News

With a regulatory framework dating back to 1998, Bulgaria is one of the most mature and established gambling markets in Europe – but recent changes to regulation are placing the jurisdiction on shaky ground.

On 18 May this year, the government introduced a tough set of new regulatory measures for the gambling industry, including a near complete ban on advertising. Almost overnight, licensed operators in Bulgaria were barred from taking out ads on radio, television and in newspapers, as well as on online media websites.

Billboards were still permitted, but only if they were at least 300 metres away from schools, universities, playgrounds and other protected areas, with at least 10% of advertising space dedicated to a warning about the dangers of gambling. Advertising on buildings offering gambling services were also strictly controlled, with no more than 50 square metres or 20% of the whole facade allowed to display the advert.

Beyond the crackdown on advertising, MPs also voted to include certain social groups on the national self-exclusion register, including people receiving state support – effectively banning welfare recipients from gambling.

For land-based operators, a particularly odd clause in the law stipulated that gambling venues were no longer permitted in any town with a population under 10,000. Operators in breach of this rule – or located within 300 metres of a protected area like a school or student accommodation – were given three years to close.

Diversification is the only option for local brands
According to Mark Chakravarti, investments director at local operator Sportingwin, the advertising ban has led to a steep decline in revenue for Bulgaria-facing operators.

“Global research shows that when they have these bans put in place, especially limiting TV commercials, there is a drop of 20% revenue in the next two months,” he tells iGB. “I think it’s been very similar in the Bulgarian market.”

Since the ban was introduced back in May, for example, major market players like Sesame, 8888 and Winbet have all seen a double-digit dropoff in website traffic, equating to a similar drop in revenue. For Entain’s Bwin, which has been licensed in Bulgaria since 2016, traffic declined by as much as 17%.

When it comes to weathering the storm, operators like Sportingwin with regional know-how and expertise have proved to be more resilient than their international counterparts, facing a single- rather than a double-digit drop in revenue after the new law was introduced.

Who’s next to leave Bulgaria?
In contrast, major players like Betway and Betfair have chosen to exit the market in recent years, as the regulatory climate has made it more difficult for them to operate. Chakravarti believes that Bwin could be next.

Speaking on an Eastern European Gaming Summit panel on 22 November 2023, Bulgarian Gaming Association chair Angel Iribozov described regulatory changes in Bulgaria as a “perfect storm for operators” and “disastrous” for the market. And the storm already appears to be having a chilling effect on gaming companies active in the region.

“As a small local brand operator, we have a better understanding of the local market, we have better expertise, so we are able to change and adapt,” he said. “But we can see that the big operators that are foreign, international – they are not aware of the local markets, they don’t have the geomarket expertise,” he notes.

Recent clarifications from Bulgaria’s regulator, the National Revenue Agency (NRA), have opened up some new possibilities for online advertising. These limit the ban to online media companies who exercise editorial control over adverts, meaning many social media sites could be exempt from the rules.

However, this minor concession is unlikely to offer much relief while the TV ban – which Chakravarti says is most damaging to operators – remains strictly enforced.

“Around 5% of customers bring in 95% of the revenue,” he explains. “And not many of these come through social media.”

Nevertheless, Sportingwin is currently hedging its bets by exploring three new jurisdictions: the UK, Romania and Brazil. Having reached what it believes is a ceiling in the increasingly tough Bulgarian market, diversification seems to be the only option.

Increased hurdles for market entrants
For a long time, the regulated Bulgarian market was seen as an attractive option for gambling firms, largely thanks to its low corporation tax, EU membership and relatively low barriers to entry.

Currently, there are 15 licensed operators active in the market, including major local players like Efbet, Winbet and Palmsbet, as well as international brands like Bet365 and Bwin and newer market entrants like Sportingwin and Betmarket.

According to Yield Sec, which tracks online gambling activity in regulated markets, the impact of the advertising ban was felt in the market long before it came into force.

It estimates illegal operators accounted for around 87% of GGR in Bulgaria in 2023, netting around €3.8 billion in revenue compared to the regulated market’s €562 million in revenue. In the first half of 2024, in the lead-up to the new regulations, the illegal market share grew to 91%, according to Yield Sec estimates.

