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Fluxx AG: Federal Competition Authority repeats warning to lottery companies

FLUXX AG / Miscellaneous



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The issuer is solely responsible for the content of this announcement.
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Federal Competition Authority repeats warning to lottery companies

- Termination of internet services null and void based on present status of
proceedings
- Shutdown of lottery platforms interpreted as circumvention of competition
authority's ruling

Altenholz, November 22, 2006 – The Federal Competition Authority has issued
the German lottery companies with a renewed warning about their
anti-competitive actions. The supreme German competition authority has
consequently extended the scope of the previous proceedings against the
lottery companies and confirms that most of the heads of State and Senate
Chancelleries (CdS) of the federal states have violated European
competition law. The gaming specialist FLUXX AG (ISIN DE000A0JRU67), of
Altenholz near Kiel, greatly welcomes the action of the Federal Competition
Authority.

After the Federal Competition Authority called for the lottery companies to
make their online gaming services available beyond the borders of the
respective states pursuant to its ruling of August 23, 2006, the CdS
resolved by a majority vote to request the state lottery companies to close
down their respective internet services. The Federal Competition Authority
evaluates this resolution as 'prohibited and null and void' on the grounds
that it violates European competition law, which takes precedence. In the
opinion of the Federal Competition Authority, the lottery companies may not
base the closing-down of their internet services on the CdS resolution. The
Federal Competition Authority's warning renders corresponding directives by
the regulatory authorities on the basis on the CdS resolution irrelevant.

According to the resolution of the Federal Competition Authority of August
23, 2006 and confirmed by the Higher Regional Court of Düsseldorf, both the
State Treaty on lotteries and corresponding state laws from which the
lottery companies deduce that it is prohibited to offer internet services
beyond the borders of a particular state are not applicable. The Federal
Competition Authority's resolution in particular declares the so-called
regionalism principle, which the federal states had collectively been using
to erect market barriers, to be not applicable. The Federal Competition
Authority has now applied this to the CdS resolution of November 6, 2006.
It has expressly reserved the right to impose fines.

In conclusion, the competition authority spells out in its of written
warning: 'To the extent that the lottery companies believe the Federal
Constitutional Court has called for the non-proliferation of gaming, the
deregulation of internet sales does not conflict with this.' In its
opinion, the BVerfG ruling applies exclusively to sports betting, an area
in which the lottery companies are offering an identical gaming service
through Oddset.

'As a citizen and entrepreneur, I find it annoying that the Federal
Competition Authority has to remind a few high-ranking government officials
that they are overstepping the mark,' commented Rainer Jacken, Management
Board spokesman of FLUXX AG. 'It is high time a few of those officials in
the federal states got to grips with European law and stopped being used by
those who are only interested in preserving their own power, at the expense
of German lotteries, the value of enterprises and the financing of sport,
culture and social activities. Put an end to this economic and political
chaos, and shelve the planned State Treaty on gaming!'
 
'We firmly expect the warning to result in our continued operation of the
online platforms of our lottery partners in Schleswig-Holstein,
Mecklenburg-Western Pomerania and Brandenburg on an unchanged basis,' added
Rainer Jacken. 'Sporting, cultural and charitable organisations can
moreover all breathe a sigh of relief once the lottery companies reopen
their internet services.' Lotto sales over the internet will reach around
200 million euros this year – around half of this total going to the
federal states themselves, which use it to fund such activities as mass
sport, culture and charities.       

FLUXX AG
Stefan Zenker
tel. +49 40 85 37 88 47
Mail: stefan.zenker@fluxx.com


DGAP 22.11.2006 
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Language:     English
Issuer:       FLUXX AG
              Ostpreußenplatz 10
              24161 Altenholz Deutschland
Phone:        +49 (0)431 88 104-0
Fax:          +49 (0)431 88 104-40
E-mail:       info@fluxx.com
WWW:          www.fluxx.com
ISIN:         DE000A0JRU67
WKN:          A0JRU6
Indices:      
Listed:       Geregelter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin-Bremen, Düsseldorf, Hamburg, München, Stuttgart
 
End of News                                     DGAP News-Service
 
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