Prague Secures Right to Enforce Local Gambling Rules in Landmark Constitutional Court Ruling

The Constitutional Court of the Czech Republic has affirmed the authority of Prague’s Magistrát (City Council) to implement gambling laws that reflect the specific needs and realities of its individual districts, allowing for restrictions or outright bans on live gambling within city boundaries.

The ruling upholds the city’s autonomy in regulatory matters, contrasting sharply with the Czech government’s preference for a centralised gambling oversight model.

Prague’s controversial 2021 city-wide ordinance, which banned all technical gambling games such as slot machines while permitting live dealer games like poker and roulette, is at the heart of the legal debate. The ordinance also granted the capital’s 57 districts the power to regulate live gambling as they saw fit—leading to 41 districts banning live games outright, while the remaining districts introduced specific time restrictions for gambling operations.

This decentralised approach prompted objections from national authorities. In 2023, the Czech Ministry of the Interior, supported by the Czech Competition Authority (ÚOHS), declared the ordinance invalid and discriminatory against gambling license holders. The Ministry argued that Prague's actions distorted the gambling market and violated national regulatory standards, temporarily suspending the ordinance.

However, in its latest ruling, the Constitutional Court has lifted the suspension and sided with Prague, confirming that local lawmakers have the right to tailor gambling restrictions based on the unique circumstances of their communities.

Justice Pavel Šámal, writing on behalf of the Court, emphasized the legitimacy of district-level regulations. “The Court recognises the right of city districts to determine their own regulatory methods as both legitimate and rational,” he stated.

The Ministry of the Interior had previously asserted that the entire city of Prague should adhere to a uniform gambling framework, maintaining that fragmented regulation was economically detrimental and inconsistent with national policy.

The Competition Authority echoed these concerns, noting that the city's regulatory fragmentation could infringe competition law, prompting a formal probe. Still, Prague maintained that its actions aligned with Czech legal provisions, specifically the Gambling Act revised in 2016, which grants municipalities the power to issue gambling ordinances.

The Constitutional Court accepted the city’s justification for distinguishing between gambling operators in various districts, concluding that the variations were not discriminatory. “The established restrictions met the requirements necessary to achieve regulatory objectives,” the ruling stated.

The decision was not without dissent. Justice Milan Hulmák issued a written opinion opposing the ruling, arguing against the inconsistency of regulation across districts. “I observe no logical or objective factors on Prague’s live gambling regulation map that could justify the complete regulatory divergence between different city regions,” Hulmák wrote.

Despite this disagreement, the Prague City Council has welcomed the Court’s support for its district-specific strategy. Officials reiterated that blanket regulations ignore the “distinct qualities of each neighbourhood,” stressing that certain districts have faced acute issues related to gambling addiction and associated crime.

The Court agreed that dividing the city into districts for regulatory reasons was not arbitrary.

It concluded that the varying rules in each district were “ordinary and necessary.”

Nonetheless, the ruling is expected to pose challenges for gambling operators. The Czech Competition Authority warned that the industry now faces a complex compliance landscape, with operators required to navigate a fragmented web of local laws. Many licence holders are already reassessing their presence across Prague’s various districts.

Beyond the capital, the ruling may embolden other municipalities throughout the Czech Republic’s 14 provinces to assert similar regulatory autonomy. As gambling policy continues to be a point of contention, this decision could shift the balance of power from the central government toward local authorities in shaping the future of the nation’s gambling framework.

By fLEXI tEAM