But while there have been attempts to crack down on the black market by blocking payments to unlicensed companies, hurdles for new licensees are also getting higher.

At the end of the last year, the government brought in a hike in the licence fee for new entrants to the online sports betting market – from BGN100,000 (€51,000) to BGN400,000 (€204,000).

From May, the amount of paid-in capital (investor contributions) required for a licence also rose from BGN500,000 (€255,000) to BGN750,000 (€383,000).

Politicians unwilling to hear industry’s concerns
This, along with the ever-changing regulatory landscape, is creating a “challenging” environment for newcomers, Chakravarti says. More worryingly, there seems to be little possibility of dialogue with politicians or the regulator.

“From my knowledge of Bulgaria, there are a lot of regulatory controls that keep changing and politicians are shifting the goalposts, which becomes very challenging for operators,” he explained.

In a particularly worrying sign for the industry, the advertising ban and accompanying regulations were voted through unanimously back in May, as Bulgaria’s parliamentary parties put aside their differences to present a united front against the sector.

With this top-down approach and ever-shifting regulation, operators in Bulgaria appear to be left with just two options: adapt or look elsewhere. As the coming months unfold and old licences expire, we’re sure to find out which of these roads they’ll take.

Finland is preparing to usher in competitive online gambling in January 2026 as it moves away from its legacy monopoly model and the monopoly operator Veikkaus competes against licensed operators for market share across both online sports betting and gaming.

The sector had been unsure where horseracing betting would lie in the regulation, as prior to re-regulation it was offered exclusively by the monopoly.

In a statement noting its final decision on horseracing betting, Finland’s ministry of the interior said state funding would support breeding and developments in the horse racing sector.

“In the future, through the state budget, support will be allocated to breeding, horse industry operator-specific advice and the development of the competition system,” the statement said.

Industry was unsure where horseracing betting would fall
Local consultant Jari Vähänen told iGB in July that there was no mention of whether horseracing betting would remain under the monopoly in the draft regulations. These were released on 3 July.

“It’s another story, on what will happen for horseracing, right now it’s on the monopoly side,” Vähänen said at the time. “I know the horseracing industry is lobbying heavily to move to the licence-based system. If that happens, I suppose that horseracing betting will be also allowed in retail salons.”

Then on 16 October, Mika Kuismanen, CEO of Finnish online gambling trade body Rahapeliala Ry, told iGB the ministry for the interior was in the final stages of preparing the legislation before sending it off to the EC.

He said horseracing betting and the launch date for the open market were the final two decisions left for the government, and a cross-party committee, to make.

The ministry for the interior confirmed in its statement that 1 January 2026 would remain the open sector’s launch date. “Finland’s gambling system will be reformed and opened to competition with a licence model no later than 1 January 2026,” it said.

On sending its regulation to the EC, the ministry said: “The purpose of the procedure is to get possible feedback from the Commission and other EU member states on the proposal’s consistency with EU legislation and the principles of free movement.

“The government’s proposal is to be presented to the parliament in the spring session of 2025.”

In July, the government said it aimed to present the final draft to parliament in February 2025. This os ahead of it launching the market fully in January 2027.

“We will likely have the law approved [by parliament] before midsummer [June 2025],” Kuismanen said previously.

Regulation more “business friendly” that earlier efforts
Commenting on the regulation, Antti Koivula, a legal advisor for Finland-based Legal Gaming, said while some commentators may remain disappointed, it does bode better for businesses than earlier proposals.

“Overall, the updated draft law is significantly more business-friendly compared to the initial draft released in July.” Koivula said. “As a lawyer, I have yet to encounter a law that satisfies all interest groups.”

Koivula noted how marketing restrictions have been eased, particularly with regard to brand marketing conducted offline. He also spoke about the benefits of moving parimutuel horse betting from the exclusive rights category to licensing.

However while Koivula said gross gaming revenue tax rate (GGR) remains the same, there is additional burden for some operators.

“The GGR-based annual supervision fee has been notably increased,” he said. “It effectively creates an additional tax burden that can exceed 2% at certain GGR levels.”

In addition, Koivula accepted certain “much-needed” clarifications were made in the explanatory notes of the legislation, there is still some level of uncertainty that will need to be address.

