Novamedia European Gaming & Lottery Files Belgium

Version: 26032003

Editor: Franka Pals

Authors: Rob van der Gaast, Franka Pals

Publisher: Novamedia

Disclaimer: Novamedia disclaims all liability for information provided within the "Novamedia European Gaming and Lottery Files".The information is supplied by independent journalistic sources. No parts of these files may be reproduced in any form by print, photo print, microfilm or otherwise, or re-distributed electronically in any form without written permission from the publisher.

Contents

  1. GENERAL INFORMATION
    The jurisdiction
  2. KEY FIGURES
    Population, Age structure, Currency, GDP, Internet, Telephones
  3. LEGISLATION
    1. Tasks of the National Lottery
    2. Supervising the National Lottery
    3. Closing remarks
    4. Gaming Board
  4. OPERATORS
    1. Nationale Loterij/Loterie Nationale
      1. History
      2. Products in 2000
      3. New products in 2000
      4. New products in 2001
      5. New products in 2002
      6. Key financials
      7. 2000 and 2001
      8. Highlights 2002 and first quarter 2003
      9. Grants
      10. Revenue allocation
      11. Sponsoring
    2. New lottery terminals
    3. Casinos
    4. Regulator
    5. Horse betting

1. General Information

Map of Europe, Belgium

 

The constitutional Kingdom of Belgium, situated in North-Western Europe, is bordered in the North by the Netherlands and the North Sea, in the East by Germany and the Grand Duchy of Luxembourg and in the West and South-West by France. Although the king, Albert II, (chief of state) is technically the source of all executive authority, the Council of Ministers (cabinet) actually makes all governmental decisions.

The Dutch speaking Flemish call their country 'België' and the French speaking Walloons call it 'La Belgique'. In Belgium, legally bilingual, Dutch is spoken by 58% and French by 32%. German is spoken by 10% of the inhabitants in the East of Belgium, neighboring Germany.

This language partition, North versus South opposition and the always present social­economic conflict, has led in recent years to constitutional amendments granting these regions formal recognition and autonomy. Brussels is the capital of Belgium and the capital of the European Union as well. Also the headquarters of NATO resides in Brussels. The harbor city Antwerp is the main commercial center of Belgium. Other famous cities include Ghent and Liege, where style, culture and history predominates. Internationally well-known Belgians are the comic strip figures Tintin, his dog Snowy, The Thomsons and opera singer Bianca CastaFiore. The adventures of Tintin are translated in more than 50 languages! Another comical man is Bobbejaan Schoepen. This singer/entertainer used to perform as a cowboy (even in the USA), which became his theme for a great, international family attraction park: Bobbejaanland.

Furthermore, Belgium is the home of many famous international professional race cyclists and, of course, it is famous for its many different types of splendid beers, French fries and superb family restaurants.

An economic union between Belgium and Luxembourg, formed in 1921 (the first of its kind in 20th-century Europe), was superseded in 1958 by the BeNeLux Economic Union, which also includes the Netherlands and Luxembourg. This was the predecessor of a united Europe.

The history of the Belgium Stock exchange goes back to the 2nd of July 1801 when there was the incorporation of the 'Bourse de Fonds public et de change de Bruxelles' by Napoleon and on January 1st, 1991, there was another incorporation: Euronext Brussels (BSE).

Euronext was created by the merger of the exchanges in Amsterdam, Brussels, Paris and - later - Portugal, in response to growing demand from the market, a political environment favorable to further consolidation in the European capital market, and a desire to capitalize on greater liquidity and lower costs resulting from the introduction of the Euro.

Euronext is the first fully integrated, crossborder, European market for equities, bonds, derivatives and commodities.

Traditionally Belgium has an open economy, highly dependent on imports and international trade. Both the federal and the regional governments encourage foreign investment on a national treatment basis. There is a friendly, mild tax climate.

2. Key Figures

Key Figures
Population:

10,274,595 (July 2002 est.)

