FDJ to implement a comprehensive insurance policy
The French gaming company FDJ has announced the implementation of a comprehensive insurance policy to cover its counterpart risk.
France.- Française des Jeux (FDJ) has announced the implementation of a comprehensive insurance policy to cover its counterparty risk starting January 1, 2020. This reform is part of a process to clarify the relations between the state and the company, following the privatisation of FDJ.
One of the changes involved in the tax and regulatory reform carried out as part of the privatisation of FDJ was the discontinuation of the “counterparty fund” system, a form of insurance that the state offered the company by letting it keep a portion of its gaming levies to set aside as a guarantee fund, which could be used in the extremely unlikely event of a high payout.
The privatisation of FDJ meant that the company is now responsible for covering counterparty risk through an insurance policy, at its own expense. As such, FDJ has taken out a comprehensive insurance policy with a number of top-tier French and international insurers and reinsurers to cover its counterparty risk, which will take effect starting January 1, 2020.
The company also said that the contract, which is drawn up with insurance broker Marsh, provides a guarantee for the faint falling within its scope on an aggregate basis. It provides annual coverage of up to €150 million. All costs related to this insurance policy are in line with expectations and are covered by the planned budget.
FDJ interested in UK National Lottery
FDJ is reportedly interested in becoming the next operator of the UK National Lottery. The governance of FDJ held private discussions with the Rothschild investment bank to evaluate which options it has to compete for the UK National Lottery 2020 licence, The Daily Telegraph reported.
The Rothschild investment bank is one of four strategic consultants appointed by the UK Gambling Commission (UKGC) to support the 2020 offer structure and the bidding process, working in collaboration with the management consulting firm Deloitte, the EY auditor and the law firm Hogan Lovell. Although UKGC has yet to reveal its official offer, numerous high-profile participants have been revealed.