“Several much-needed clarifications were included in the explanatory notes, which is highly positive,” he said. “On the other hand, many aspects have been deferred to secondary legislation, leaving numerous questions unanswered for the time being.”

Total revenue was comfortably higher than $462.7m in April last year. However, the figure fell 3.0% short of the $526.6m reported in New Jersey in March this year.

Beginning with land-based casino, this remains the primary source of gambling revenue in the Garden State. However, the $216.8m generated in April is 6.3% behind $231.5m last year.

Physical slot machine revenue declined by 6.4% to $158.8m while land-based table games revenue also fell 6.1% to $58.1m.

Further igaming success for New Jersey
Turning to the igaming sector, the situation is very different. Revenue from all igaming in April hit $187.9m, up 18.2% year-on-year. This means igaming was only $28.9m behind the long-established land-based segment in April.

Some $185.6m of all igaming revenue was attributed to online slot games, with revenue here rising 18.5% to $185.6m. However, revenue from peer-to-peer poker slipped 0.5% to $2.3m.

As for individual operators. Golden Nugget leapt from third place to take top spot in New Jersey in April. Posting igaming revenue of $53.1m, this is 27.5% ahead of the previous year.

Resorts Digital retained second place with $47.5m, up 13.9% year-on-year. Borgata, which was top in March, followed in third on $44.1m, a rise of 2.2%.

Sports betting revenue almost doubles to $106.2m
Looking now to the sports betting market, revenue here jumped by 46.9% year-on-year to $106.2m. This is also 74.1% ahead of $61.0m in March this year.

The year-on-year revenue rise was helped by a 12.6% increase in handle, with this reaching $1.044bn in April. Player spend on online sports betting hit $1.01bn and retail sportsbooks $34.7m.

Meadowlands remains the runaway leader in the New Jersey sports betting market, posting $73.2m in revenue, up 92.2% on 2023. Meadowlands works with Flutter Entertainment-owned FanDuel.

Resorts Digital and partner DraftKings placed a distant second with $18.9m in revenue, down 6.6%. Borgata and BetMGM took third on $5.2m, a drop of 21.6%.

New Jersey gambling revenue surpasses $2.00bn in four months
As for the year-to-date, total gambling revenue in New Jersey hit $2.06bn in the four months to the end of April. This is 14.4% more than in the same period last year.

Land-based revenue was down 1.6% at $872.9m, with declines across both slots and table games.

Igaming revenue was 21.1% higher at $750.7m, driven by a 21.5% rise in slots revenue to $741.3m. In contrast, peer-to-peer poker revenue declined 3.7% to $9.4m

As for sports betting, the four-month total hit $434.2m. This is up 48.6% from $292.3m in 2023, with players spending a total of $5.17bn in the process.

The Kansspelautoriteit (KSA), the gambling regulator in the Netherlands, has presented its supervisory agenda for 2024, citing four areas of focus.
KSA Netherlands
Looking to achieve its mission of “safe gaming”, the KSA says it will increase its protection of vulnerable players in the Netherlands by looking to prevent addiction. The country took measures to do this in 2023, including the introduction of a ban on most forms of advertising.

The KSA is also looking to combat illegal online offerings, aiming for at least 90% of players to gamble with legal providers in the Netherlands. In a December article for iGB, Yield Sec chief executive Ismail Vali noted how the KSA’s current approach appeared to lack clear success in actual enforcement terms.

The KSA is vowing to further support partners, including the police and tax authorities, on investigations in the physical domain. The regulator hopes this will lead to less “undermining” between different organisations.

The KSA’s final area of emphasis is on compliance with data provision. The KSA wants data to be provided in a “timely, complete and correct manner”. This will then make it easier for the KSA to swiftly -identify any potential wrongdoing.

Growing focus on problem gambling in the Netherlands
Netherlands KSA
THE NETHERLANDS INTRODUCED A NEAR-TOTAL BAN ON ADVERTISING IN 2023
Earlier this month, a motion to completely prohibit gambling advertising in the Netherlands was submitted by Derk Boswijk of the Christian Democratic Appeal (CDA) party. While the move to go further than the 2023 ban on untargeted advertising ultimately failed, its proposal was the latest indicator of the rising concern over gambling harms in the Netherlands.

In December, the Netherlands minister for legal protection Franc Weerwind announced measures he hoped would protect players from problem gambling.