Age structure 0-14 years: 17.3% (male 911,729; female 871,470)
15-64 years: 65.6% (male 3,395,885; female 3,341,536)
65 years and over: 17.1% (male 716,673; female 1,037,302)
(2002 est. Source: CIA)
Currency:

Euro
1 Euro (EUR) = 1.09 US Dollar (USD)
1 US Dollar = 0.92 Euro (March 13, 2003)

GPD purchasing power parity ? $267.7 billion (2001 est.)
real growth rate: 1% (2001 est.)
per capita: purchasing power parity ? $26,100 (2001 est.)
(Source: CIA)
Internet:

According to a survey (May, 2002) from the Belgium Internet Service
Providers Association (ISPA) in Belgium there is only 34 per cent internet
penetration. Only 31% of the internet users are women.

Telephones The mobile phone penetration is a low 39 percent.

3. Legislation

The National Lottery had the legal status of 4 a public institution and was monitored by the Finance Minister.

From April 19th, 2002, a new law 'to rationalise the operation and direction of the Nationale Loterij' came into force. And article 4, § 1 of this new law grants to the 'new' Nationale Loterij the legal form of a private company with limited liability of public law with a registered capital of Euro 62,000, which is the legal minimum.

The most imported changes of the new Law are:

Mr. Joseph-Emile Vandenbosch was immediately appointed as the new delegated executive. Other members still have to be nominated.

Due to the fact that in the first three and half months of 2002 the revenues dropped 9% compared with he same period in 2001 the Belgian Government wanted to push through the transformation within a very short period. And by Royal Decree of July 9th, 2001, the new statutes of the 'new' National Lottery were layed down.

On January 11, 2002 the Belgian House of Representatives passed a bill concerning the reform of the National Lottery. Herewith a ten-year process has been closed. This Government bill was tabled to respond to two evolutions. On the one hand and notwithstanding article 49 of the Rome Treaty, the European Court of Justice has repeatedly specified, namely in the Schindler, Laära and Zenatti cases, that Member states can maintain the existing national gaming monopolies.

On the other hand, the Government endeavors to respond to the evolutions in the gaming market, namely the boom of virtual gaming and the resulting consequences.

3.1 Tasks of the National Lottery

In the general public interest and in accordance with proper business practices, The National Lottery is responsible for organising public lotteries, betting and competitions in the manner laid down by HRH the King, on the recommendation of the Minister of Telecommunications, Public Enterprises and Participations.

In the general public interest and in accordance with business practices, the National Lottery is also responsible for organising games of chance in the manner determined by HRH the King, in a decision taken after consultation in the Council of Ministers, on the recommendation of the Minister responsible and of the Minister of Justice, and after receiving advice from the Lottery Commission, as referred to in article 9 of the law of 7 May 1999 on gambling, gambling establishments and the protection of players. The activity of the National Lottery is deemed to be commercial.

In addition to drawing up business methods intended to promote public lotteries, betting, competitions and gambling, the National Lottery is also responsible for the following:

The approach adopted is a double one. In the first place by offering an attractive and dynamic alternative to gamblers, the Government attempts to restrain gaming excesses, namely by lifting the virtual gaming market out of its current twilight situation. In the second place and following the UK example, by providing a regulatory framework - legalizing such activities - the Government attempts to keep the important financial benefits within the national territory in a way that they can be redistributed for social services or general purposes.

In other words, the adopted policy is one of 'responsible gaming' i.e. offering to the public an attractive but regulated alternative.

As a public enterprise, with the possibility to participate in a national or European cooperation, the National Lottery will receive additional tasks. Not only will the kind of games it can offer to the Belgian market increase but, and maybe more importantly, the National Lottery will also have the monopoly on the virtual gaming market. Only the National Lottery can legally offer e-games on the Belgian market.

Following the Schindler ruling of the European Court of Justice - re-affirmed in the Laära and Zenatti cases - Member states can impose restrictions on interstate gaming, betting and lotteries.

