in case of legislative omission, must be established precisely in that legal act (precisely in that part thereof), since this is required by a certain legal act of higher power, inter alia the Constitution itself (Constitutional Court decisions of 8 August 2006, 5 November 2008, rulings of 2 March 2009, 22 June 2009 and 29 November 2010).

6. Article 1 of the Constitution prescribes: “The State of Lithuania shall be an independent democratic republic.” In Article 1 of the Republic of Lithuania Constitutional Law “On the State of Lithuania”—the constituent part of the Constitution—it is consolidated that the statement “The State of Lithuania shall be an independent democratic republic” is a constitutional norm of the Republic of Lithuania and a fundamental principle of the State. When construing the provision of Article 1 of the Constitution, the Constitutional Court held that in this article of the Constitution the fundamental principles of the State of Lithuania are established: the State of Lithuania is a free and independent state; the republic is the form of governance of the State of Lithuania; the state power must be organised in a democratic way, and there must be a democratic political regime in this country (Constitutional Court rulings of 23 February 2000, 18 October 2000, 19 September 2002 and 13 December 2004).

It needs to be noted that by the laws or other legal acts that conflict with the Constitution one violates the principle of supremacy of the Constitution as well as other constitutional values, and by such aforesaid laws and legal acts one might also encroach upon the elements of democracy entrenched in the Constitution; however, in itself the statement that a law or other legal act conflicts with the Constitution does not mean that the provision of Article 1 of the Constitution that the State of Lithuania shall be democratic is violated (Constitutional Court ruling of 19 September 2002).

7. In the context of the constitutional justice case at issue, from the Constitution, inter alia Articles 46 and 53 thereof, there arises a requirement that, while regulating the relations of economic activity in the area of organisation of gaming and by taking account of the fact that organisation of gaming may cause negative consequences for people’s health, public order and the security of members of society, as well as for other values which are protected and defended by law, the legislator must establish the bases for organisation of gaming as an economic activity, also that the legislator may, and in certain situations also must, establish the limitations and prohibitions on the activity of organisation of gaming, inter alia provide for the cases where gaming activities are limited, as well as prohibit these activities in certain places on the whole.

In this context it needs to be noted that Paragraph 2 of Article 120 of the Constitution provides that municipalities shall act freely and independently within the competence defined by the Constitution and laws; the independence of municipalities and freedom of their activities within the competence defined by the Constitution and laws are constitutional principles (Constitutional Court ruling of 24 December 2002). The provision of the Constitution that municipalities shall act freely and independently within their competence defined by the Constitution and laws is to be assessed as the guarantee of the participation of these communities in the governance of these territories (Constitutional Court rulings of 28 June 2001, 14 January 2002, 24 December 2002, 30 May 2003 and 13 December 2004).

Thus, the legislator, by following the Constitution, inter alia Paragraph 2 of Article 120 and Article 46 thereof, may confer on municipal councils the right to adopt a concrete decision regarding the permission to organise gaming in their local territory on the grounds established in laws.

Alongside, it needs to be noted that from the Constitution, inter alia Article 46 thereof as well as the constitutional principle of a state under the rule of law, there arises a requirement that respective decisions of municipal councils be clearly substantiated and rationally reasoned, and that these decisions may not discriminate against any persons, nor grant any privileges to any persons.

IV

1. In the context of the constitutional justice case at issue it needs to be noted that certain relations connected with organisation of gaming as an economic activity in certain aspects also constitute a matter of regulation within European Union law.

2. It needs to be noted that, on 8 May 2008, the Seimas adopted the Republic of Lithuania Law on Ratifying the Treaty of Lisbon Amending the Treaty on the European Union and the Treaty Establishing the European Community. The Treaty Establishing the European Community (the title whereof after the entry into force of the Treaty of Lisbon on 1 December 2009 was replaced by the title “The Treaty on the Functioning of the European Union”), as partially amended by the Treaty of Lisbon Amending the Treaty on the European Union and the Treaty Establishing the European Community, has inter alia consolidated the freedom of establishment and the freedom to provide services.

