The European Betting Association will file a compaint with the EU commission against state-run Loterias y Apuestas del Estado.
According to EBA, private online betting companies are not allowed to operate or promote their services in Spain, and this is an infringement of EU regulations.
EBA, which promotes a liberalized cross border sports betting market within the EU, already launched similar initiatives against Denmark, France and Germany.
The members of EBA, which include Bet365, BetandWin, Betfair, Digibet, Expekt, Globet, Intertops, Interwetten, MrBookmaker, Primebet, Sportingbet, Unibet and Wettenleip, are believed to hold 80 per cent of the private sports betting market in Europe.