National rules that grant special rights e.g. a monopoly, to certain undertakings organizing gaming activities and consequently restrict the freedom to provide gaming services, are not incompatible with the freedom to provide services.

In application of article 6 of the bill the National Lottery may not only offer public lotteries, but also organize bets and games of chance. To increase the National Lottery's market position, by giving it the possibility to offer an attractive gaming product, the National Lottery can organize games of chance as regulated by the May 7th 1999 Act.

In addition, article 3 §3 states that the National Lottery also has an educational function. It has to provide the public realistic information about the winnings, to plan information campaigns concerning the social, economic and psychological risks arising from gaming addiction and finally, in cooperation with the competent authorities and associations to set out an active and comprehensive prevention and relief policy.

Since 1994, the National Lottery has been liable to an annual monopoly contribution to the State budget, the amount of which, as set by HRH the King, by order of the Council of Ministers, and may not exceed 3.5 thousand million BEF per year.

The National Lottery's profit is reserved for financing programs for assistance for developing countries and for purposes of public benefit as determined by a royal decree as discussed in the Council of Ministers. The portion of subsidies that belongs to the communities and the regions as stipulated in the special law of 16 January 1989 concerning the financing of the communities and the regions, is directly transferred to them by the National Lottery.

3.2 Supervising the National Lottery

A distinction should be made between monitoring the National Lottery as a public company providing a public service and the National Lottery as an e-gaming operator.

In the first hypothesis the activities of the National Lottery are submitted to the administrative supervision exercised mainly by the competent Minister through two government commissioners.

As an operator offering virtual games to the Belgian market its activities can - in application of article 9 of the 1999 Act concerning games of chance - be supervised by the National Gaming Board.

Although the primary assignment of the National Gaming Board is to supervise private gaming operators, who have as sole purpose to realize as many profits as possible, it is logical that, when the National Lottery offers the same or similar activities as the private operators, those activities are supervised as well.

Therefore, when the National Gaming Board considers that one or more activities organized by the National Lottery, can be qualified under article 1 of the 1999 Act as games of chance, it can monitor those activities, provided that both the Minister of Justice and the Minister of Public Enterprises do follow that opinion.

3.3 Closing Remarks

Although this bill can be considered the first serious attempt to regulate online gaming, two elements were not taken into consideration.

In the first place there is contradiction between this bill and the bill proposed by the Minister of Justice modifying the 1999 Act concerning Games of Chance. Although both bills propose regulating e-gaming activities, the first grants the National Lottery a monopoly on the e-gaming market while the latter leaves the door open for private operators. They can do so keeping in mind certain limits.

In the second place and maybe more importantly this bill or the bill concerning the modification of the 1999 Act, do ignore the cross border nature of e-gaming.

Offering e-games e.g. on the Net, means offering them to the players all around the globe and this indifferently of his or her location. Therefore one should consider the international dimension of e-gambling.

In a time and place where national borders - the geographical limits of a legal order - have become without meaning, special attention should be paid to the underlying legal issues, in particular competent jurisdiction and applicable law.*

* article written by Ewout Keuleers, attorney at the Brussels' Bar (ULYS law firm), published with permission. Ewout Keuleers obtained his law degree at the University of Leuven (KUL) and has a Masters Degree in Information Technology (FUNDP).

3.4 Gaming Board

When the Gaming Board, 'Kansspelcommissie', judges one or more offered activities or products, being games of chance the board is allowed to control them. The Kansspel­commissie is however not allowed to control the Nationale Loterij. The board may control above mentioned activities on their own initiative or on request of the Nationale Loterij. The president of the Gaming Board and the delegated executive of the 'Nationale' have to meet regularly and at least twice a year.

4. Operators

4.1 Nationale Loterij/Loterie Nationale (www.nationaleloterij.be)

4.1.1 History

In 1963 the National Lottery was established under the authority of the Minister of Finance. Precursor (1934) was the Colonial Lottery under the authority of the Minister of Colonies, operating under a full monopoly.