3. The said freedoms entrenched in the Treaty on the Functioning of the European Union (formerly referred to as the Treaty Establishing the European Community) have been construed by the Court of Justice of the European Union (formerly referred to as the Court of Justice of the European Communities; hereinafter also referred to as the ECJ) in cases connected with the limitations and prohibitions relating to organisation of gaming.

4. The regulation of organisation of gaming is one of the areas in which there are moral, religious and cultural differences between the Member States. In the absence of harmonised provisions of the European Union (European Community) in the field, it is for each Member State to determine in those areas, in accordance with its own scale of values, what is required in order to ensure that the interests in question are protected (ECJ judgement of 8 September 2009 in Case C‑42/07 (Liga Portuguesa de Futebol Profissional and Bwin International), Paragraphs 5758; judgement of 8 July 2010 in Joined Cases C-447/08 and C-448/08 (Otto Sjöberg, Anders Gerdin), Paragraphs 3738).

5. It is for each Member State to assess whether, in the context of the legitimate aims which it pursues, it is necessary wholly or partially to prohibit activities of that nature (organisation of gaming), or only to restrict them and to lay down more or less strict supervisory rules for that purpose (ECJ judgement of 21 September 1999 in Case C‑124/97 (Läärä etc.), Paragraphs 35–36; judgement of 21 October 1999 in Case C‑67/98 (Zenatti), Paragraphs 33–34; judgement of 8 September 2009 in Case C‑42/07 (Liga Portuguesa de Futebol Profissional and Bwin International), Paragraph 58; judgement of 8 September 2010 in Case C-46/08 (Carmen Media Group Ltd v. Land Schleswig-Holstein, Innenminister des Landes Schleswig-Holstein), Paragraph 46).

6. Each Member State retains the right to require any operator wishing to offer games of chance to consumers in its territory to hold an authorisation issued by its competent authorities, without the fact that a particular operator already holds an authorisation issued in another Member State being capable of constituting an obstacle (ECJ judgement of 8 September 2010 in Joined Cases C-316/07, C-358/07, C-360/07, C-409/07 and C-410/07 (Markus Stoß, Avalon Service‑Online‑Dienste GmbH, Olaf Amadeus Wilhelm Happel v. Wetteraukreis and Kulpa Automatenservice Asperg GmbH, SOBO Sport & Entertainment GmbH, Andreas Kunert v. Land Baden‑Württemberg), Paragraph 113).

7. It needs to be noted that the jurisprudence of the Court of Justice of the European Union as a source of construction of law is also important to construction and application of Lithuanian law (Constitutional Court rulings of 21 December 2006, 15 May 2007, 4 December 2008 and 27 March 2009).

8. In this context it needs to be noted that the legal regulation applicable to gaming varies between the Member States of the European Union.

For instance, under the Kingdom of Belgium Act on Games of Chance, Gambling Establishments and the Protection of Players, which was adopted on 7 May 1999, in Belgium establishment of nine gaming houses (casinos) at maximum is allowed with not more than one gaming house (casino) in each of the nine municipalities enumerated in the said act. Under the Republic of Latvia Law on Gambling and Lotteries (with amendments), adopted on 17 November 2005, in Latvia, if the organisation of gaming in a concrete place essentially infringes on the interests of the State as well as the legitimate interests and rights of inhabitants of the relative administrative territory the municipality council has the right to adopt a reasoned decision to revoke the granted permission for the establishment of a gaming house (casino), gaming machine hall or bingo hall, or for the organisation of bookmaking in a concrete place (such gaming houses, gaming machine or bingo halls, or bookmaking points must terminate their activities within 5 years from the date the relative decision of the municipality council came into force).

9. It needs to be noted that it is scientifically proven that participation in gaming can also cause a lot of negative consequences; in the International Statistical Classification of Diseases and Health Problems applied by the World Health Organisation it is indicated that habit and impulse disorders include the pathological impulse to gamble; in addition, gambling and betting, as well as tobacco use and alcohol use, are to be ascribed to problems related to lifestyle.

