The law on gambling in Germany has had been quite complicated over the last few years. Especially concerning online gambling. In the form of the updated Glücksspielstaatsvertrag 2020, a new gambling law has been brought in to set the groundwork for clearer legislation. This article will outline the legal situation for gambling and online gambling in Germany and the changes that the new law will make. From there, we will provide an insight into how the area may be regulated in the future.
What does the new Gambling Law Entail?
The new gambling law – an updated version of the Glücksspielstaatsvertrag – is not intended to be a complete answer. In fact, it is more of a placeholder until more comprehensive legislation is put in place in 2021. This current legislation runs until June 30. 2021 and from that time onwards, the hope is that a better solution will be found than what is currently in place.
This updated version of the Glücksspielstaatsvertrag allows private firms to apply for gambling licences to operate in Germany. With this in mind, international outlets will be able to set up operations in Germany. Applications can be made to the Regional Council in Darmstadt [Regierungspräsidium Darmstadt]. The licences themselves will be valid until after the new and more permanent legislation should be put in place. A new nationwide “Joint Gambling Authority of the Federal States” [Gemeinsame Glücksspielbehörde der Länder] has been planned for but won’t be in place until later.
The new law also entails certain limitations. Within the law, there are limits as to the monthly stake a person can bet, which the firms should regulate and also there are limits in aspects of “in-game” betting. There are also limitations regarding where betting shops and other gambling facilities can be established. Gambling facilities in Germany have to be situated certain distances from schools as well as from each other.
A Long Term Solution?
As for the law itself, it is not a long-term solution. Therefore the uncertainty still exists. It is unclear whether the German states will agree on a long-term solution in the timeframe provided to them. Some states desire to pursue a more progressive gambling law regime, whereas others seek a more conservative version.
Overall, the updated legislation provides some degree of progress. It is now more straightforward for private betting firms to enter the German market, reflecting how big the market is. Not dealing with the business of online gambling was never going to be a satisfactory solution.
However, the gambling situation is not completely cleared up yet. This legislation will not be in place permanently and has a deadline installed within it. If we look at it from a positive perspective, this updated legislation could lead to the necessary changes needed in German gambling law. This legislation may open the door to adjustments. Such change could then lead to greater investment and competition within a more liberalized market. Whether this will happen, however, remains to be seen.
What was the Situation in Germany Before the Gambling Law
The law on gambling in Germany has been quite complicated over the past few years. Before 2008 there was no real legislation in place for online gambling. The world of online gambling was largely unregulated. Following this situation, there was a legislative attempt to limit online gambling, but this did not really help matters.
In practical terms, gambling online was not seen as an illegal activity, but punters were provided very little legal protection in issues around complications or irregularities. Online private gambling companies could not be set up in Germany under this law. However, the German state could not prevent online gambling outlets, set up in other EU jurisdictions, from trading in Germany. Doing so would have been against EU law.
With this in mind, a new legal solution was designed in the form of the Glücksspielstaatsvertrag (or the Interstate Treaty on Gambling – ISTG). Gambling law in Germany is regulated to give the 16 federal states a degree of autonomy and power.
The states followed the gambling law from 2008, but the ISTG Schleswig-Holstein decided to go its own way. During a short window, the state issue several gambling licences to companies operating online. A small number of online gambling firms were given licences for 6 years. Amongst these firms were some of the biggest names in the online gambling scene, such as Ladbrokes and Bwin. However, following this initial licencing, Schleswig-Holstein withdrew from giving more licence and largely adopted the legislation.
What is the Status of Other Gambling Outlets
When it comes to lotteries and physical (bricks-and-mortar) casinos, these have been largely state-run. Lotteries are run by the state, while casinos can be opened once one has the required licences. However, most of the licences have been given to state-operated casinos. Casinos in that form were permitted in almost every state, with only Thuringia and Mecklenburg-Pomerania not permitting them. When it comes to lotteries, private companies can gain licences to sell lottery tickets.
Horse racing and lotteries have been legislated for at a federal level, providing more legal certainty in these fields. The Rennwett-und Lotteriegesetz has provided some clarity for those involved in these industries.
Legal Representation and Counsel
When it comes to negotiating German law, look no further than Schlun & Elseven Rechtsanwälte. At our law firm, we provide advice on topics ranging from establishing companies to employment contracts. In the field of gambling, we can provide the help your company needs when it comes to achieving success in Germany.
Our firm offers our services in various languages from our offices in Cologne, Düsseldorf and Aachen. We also provide conference room facilities in Berlin, Munich, Hamburg, Stuttgart and Frankfurt. Should you require legal assistance in Germany concerning the new gambling law, don’t hesitate to contact our law firm directly. We look forward to working with you.