In Belgium creation of the lottery was linked to the financial problems in its colony, today's Congo. The government of Charles de Broqueville hoped to use such a scheme to make good its budget deficit. A law passed on the 29th of May 1934 provided the framework for this project.

The first draw of the Colonial Lottery took place at the Cirque Royal on Tuesday, October 18th 1934. The reactions of the press were extremely flattering but the 'Committee' (Board of Directors) viewed the draw of this first phase as a semi-failure. Their lack of experience could be seen in all aspects of the draw: the draw machine had to be borrowed, the sale of separate coupons and split tickets was inefficient, the advertising left a lot to be desired and too many tickets were printed. The Lottery should have sold 2 million 100 franc tickets, an impossible amount to retail on the Belgian market at that period.

The directors then implemented a series of measures to deal with this situation.

The period during which tickets could be sold was immediately shortened and the number of tickets and their unit price were halved. Before the end of the year, a complex network of retailers had been set up and the National Charity for Disabled Ex-Servicemen signed an agreement regulating distribution of the profits. All forms of media (radio, press, cinema) were used for advertising. From the outset, the Lottery also used the services of well-known graphic designers to provide elegant illustrations for tickets, posters and leaflets.

The Colonial Lottery gradually carved a niche for itself in society and became a national institution, working to gain the confidence of an increasing number of players.

And it definitely kept its promises. Of the 500 million franc profit made in 1940, the Colonial Revenue Department received 450 million, while more than 60 per cent of its revenue was refunded to players. The sale of 'fifths' resulted in approximately 15 million francs for the National Charity for Disabled Ex-Servicemen while twenty or so other humanitarian projects received very substantial financial support.

The events of May 1940 almost resulted in the disappearance of the Colonial Lottery. To ensure its survival, an original formula was drawn up, without its creators being aware that this would allow the Lottery to be easily launched again after the war. The statutes of the 'Winter Assistance Lottery' appeared in the Belgian official journal of laws.

The former role of the Colonial Lottery was abandoned and it became instead the principal sponsor of the Winter Assistance programme set up by nazi forces to distribute aid to children and the needy, particularly in the form of soup, milk, vitamins and clothing.

At the time of the Liberation, a transition could be easily made, with the latent 'Committee' of the Colonial Lottery invited to start work again, and permanently abandoning its 'Winter Assistance' label. Thus, when the 13th draw took place in 1946, the 'fifth' was replaced by the famous 'tenth' of the Lottery.

Turnover continued to increase over the next few years. The Lottery was thus able to make a generous contribution for the setting up of the World Fair in Brussels in 1958. In addition, humanitarian organizations, joined by some national associations, continued to benefit from significant financial support. As a result, aid to the Congo continued to grow.

1959 sounded the death knell for the Colonial Lottery. On the 30th of June 1960, Zaire was granted independence.

From this point onwards, the institution was known as the 'African Lottery' , before becoming the National Lottery in 1962. These statutory changes did not in any way affect aid to developing countries.

With the game of Lotto increasing in popularity throughout Europe, in November 1975, the Belgian government finally authorized creation of a numbers lottery called 'Le Lotto'.

The successful start of Lotto 6/40 was in 1978 and after that several new products were launched, others disappeared, some were highly successful and certain formats were adopted:

If 1978, the year of 'Lotto', was a highly significant pivotal moment because of the changes made to prize money policy, 1991 saw a dramatic overhaul of the Lottery's organization.

In compliance with government policy granting autonomy and responsibility to commercial public services, on September 1st 1991 the National Lottery was transformed into a public utility autonomous organization with legal status under the control of the Minister of Finance.

New instant games are launched on the market in quick succession: Domino (1992), '21' (1993), Tele-Kwinto (1994), Scratch (1995), Trix (1996), Magico (1997) and Eldorado(1997). Keno (1995) meets the requirements of another category of player.

