Germany has been the center of attention when it comes to tight legislation and robust regulations within the gambling industry for some time. This is hardly a surprise when you consider the country's reputation with only the highest standards slipping through the net.
With a population of approximately 83 million and a strong economic standing, it is clear why the government wants to limit wagering as a way to retain wealth. However, the typical efficiency and perfection that we would expect to see in Germany appear to be somewhat lacking when it comes to online gambling regulations.
Instead of a clear set of rules, we are left with a complicated jurisdiction in which EU law and continuous monitoring of regulatory developments are of utmost importance. So although online betting is legal according to GamblersDailyDigest, it doesn't come without issues across the breadth of the European giant.
There is no one-rule-fits-all attitude because each of Germany's 16 states is able to make its own decisions on gambling regulations, potentially making it very messy for online casinos to function.
So just how tricky are German gambling rules and regulations?
A brief history of online gambling in Germany
Currently, German states regulate gambling with what's called an Interstate Treaty of Gambling in which each state implements its own respective state laws. This form was introduced in 2012 to allow for uniformity within the states, sensibly creating what stands as cornerstones in the eyes of online gambling.
The treaty provides for a state-monopoly of online lotteries and sets the standards for the regulation of land-based casinos and gaming halls. It also prohibits online betting games of chance (e.g., slots, poker, blackjack, etc.) with the exception of horse racing and sports betting – good news for football fans.
Sticking to the area of sports betting, the treaty introduced the opportunity for licensing for the first time as ordered by the Court of Justice of the European Union (CJEU). This should have led to the introduction of 20 sports betting licenses, but the process failed, leading to heavy criticism of the process.
Another case was brought before the CJEU in February 2016. The hearing decision concluded that the sports betting licensing process had been created in a non-transparent and discriminatory manner. Criticisms were then directed at the German states for having prevented the introduction of a system capable of overcoming the unlawful licensing process surrounding the state-monopoly – ultimately leading to the requirement of reform in the current regulation.
The third amendment treaty
More recently, Germany's politics concerning gambling could be described as a game of ‘push-pull' with ongoing disputes between states surrounding just how extensive reforms should be.
The German Prime Minister signed an amendment to the Interstate Treaty of 2012, ultimately leading to the Third Amendment Treaty. If ratified before 31 December 2019, the treaty will go into force on 1 January 2020, somewhat clearing the confusion surrounding laws, rules, and regulations.
With the Third Amendment treaty comes the opportunity for an improved sports betting licensing process following the criticism received in 2012. However, the number of casinos won't be capped at the 20 previously permitted. In a highly unusual effort to ease the issues surrounding the process and resolve the problems found in German sports betting, authorities even intend to release the application requirements in advance of passing the law.
Additional restrictions introduced with the treaty
The third amendment treaty isn't without some highly questionable restrictions. The following are just some of the proposed modifications:
- Limitations in the permissible betting product range (heavily affecting bet-in-play)
- A 1,000 EUR monthly stake limit for each individual
- A prohibition of parallel online casino operations
The tightening of the guidelines would lead to several significant negatives for licensed operators with a clear huge hit expected from the caps and features with bet-in-play amongst the worst affected. The regulations will also lead to huge disadvantages for licensed operators that will almost certainly be challenged.
The extendable nature of the treaty
It's worth mentioning that the treaty itself is extendable in its nature. Although the current goal of validity stands at the 30 June 2021, it can be extended until 30 June 2024, giving a further three-year temporary window.
Some states, such as Schleswig-Holstein are pushing for decisions on what the future holds. This is heavily due to the desire to see fundamental changes in the German gambling regulations.
With some states wanting to introduce online casino licensing, it's no surprise they're applying pressure to force the hand and finally reach a conclusion.
The future of online gambling in Germany
Right now, it is unclear how long these licenses will last once they are granted due to the uncertain and transitional nature of the third amendment.
There are still plenty of question marks surrounding the future of the new sports betting license process as well as the licenses themselves. What is clear is that there will soon be much less controversy with the interaction between states when discussing how sports and casino betting can be regulated in the future. With any luck, Germany will follow in the footsteps of the US with the freedom to gamble freely with plenty of bonuses. But if you're not sure what online platforms you can play at, check out OnlineCasinoGems for in-depth reviews of various casinos operating in Germany and all over the world.
For the time being, it is expected that the third amendment will be passed as a temporary measure. This means that the potential exists for a change in the law that could affect casinos as soon as 2021, However, it might take a little longer to iron out all the details of the modified regulations.
The current options range from sticking to the prohibition of online casinos, introducing a state monopoly or building an open online casino licensing system. It seems possible that Germany may split into states and work with those who introduce online casinos and those that do not.
Whatever the outcome, it will be down to the casinos, the marketers and the customers to adapt and react based on careful study of the rules and regulations proposed. It might take some adjustment and finessing but eventually some coherent system will become law.
