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Will The German States Bet On Online Gaming?

Article by : Helen Oct 7, 2020

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The German government’s 2007 Casino Act failed to include online gaming, leaving the federal republic’s states to decide how best to regulate and form laws on their own. For the most part, online gambling has been considered unsanctioned and illegal by all German states until 2011, when one German state brought online gaming regulation and sanction to pass with just one more vote in favor than its opposition.

Germany’s pioneering state in online gaming, Schleswig-Holstein, faced significant challenges upon regulation’s implementation in 2011. The state risked being excluded from Germany’s national lottery grouping, the Deutscher Lotto-und Totoblock (DLTB), which would be considered a breach of federal solidarity. At that moment, Schleswig-Holstein also faced uncertainty on the effect it could have on gambling addiction within the state. These challenges still exist today, as well as the need for Germany to ensure that any state’s operation of online gambling laws won’t run afoul of the EU, which could have tremendous consequences. The modern prevailing political argument hinges around the fact that gambling regulation doesn’t necessarily increase the prevalence of gambling. Instead, it will regulate a market that is already going on unregulated and unsanctioned, and slowly draw people from illicit or unregulated gambling options.

The German State of Brandenburg’s latest state legislation, the Interstate Gambling Re-Regulation treaty, has opened up the possibility of online gambling being sanctioned and regulated throughout the state for the first time. Some of the regulations are related to location. For example, sports betting venues will have to be separate from casinos or online gaming kiosks. Ideally, the regulation states that the two different gaming vendors wouldn’t even be in the same building or business park. Past that, the legislation outlines much of the gambling that is and isn’t allowed to occur. Sports bets are limited to outcome bets, which means bets on individual events during a sporting event (number of fouls, for example) are excluded and not available through sanctioned sportsbooks. Due to their individual nature, bets are considered by the German government to be more susceptible to corruption and therefore remain unsanctioned.

Individual players are going to be limited to spending no more than one thousand euros across all operators per month as a standard practice.

If they’d like to increase that limit, they can do so by setting a maximum bet and loss limit with game operators. The increased limit for players after setting bet and loss limits is ten-thousand euros. There has been no change made to the ban policy, which states that either third-parties or the player themselves can authorize a ban resulting in no less than a year suspension from all gaming vendor services. After the passage of a year, players may re-apply, but ultimately must be approved by the ban’s original issuer.

Interestingly, small lotteries (categorized as any lottery with less than 40,000 euros in fees paid) can deviate from the State Treaty for lotteries when the net income for the lottery is used, “exclusively and directly for charitable or church purposes.” It seems lawmakers were concerned about smaller raffle type fundraisers that are common for charity causes being wrapped up in regulations that they’re ill-equipped to deal with.

While it’s a hopeful start, to be solidified on a state level that keeps the door open for the other states to join, it will require thirteen of the sixteen federal-state votes to become ratified. So far only Berlin has indicated an ability to move forward, so it’s likely that the legislation will sustain via a standstill period through 2020.

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