V

On the compliance of Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming with Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

1. It has been mentioned that subsequent to the petition of the group of Members of the Seimas, the petitioner, the Constitutional Court is investigating whether, in the aspect disputed by the petitioner, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is not in conflict with Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

2. As mentioned, in the opinion of the petitioner, the legislator, having provided a finite list of locations in which it is prohibited to organise gaming, has failed to establish a prohibition on the organisation of gaming in some other concrete places as well, inter alia in places of mass gathering.

2.1. It has also been mentioned that in Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming one enumerates places in which it is prohibited to organise gaming; most of these places are to be treated as places of mass gathering, as, for instance: schools, sanatoria, museums and exhibition halls, theatres, cinemas, railway and bus stations, airports.

It has also been mentioned that Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming does not provide for a finite list of locations in which it is prohibited to organise gaming; the prohibitions on the organisation of gaming in certain other places may be also derived from inter alia other provisions of this law.

2.2. In this context it needs to be noted that, as mentioned, from the very day of the entry into force of the Law on Gaming the requirements (conditions) for organisation of gaming have also been entrenched in Article 15 “Requirements for Premises of Gaming Machine Halls, Bingo Facilities and Gaming Houses (Casinos)” (wording of 17 May 2001 and 3 April 2003) of this law:

1. Gaming houses (casinos) and bingo facilities shall be set up on isolated premises having a separate entrance. The premises must be equipped with: <...>;

2) a digital visual recording system, operating continuously during gaming (if gaming is organised in a gaming house (casino)—the digital visual recording system must be installed above every table). The gaming organiser must retain the records for 180 days and submit them only to the Control Commission, the participants of a game who filed their claims, as well as <...>, prosecutors, or the court in accordance with the procedure prescribed by laws; <...>.

2. Gaming machine halls shall be set up on isolated premises having a separate entrance. <...>”

Thus, under the legal regulation established in the Law on Gaming (wording of 17 May 2001), gaming may be organised only on isolated premises having a separate entrance, therefore, one may not organise such games in any places of mass gathering in an open-space area.

3. Consequently, in the Law on Gaming (wording of 25 November 2003) one has established the corresponding prohibitions on the organisation of gaming in places of mass gathering.

4. It has been mentioned that the group of Members of the Seimas, the petitioner, maintains that the legislator, having not established the prohibition on the organisation of gaming in inter alia houses of prayer and their vicinity, has failed to fulfil its duty to efficiently prohibit by means of laws the deeds that may essentially harm the interests of persons, society or the state, or may pose a threat of such harm to appear, and has violated Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

4.1. As it has been mentioned, Paragraph 16 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming prescribes that the prohibitions on organisation of gaming that are set in other articles of this law as well as in other laws may also be applied.

It has also been mentioned that, under Paragraph 1 of Article 8 of the Law on Religious Communities and Associations (wording of 4 October 1995), religious rites and cult ceremonies shall be freely performed on cult premises and in their vicinity.

It needs to be held that by the said provision of the law one is, first of all, obligated not to violate the opportunity of a religious organisation, community or association to freely perform religious rites and cult ceremonies in cult houses themselves. In addition, it needs to be held that the aforesaid provision of the law also obligates one to take account of the circumstance that religious organisations, communities or associations, while freely performing their religious rites and cult ceremonies, may use not only the cult houses, but also the space in their vicinity.

Thus, a conclusion is to be drawn that the Control Commission, when deciding as to whether to give permission for the establishment of a totalisator or bookmaking point, or a gaming machine or bingo hall, or a gaming house (casino), as well as the municipal council, when deciding as to whether to grant its assent to the establishment of a gaming house (casino), are obliged to take account of the requirements stemming from the said law.

Alongside it needs to be mentioned that in Paragraph 3 of Article 43 of the Constitution the following is explicitly entrenched: “Churches and religious organisations shall be free to proclaim their teaching, perform their practices, and have houses of prayer, charity establishments, and schools for the training of the clergy.”

Paragraph 3 of Article 43 of the Constitution is designated to guarantee the independence of churches and religious organisations, to protect them against interference of state and local government institutions, their officials, and other establishments with the activity of churches and religious organisations (Constitutional Court ruling of 13 June 2000).