On 16 July 2002 the National Lottery was changed from a semi-public institution to a limited company governed by public law. This means that the National Lottery has more scope to develop its activities like any other professional enterprise. The new status gives the National Lottery the opportunity to become more dynamic, react more quickly to market demands and forge closer links with other companies.

The daily running of the National Lottery is carried out by the Management Committee, under the guidance of the Managing Director, Joseph-Emile Vandenbosch. A Board of Directors, headed by Jean-Marc Delporte, supervises the Management Committee.

The Minister of Telecommunications, Public Enterprises and Participations performs its supervisory role via a Government Commissioner, appointed by HRH the King on the recommendation of the aforementioned Minister. This Commissioner attends the meetings of the Board of Directors.

The structure of the National Lottery has been adapted to its new form of organisation: there are five departments (Marketing, Sales, IT and Logistics, Strategy and Business Development and Personnel, Finance). Each department is headed by a manager who reports to the Managing Director. Furthermore, the commercial role played by the 8 Regional Offices is critical.

4.1.2 Products in 2000

4.1.3 New products in 2000

4.1.4 New products in 2001

In 2001 the scratchcards products Super Fun, Colores and Halloween were added to the game portfolio.

4.1.5 New products in 2002

Cabrio (from 06.05.02) and Cyclo (03.06.02) are the new instant scratch cards introduced in 2002.

4. 1.6 Key Financials

2001 was not a very fortunate year for the management of the Belgian National Lottery. That's probably why the Belgian state properties minister, Rik Daems, is still hoping to partly privatize the state-owned lottery in 2002. The government is looking for a partner (less than 50%), industrial or financial organization for the monopolistic lottery. Mr. Rik Daems has in the meantime discussed several propositions of lottery related companies and talked as well with lottery operators.

Key Financials
Sales in Euro        
Games 2001 2000 Amount %
Presto 24,931,127.60 27,589,516.83 -2,658,389.23 -9.64%
Subito 48,416,732.88 49,828,104.43 -1,411,371.55 -2.83%
'21' 19,510,069.81 20,289,157.88 -779,088.07 -3.84%
European 3,201,103.99 3,720,842.14 -519,738.15 -13.97%
Magico 5,076,461.49 7,414,920.46 -2,338,458.97 -31.54%
Eldorado 0.00 1,335,159.48 -1,335,159.48  
Subit'Euro 0.00 1,301,887.21 -1,301,887.21  
Win For Life 83,611,537.97 94,925,508.00 -11,313,970.03 -11.92%
Bingo Express 13,073,433.19 25,326,604.68 -12,253,171.49 -48.38%
Astro 15,861,580.48 30,954,502.86 -15,092,922.38  
Cybero 1,417,881.00 924,390.00 493,491.00  
Loxo 14,819,391.22 3,661,653.85 11,157,737.37  
Super Fun 20,086,685.00 0.00 20,086,685.00  
Colores 4,293,876.32 0.00 4,293,876.32  
Halloween 1,828,600.02 0.00 1,828,600.02  
Total 256,128,480.97 267,272,247.82 -11,143,766.85 -4.17%
         
Lotto 649,998,389.66 665,045,182.56 -15,046,792.90 -2.26%
Joker 67,331,050.63 68,685,804.87 -1,354,754.24 -1.97%
Total 717,329,440.29 733,730,987.43 -16,401,547.14 -2.24%
         
Keno 15,747,222.68 15,776,781.80 -29,559.12 -0.19%
Bingo 0.00 13,060,597.57 -13,060,597.57  
Total 15,747,222.68 28,837,379.37 -13,090,156.69  
         
Grand Total 989,205,143.94 1,029,840,614.62 -40,635,470.68 -3.95%

4.1.7 2000 and 2001

The profit in 2000 was appr. 184,680,000 Euro and the number of employees was 302 (312 in 1999). In 2001 the profit was still 210.590.507 Euro and a downsized staff of 286

4.1.8 Highlights 2002 and the 1st Quarter 2003

In October 2002 the National Lottery announced their intent to form a special 'Lotto Guidance Committee'. They admitted that it offers lotto winners inadequate assistance and protection against swindlers and said it would offer them financial guidance starting from 2003.

