Gamblers can contact the given regulator for more information or file complaints when a bookie/casino violates its Terms and Conditions. If the different European betting sites violate the rules while having an active license, the commission may revoke it. Usually, the licenses last for a couple of years and have to be renewed after they expire.
These places issue licenses to given operators that adhere to their rules. Most countries have their own gambling authorities to monitor all betting activities within the jurisdiction. Yes, you can bet legally in Europe, as long as you reside in a country where gambling is legal.