It needs to be noted that the provision of Paragraph 5 of Article 43 of the Constitution “the status of churches and other religious organisations in the State shall be established by agreement or by law” may not be interpreted as an obligation of the state to make respective agreements with all churches and religious organisations traditional in Lithuania, also with other churches and religious organisations recognised by the state; the state freely decides regarding entering into respective agreements or not, and if to be entered, whom they will be entered with; the said constitutional provision may not be also interpreted in such a way that once the state has entered into a specific agreement with a certain church or a religious organisation, it has to enter into respective agreements with other churches and religious organisations acting in Lithuania (Constitutional Court decision of 6 December 2007).

4.2. Thus, both the Control Commission, by following Article 43 of the Constitution and taking account of Article 8 of the Law on Religious Communities and Associations (wording of 4 October 1995), before resolving to give permission for the establishment of a totalisator or bookmaking point, or a gaming machine or bingo hall, or a gaming house (casino), and the municipal council, before resolving to grant its assent to the establishment of a gaming house (casino) in a concrete place, must also assess whether the intended gaming establishments could prove a hindrance to churches and religious organisations to freely proclaim their teaching and perform their practices, i.e. the Control Commission and the municipal council are not allowed to adopt any decision whereby one would be permitted to carry out gaming activities and at the same time would be given an opportunity to hinder churches and religious organisations from freely proclaiming their teaching and performing their practices.

4.3. It also needs to be noted that, as mentioned, under Item 1 (wording of 14 October 2008) of Paragraph 3 of Article 18 of the Law on Alcohol Control, in the Republic of Lithuania the sale of alcoholic beverages is prohibited inter alia in the vicinity of houses of prayer (at a distance specified by the municipal council subject to co-ordination respectively with religious communities).

In this context it needs to be noted that, under Paragraph 6 (wording of 17 May 2001) of Article 10 of the Law on Gaming, on premises where machine gaming, bingo, table games of chance are organised, the activity of inter alia restaurants and pubs, where, as a rule, alcoholic beverages are sold, is not prohibited.

While taking account of the fact that the organisation of gaming, as well as the sale of alcoholic beverages, is an economic activity that may lead to negative social consequences, the municipal council, before granting its assent to the establishment of gaming houses (casinos) in the vicinity of houses of prayer, must also pay heed to the requirements of the Law on Alcohol Control.

4.4. In this context it needs to be noted that, as mentioned, the local municipal council, before granting its assent to the establishment of a gaming house (casino) in a concrete place, must also heed the principles specified in Article 4 of the Law on Local Self-government (wording of 15 September 2008), on which local self-government is based, as, for instance: adjustment of municipal and State interests when managing public affairs of municipalities (Item 7); adjustment of interests of the community and individual residents of a municipality (Item 8); publicity and responsiveness to the opinion of the residents of a municipality (Item 11); assurance of and respect for human rights and freedoms (Item 12).

5. Consequently, the Law on Gaming (wording of 25 November 2003), the Law on Religious Communities and Associations (wording of 4 October 1995), the Law on Alcohol Control (wording of 14 October 2008) and the Law on Local Self-government (wording of 15 September 2008) establish the corresponding prohibitions on the organisation of gaming in houses of prayer and their vicinity.

6. It has been mentioned that the petitioner maintains that the legislator, having not established the prohibition on the organisation of gaming inter alia in the vicinity of education establishments, has failed to fulfil its duty to efficiently prohibit by means of laws the deeds that inflict essential harm on the interests of persons, society or the state or pose a threat of such harm to appear, and has violated Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

6.1. As mentioned, under Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming, it is prohibited to organise gaming inter alia in pre-school teaching establishments, general education schools, vocational training establishments, schools of further education, schools of higher education, complementary teaching and non-formal education establishments, and children’s sanatoria.