Currently the National Lottery simply hands the cash over to a lucky winner and advises them to contact their bank as soon as possible to seek advice over the best methods of investment.

According to the daily newspaper 'De Standaard', the lottery admitted it provides an unsatisfactory amount of guidance, particularly in light of the case of two weeks before in which a lotto winner lost his money by transferring the cash to a swindler who promised an enormous interest rate.

National Lottery spokesperson, An Lammers, said the organisation does not want to impose on the winners, but feels it has enough experience to offer them guidance. Lammers also assured the winners they can maintain their anonymity.

Lammers said lotto winners feel uncertain after their success and the recent swindling incident indicates that the lottery can offer a better service to its winners.

A special lotto guidance committee, with experts in and outside of the organisation, is to established in 2003 to establish the guidance regulations.

A new scratchcard goes on sale from 17 March 2003 at a price of Euro 1: the LOXO.

When you scratch the central part of the card, symbols appear. If you have 3 identical symbols in a horizontal, vertical or diagonal line then you have won the sum corresponding to the amount marked next to the arrow that points to your winning line.

4.1.9 Grants

The role of the Grants Department is to distribute the profits from the National Lottery to various projects of common public interest, as determined by Royal Decree.

In accordance with the law of 19 April 2002, concerning the rationalisation of the operation and management of the National Lottery, on the recommendation of the appropriate Ministers and in conformity with a Royal Decree that has been approved by the Council of Ministers, each year HRH the King determines the plan for distribution of the profits from the National Lottery.

This distribution plan includes:

The 2002 profits from the National Lottery have been estimated at 210,590,507.17 EUR. The profit distribution plan is determined by the Royal Decree of 26 April 2002.

The National Lottery supports social, sporting, cultural and scientific activities. This support includes funding of the following projects:

The National Lottery also subsidises organisations and associations such as the Red Cross, the three shelters existing in Belgium as part of the fight against the human slave trade, the Belgian Interfederal Olympic Committee, Child Focus, Europalia, etc.

As of the 2002, Federal entities are transferred their share of the grants directly. They each receive the following amounts, which they are free to distribute as they see fit:

Taking all sectors together, the National Lottery has contributed to many productions, events and prestigious initiatives, which include:

4.1.10 Revenue Allocation

The revenue generated by the National Lottery is allocated to financing aide programs for developing countries and to contributing to certain public purposes as determined by royal decree upon deliberation of the Council of Ministers.

An annual subsidy, the amount of which is fixed by royal decree, is granted to the National Disaster Fund, as well as to the King Baudouin Foundation. The King, on the recommendation of the Finance Minister and by decree deliberated by the Council of Ministers, determines the annual allocation of revenue.

The public purposes in question include, among others, assistance to the social (the handicapped, senior citizens, abandoned youth) and cultural sectors (Art and Literature, music, museums and libraries, cinema and multimedia), to sports, tourism, the preservation of the historical, artistic and scientific value of listed monuments, sites and buildings, to the welfare of mothers-to-be and infants, to nature and environmental conservation, to scientific research, to the welcoming and integration of legal immigrants and recognized political refugees and to activities, in the large sense of the term, in the social, family, humanitarian, patriotic, scientific, cultural and sport domains.

In accordance with the law of 22nd July 1991, modified by the law of 21st December 1994, the King decides each year how the profits from the National Lottery will be distributed.

This distribution includes:

4.1.11 Sponsoring

Born of a need for renewed publicity, sponsoring is a phenomenon that has developed considerably over the last few years. The National Lottery has not escaped that situation. The sums of money set aside for sponsoring may seem comparatively higher than those allocated to the various grants, but this is because the National Lottery is involved in a large number of sponsored initiatives, that for several years have earned it a place as one of Belgium's main sponsors.

