The European Union’s executive branch has extended the postponement period for the implementation of Germany’s updated gambling legislation. This decision comes after various interested parties expressed significant concerns regarding the proposed regulatory structure.
The suspension period will conclude in September following Malta’s submission of a comprehensive, though not yet publicly accessible, statement on the new German Gambling Regulation Ordinance (GlüNeuRStV).
The legislation was officially communicated to the European Commission in May of this year. It establishes a more expansive regulatory framework compared to the previous Interstate Treaty on Gambling, which aimed to restrict the online market to sports wagering.
Products such as online poker, casino games, and slot machines are permitted to be offered, but subject to stringent conditions. For instance, the German Online Casino Association (DoCV) voiced its opposition to the separate offering of slot machines from other online casino offerings, such as table games, in its comments on the legislation.
The German Federal Council (Bundesrat) has voiced apprehensions regarding the new German state gambling regulations (GlüNeuRStV). They believe the regulations contain control measures that could diminish the attractiveness of legal gambling. The Bundesrat also argues that there’s no justification for separating slot machines from other casino games, as the public views them as part of the same online casino experience.
The Bundesrat also criticizes the plan to grant state lotteries the initial right to offer table games. They believe this will create a perplexing blend of public and private operators, resulting in an inconsistent system. They suggest replacing the regulations with a unified online casino licensing system that encompasses all gambling products.
The International Betting Integrity Association (IBIA) has also expressed concerns about the limitations on live betting. They argue that there’s no proof that live betting increases the risk of gambling problems and that match-fixing is primarily a concern in Asia, rendering the restrictions ineffective in safeguarding sports from manipulation. The IBIA believes these restrictions could even amplify the risk of manipulation by driving live betting to unregulated providers outside Germany.
Numerous submissions to the European Commission have questioned the rationale behind the €1,000 monthly spending limit, which will apply to all gambling products.
Academics from the Dresden Institute of Technology highlight that the law’s implementation is discriminatory, as it excludes land-based betting and lotteries.
The IBIA also stresses that there is no adequate justification in the legislation for restricting the cap, nor is there evidence that this would enhance player safety standards.
Researchers from Dresden University primarily concentrate on player protection measures, arguing that these need to be enhanced to develop player protection approaches tailored to each legal product, including lotteries.
They caution that, like deposit limitations, the application of player protection measures is inconsistent, meaning that player protection standards vary based on the product or channel.
DoCV adds that the capacity for players to set voluntary spending limits is sensible, but questions whether a seven-day cooling-off period is suitable before implementing any requests to increase these limits.
It contends that players could easily switch to unlicensed websites to gamble during this period and suggests adopting the current 24-hour cooling-off period in Schleswig-Holstein.
Control measures in GlüNeuRStV that prevent access to these illegal operators are also questioned.
The German Banking Association, Deutsche Kreditwirtschaft, believes that the provisions in the legislation concerning blocking transactions with illegal websites are too broad and ultimately breach the Treaty on the Functioning of the European Union.
Although the regulatory body recognizes these steps, it also highlights that financial institutions will require substantial investments to thwart transactions and will need extensive sensitive data to precisely identify each illicit gambling transaction. Consequently, the agency asserts that it is virtually impossible to completely block all offshore transactions.
The German Internet Industry Association Eco subsequently criticized the bill’s provisions regarding authorities ordering internet service providers to restrict access to unauthorized websites. The association maintained that the wording used in GlüNeuRStV is overly broad and expressed fundamental concerns about ISP blocking control measures, as these measures infringe on net neutrality.
Lastly, DoCV questioned the advertising limitations outlined in the legislation. The organization emphasized that advertisements posted on social media at 10:30 pm remain visible the following morning at 7 am, making it practically impossible to enforce the proposed gambling advertising time frame from 9 pm to 6 am, particularly online.
Other interested parties have until September 18 to provide their feedback on the bill, which is slated to come into effect on July 1, 2021. It is currently uncertain whether there will be an intensified effort to prevent operators from offering online casino products in Germany during the transition period, with some states currently deliberating a potential transition period for the sector.
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