It needs to be noted that Paragraph 10 (wording of 27 June 2002) of Article 10 of the Law on Gaming inter alia prescribes: “Persons who are under 18 years of age shall be prohibited from participating in gaming. <...> Persons under 21 years of age shall be refused entrance to the gaming house (casino). <...> The gaming organiser must ensure compliance with the above requirements.”

6.2. It has been mentioned that the Law on the Protection of Minors Against the Detrimental Effect of Public Information (wording of 14 July 2009) inter alia prescribes:

– “The following public information shall be attributed to information which has a detrimental effect on minors: <...> 6) which promotes gambling, encourages or offers to take part in gambling and other games which create an impression of an easy gain; <...>” (Paragraph 2 (wording of 22 December 2009) of Article 4);

– “It shall be prohibited to directly disseminate to minors the information, which has a detrimental effect on them—to offer to minors, to transfer or otherwise to permit personal use of such information. Such public information may be made available to the public only in places which are inaccessible to minors and/or during such times when minors would not be able to access it, or when, by employing technical measures, conditions are created for persons responsible for the upbringing and care of children to ensure the possibility of limiting the supply of such public information to minors” (Paragraph 1 (wording of 22 December 2009) of Article 7).

6.3. Thus, the aforementioned prohibitions and limitations set in Paragraphs 2 and 10 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming inter alia mean that the legislator has established the corresponding limitations that underage persons be not involved in gaming, while the aforesaid provisions of the Law on the Protection of Minors Against the Detrimental Effect of Public Information have consolidated the additional prohibitions and limitations by means of which inter alia it is also sought that underage persons be not involved in gaming.

6.4. As mentioned, under Item 1 (wording of 14 October 2008) of Paragraph 3 of Article 18 of the Law on Alcohol Control, in the Republic of Lithuania the sale of alcoholic beverages is prohibited inter alia in teaching establishments and areas thereof, also in the vicinity of these establishments (at a distance specified by the municipal council subject to co-ordination respectively with the heads of these institutions).

In this context it needs to be noted that, as mentioned, under Paragraph 6 (wording of 17 May 2001) of Article 10 of the Law on Gaming, on premises where machine gaming, bingo, or table games of chance are organised, the activity of inter alia restaurants and pubs, where, as a rule, alcoholic beverages are sold, is not prohibited.

While taking account of the fact that the organisation of gaming, as well as the sale of alcoholic beverages, is an economic activity that may lead to negative social consequences, the municipal council, before granting its assent to the establishment of gaming houses (casinos) in the vicinity of education establishments, must also pay heed to the requirements set in the Law on Alcohol Control.

6.5. In this context it needs to be noted that, as mentioned, the local municipal council, before granting its assent to the establishment of a gaming house (casino) in a concrete place, must also heed the principles specified in Article 4 of the Law on Local Self-government (wording of 15 September 2008), on which local self-government is based, as, for instance: adjustment of municipal and State interests when managing public affairs of municipalities (Item 7); adjustment of interests of the community and individual residents of a municipality (Item 8); publicity and responsiveness to the opinion of the residents of a municipality (Item 11); assurance of and respect for human rights and freedoms (Item 12).

Thus, by following Article 9 (wording of 17 May 2001) of the Law on Gaming, which stipulates that “Gaming houses (casinos) shall be established pending approval by the local government council”, the municipal council must pay heed to the legal regulation established in the aforementioned laws and, when deciding on whether to grant its assent to the establishment of a gaming house (casino) in a concrete place located in the vicinity of an education establishment, the municipal council must also pay heed to the limitations set in those laws.

7. Consequently, the Law on Gaming (wording of 25 November 2003), the Law on the Protection of Minors Against the Detrimental Effect of Public Information (wording of 14 July 2009), the Law on Alcohol Control (wording of 14 October 2008) and the Law on Local Self-government (wording of 15 September 2008) establish the corresponding prohibitions on the organisation of gaming in the vicinity of education establishments.