Nonetheless, choices must be made from among the very large number of applications that are received by the National Lottery. These choices mainly revolve around budgets and quality and the amount of publicity the different projects are likely to generate.

Thus, it tends to be the general public that is involved more than limited circles, as care is taken to meet the broadest range of expectations. The activities of the National Lottery in 2002 focussed on:

cycling, motor racing, athletics, indoor sports, football, literature, music (rock, jazz and classical), theatre, folklore, comedy, the plastic arts, cinema, radio and television ventures and various events combining sport and popularity.

Sports Sponsorship
The Lotto Cycling Team is one of the top sporting sponsorship projects. Once again, during 2002, the team captured the attention of its many fans by finishing in a very honourable fourth place in the world rankings. In the wake of the new law governing the National Lottery, a limited company has been established to manage the cycling team.

The Grand Prix and Cycling Race of the Walloon Region, the Circuit Franco-Belge, the Pino C?rami Grand Prix and the Belgian Championship which satisfy the sports lovers.

Of course, other sporting disciplines have also caught the attention of the National Lottery. The world of athletics enjoyed quality events such as the Van Damme

Memorial, the International Meeting of Nivelles, the Meuse Marathon and the Cross Cup, the monumental cross-country event that, as of the 2002-2003 season, has the National Lottery as its main sponsor.

The events sponsored were the Belgian inter Motocross Championships, the Belgian Mountain Biking Cup, the Belgian Wheelchair Tennis Open, the national and European achievements of the Ostend and Charleroi basketball teams as well as the Maaseik and Roulers volleyball teams, the Charleroi Astrid Bowl, the SuperMoto World Championship (Namur), the International Triathlon at Eupen in addition to other national triathlon and duathlon events, the 'Balle Pelote' Federation, the Ten-Province Challenge (Motocross) and the Walloon Region Grand Prix (Cyclocross).

Finally, the National Lottery's involvement with the Royal Belgian Football Association has continued.

Cultural Sponsorship
The main cultural events backed by the National Lottery during 2002 also cover a wide range of sectors: music, literature, cinema, theatre, the plastic arts as well as special multidisciplinary events that do not belong to any one specific cultural sector.

In the field of literature: the 'Espace Jeunes Auteurs' competition for young writers and the Chiny Tale Festival.

In music: the Fl?malle 'Fiesta du Rock', Marktrock in Louvain, Verdur'Rock in Namur and Suikerrock in Tirlemont, the Autumn Jazz Festival, the Jazz à Liège event, the Gaume and Gouvy Jazz Festivals, the Brussels Jazz Marathon and the Ciney Jazz Night.

In the field of classical music there were supported: 'Juillet musical d'Aulne', the Spring Concerts in Silly as well as the Horrues summer event, the Waterloo Mozart Festival and the Philharmonic Orchestra in Namur. We were also serenaded by events such as the Couleur Café and Bruges Festival world music festivals, the country music festival in C?rexhe, the folk festival in Dranouter and the opera in Hulpe.

In theatre, the Centre Culturel des Roches in Rochefort, the circus evenings in Enghien, the Saint-Ghislain Folklore Festival and the Jambes International Folklore Festival, were supported. What's more, as is traditional, the show organised each year in Villers-la-Ville pulled the crowds in. In 2002, 'Les Misérables' was performed. Humour was provided by the Rochefort and Bierges Festival of Laughter.

The annual exhibitions at the Musée en Piconrue in Bastogne, the Rops Museum in Namur or at St Gérard de Brogne Abbey and the 'Artistes des villes et des campagnes' event were the key activities in the field of plastic arts. In cinema, the National Lottery was present in Brussels with the International Cartoons and Animated Film Festival and the International Festival of Fantasy, Thriller and Science Fiction Films. In Gand it took part in the International Film Festival and in Mons, the International Festival of Love Films.

