Germany

Posted on Tuesday, 25 October 2011

With the harmonization and regulation of the online gaming legislation throughout Europe, there is pressure for Germany to open up its online gaming market, which is currently controlled by the country's 16 states.

' ...this State Treaty is due to expire on December 31, 2011. The way forward has been paved by the state of Schleswig-Holste which has become the first of the country’s 16 states to legalize and regulate online gaming'

Germany’s states presently have the power to regulate online gaming in their regions and have chosen to ban online gaming, seen as in opposition to EU online gaming free trade agreements. While in the meantime a large percentage of an estimated 2.2 million German online players have continued to wager online via offshore gaming sites resulting in huge losses in potential tax revenue for the country as a whole.

Germany’s current ‘States Treaty on Gambling’ allows the state to maintain a monopoly on sports betting and lotteries, while upholding a state-wide ban on internet gaming activities. However, this State Treaty is due to expire on December 31, 2011.

The way forward has been paved by the state of Schleswig-Holste which has become the first of the country’s 16 states to legalize and regulate online gaming, potentially showing the way for the other federated states to follow suit.  

Key elements to the new law include issuing an unlimited number of licenses to companies allowing online exchange and sports betting, as well casino games and poker. In return a 20% tax on gross profits will be collected by the state. 

This resolution is an important and groundbreaking step on the way to an open and regulated gaming market in Germany. There is hope that the other 15 German States, especially after the pressure from  Europe and online gaming operators, to implement these regulations after the expiration of the “States Treaty on Gambling”, in order to bring them in line with EU law.

Posted by Aneliese

Last Updated on Tuesday, 25 October 2011