8. As mentioned, in the constitutional justice case at issue one is disputing not the legal regulation laid down in Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming, but one is disputing something that is not established therein, which, however, in the opinion of the petitioner, ought to be established namely in that paragraph; therefore, in this situation virtually the issue of legislative omission is raised, i.e. such a gap in the legal regulation, which is prohibited by the Constitution. Thus, according to the petitioner, such legal regulation is in conflict with Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

It has been mentioned that the Constitutional Court has held that a legal gap, inter alia legislative omission, always means that the legal regulation of corresponding social relations is established neither explicitly, nor implicitly, neither in a certain legal act (part thereof), nor any other legal acts, even though there exists a need for legal regulation of these social relations, while the said legal regulation, in the case of legislative omission, must be established precisely in that legal act (precisely in that part thereof), since this is required by a certain legal act of higher power, inter alia the Constitution itself.

It has also been mentioned that the petitioner maintains that the list of places where it is prohibited to organise gaming, which is provided in Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming, is a finite one. Thus, the petitioner holds that the prohibition on the organisation of gaming in places of mass gathering, in houses of prayer and their vicinity, and in the vicinity of education establishments is not established, and that such legal regulation is in conflict with the Constitution.

In this ruling it has been held that Paragraph 16 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming prescribes that the prohibitions on organisation of gaming that are set in other articles of this law as well as those set in other laws may also be applied.

In this ruling it has also been held that the corresponding prohibitions and limitations on organisation of gaming arise not only from the Law on Gaming, but from other laws, as well:

the Law on Gaming (wording of 25 November 2003) sets the corresponding prohibitions on the organisation of gaming in places of mass gathering;

the Law on Gaming (wording of 25 November 2003), the Law on Religious Communities and Associations (wording of 4 October 1995), the Law on Alcohol Control (wording of 14 October 2008) and the Law on Local Self-government (wording of 15 September 2008) establish the corresponding prohibitions on the organisation of gaming in houses of prayer and their vicinity;

the Law on Gaming (wording of 25 November 2003), the Law on the Protection of Minors Against the Detrimental Effect of Public Information (wording of 14 July 2009), the Law on Alcohol Control (wording of 14 October 2008) and the Law on Local Self-government (wording of 15 September 2008) establish the corresponding prohibitions on the organisation of gaming in the vicinity of education establishments.

Thus, a conclusion is to be drawn that there is no ground to maintain that, under the Constitution, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming had to establish the prohibitions on the organisation of gaming in places of mass gathering, in houses of prayer and their vicinity, as well as in the vicinity of education establishments.

Consequently, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming, to the extent specified by the petitioner, does not contain any legislative omission, i.e. there is no legal gap there which is prohibited by the Constitution.

Thus, there is no ground to maintain that, in the aspect disputed by the petitioner, Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is in conflict with Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

9. Taking account of the arguments set forth, one is to draw a conclusion that Paragraph 2 (wording of 27 June 2002) of Article 10 (wording of 25 November 2003) of the Law on Gaming is not in conflict with Article 1 and Paragraphs 2 and 3 of Article 46 of the Constitution and the constitutional principle of a state under the rule of law.

Conforming to Articles 102 and 105 of the Constitution of the Republic of Lithuania and Articles 1, 53, 54, 55, and 56 of the Law on the Constitutional Court of the Republic of Lithuania, the Constitutional Court of the Republic of Lithuania has passed the following

ruling:

To recognise that Paragraph 2 (wording of 27 June 2002; Official Gazette Valstybės žinios, 2001, No. 43-1495; 2002, No. 72-3010) of Article 10 (wording of 25 November 2003; Official Gazette Valstybės žinios, 2003, No. 116-5249) of the Republic of Lithuania Law on Gaming is not in conflict with the Constitution of the Republic of Lithuania.

This ruling of the Constitutional Court is final and not subject to appeal.

The ruling is promulgated in the name of the Republic of Lithuania.

Justices of the Constitutional Court: Egidijus Bieliūnas
                                                                      Toma Birmontienė
                                                                      Pranas Kuconis
                                                                      Gediminas Mesonis
                                                                      Ramutė Ruškytė
                                                                      Egidijus Šileikis
                                                                      Algirdas Taminskas
                                                                      Romualdas Kęstutis Urbaitis
                                                                      Dainius Žalimas