Sponsorship of Special Events
The activities of the National Lottery here included the animations by the Eau d'Heure lake, the 'Piste aux Espoirs' circus festival in Tournai, 'Namur en mai', the Festival of Fairground Arts, the Jambes Procession, Laetare Carnival in Chapelle-lez-Herlaimont, the Chimay rendez-vous, the 'Zomeraperitiefshows' which are successfully organised by the presenters Luc Appermont, Els Tibau and Katja Retsin, and the various summer programmed in the Walloon region.

In radio and television, the National Lottery renewed the contracts with RTBF, VRT . In the course of the year 2002, VRT and RTBF also broadcast the results of the Lotto/Joker and Keno draws, while the National Lottery ensured it was present on VRT by sponsoring the very popular series 'FC De Kampioenen.'

Meanwhile, the editorial unit coordinated the bi-monthly newsletter 'LoContact' and the content of the National Lottery's annual report, which reviews the year's activities and website performance.

4.2 New Lottery Terminals

GTECH announced (May 2002) that the Company was chosen as the successful vendor to provide new lottery terminals and a new communications network to Loterie Nationale of Belgium. GTECH will replace Loterie Nationale's existing terminal base with approximately 6,000 Altura(r) terminals. The Altura, GTECH's most advanced point-of-sale terminal, offers high-performance PC architecture and advanced software capabilities that facilitate the rapid introduction of new games and future lottery applications.

In conjunction with Belgium's largest telecommunications company, Belgacom,GTECH will also replace Loterie Nationale's existing communications network with a secure, nationwide IP (Internet Protocol) communications network based on ISDN AO/DI technology and GTECH's IP-GTX front-end processors. GTECH will integrate the new terminals and the new IP network with the existing ProSys(r) central system. GTECH anticipates receiving approximately U.S. $33-$35 million in product sale and service fees over the next several years, beginning in fiscal year 2004.

4.3 Casinos

Belgium Casinos have been operated as private clubs. Now that the law has been amended the operating of casinos will become 100% legal. Also Slots, which were not permitted previously, will be allowed. The operators have to obtain a license from the Belgium 'Gaming Board' (Kansspelcommissie).

4.4 Regulator

The 'Gaming Board' gives advise to the legislative and the executive power. Above that the 'Kansspelcommissie' grants licenses to casinos, fun-fairs (luna-parks), their staff, restaurant owners and supporting industry for those establishments and certifies the models of the used gambling machines and equipment. Furthermore the board controls the licensees and can decide to warn, to suspend and/or withdraw a license. Another task is the players' protection.

Moreover the Gaming Board is responsible for the application of Directive 91/308/ EEG of June 10th, 1991 law of 11/01/1993, modified by law of 10/08/1998) concerning the legal- and statutory bodies, who operate one or more game of chances of Class I.

On June 29th, 2002 by Royal Degree of June 20th, 2002 it was decided that licenses in Class D as published in the Belgium State Gazette, may be obtained.

At this moment the following landbase casinos are operated:

An additional license may be awarded for Brussels' prestigious casino project 'Euro-Casino'. According to the Law of May, 7th, 1999, game of chances and arcades/casinos are regulated and creates, therefore, the possible founding of EuroCasino in the 'Capital of Europe'.

The reputable shareholders of EuroCasino are:

The Dutch-Belgium Fortis Bank, who was the the initiator of the casino project in Brussels, is EuroCasinos' financial advisor.

4.5 Horsebetting

website: www.turf-be.com

For years and years horse racing and parimutuel betting in Belgium is complete in distress. P.M.U. Belge, the horsebetting operator, was pursued by many court cases (tax case Arrest nr. 56 of June 2nd, 1988, the courtcases of Tiercé Ladbroke Belgium, etc. etc.), and the poor results of the horseracing industry, since the best Belgium horses are racing in French. So it is not so strange that a part of a new strategical plan is the breaking up of the Belgische Federatie van de Paardenwedrennen (Belgium Federation of horse betting racing) in a Flemish- and a Wallonian Federation. It looks like they are backing the wrong horse.