Weerwind’s measures included providers being required to contact players who have set a deposit limit of €350 (£303/$386). Operators should inform such players of the risks of gambling in such high amounts.

The KSA’s consultations for an update to the Responsible Gaming Policy Rules ended in early-February. The aim is to publish the new rules in April.

In October, Weerwind also announced a multi-year digital resilience campaign programme to combat fraud associated with online gambling.

The industry has hit back against some of Weerwind’s proposals, though. Peter-Paul de Goeij, chairman of the Dutch Online Gambling Association (NOGA), warned Weerwind that his plans could lead to gambling being seen as “unattractive”.

Helma Lodders, chairman of the Licensed Dutch Online Gaming Providers (VNLOK), highlighted two areas of Weerwind’s letter that need examination.

“Firstly, that imposed measures are actually effective in keeping the number of problem players as small as possible,” Lodders explained.

“Secondly, that the legal offer remains sufficiently attractive for the vast majority of players who participate in a responsible manner. The latter is important to prevent them from returning to the illegal supply.”

Total gross online gambling revenue, comprising igaming and sports betting, amounted to $229.6m. This was 22.6% ahead of $187.3m in Michigan last January but 5.3% less than December’s $242.5m record for total gambling revenue.

Figures include licensed commercial and tribal igaming operators in Michigan.

Gross igaming revenue was 18.4% higher year-on-year, surpassing the $153.7m reported in January 2023. The total also narrowly beat the existing monthly record of $181.4m set in December.

Turning to sports betting, gross receipts here reached $47.7m. This was 40.7% higher than $33.9m in the same month last year but 21.9% less than December’s $61.1m. As for handle, the $577.4m wagered in January was 21.4% higher than in the previous year.

In terms of adjusted gross receipts (AGR), which account for promotional deductions, this hit $183.0m, up 20.7% year-on-year. Adjusted gross igaming revenue climbed 18.7% to $164.2m, with adjusted gross sports betting receipts also up 5.6% to $18.8m.

As for tax, licensed operators paid $31.3m in taxes and payments to the State of Michigan during January. This includes $30.0m in igaming taxes and fee, as well as $1.3m for sports betting,.

In addition, some $8.5m was paid in wagering taxes and municipal services fees to the City of Detroit. This comprised $7.9m in igaming payments and $614,400 in sports betting tax and fees.

Tribal operators also reported making $3.6m in payments to governing bodies in January.

Detroit casino revenue falls in January
The increase in online gambling revenue is in contrast to the decline in the Detroit land-based sector.

Last week, it was revealed Detroit’s three casinos recorded $94.4m in monthly revenue, a year-on-year drop of 8.8%. This was also 18.8% lower than December’s monthly total.

Some $93.9m came from table games and slots, while $500,221 was generated by retail sports betting.

In terms of market share, MGM held 48% in January. MotorCity held 30%, while Hollywood Casino at Greektown took up 22%.

Total handle for January in Maine was $38.1m. This was 13.4% behind $44.0m in December but 1.3% ahead of $37.6m in November, the first month of legal betting.

As for adjusted gross receipts, the January total was 25.0% ahead of $4.4m in December. It also beat the $4.6m generated in the opening month by 19.6%.

Sports betting adjusted gross receipts account for voided and cancelled bets, player winnings and a 0.25% federal excise tax.

In terms of total other tax due to the state, this amounted to $546,099 in January. Maine has a tax on sports betting of 10.0% of adjusted gross receipts.

DraftKings ahead in Maine two-horse race
Netherlands advertising
BILL LD 585 WAS SIGNED IN MAY 2022 TO LEGALISE SPORTS BETTING IN MAINE
Maine currently only has two licensed operators that offer sports betting: DraftKings and Caesars. Both have tribal partnerships in place, in line with Bill LD 585, signed by Governor Janet Mills in May 2022.

DraftKings operates in Maine via a partnership with the Passamaquoddy tribe. In January, this partnership generated $4.7m in adjusted gross receipts from $32.1m, accounting for a large share of the market.

The only other approved operator in Maine is Caesars, which is partnered with three of the Wabanaki nations. These include the Houlton band of Maliseet Indians, Mi’kmaq nation and Penobscot nation.

During January, the Caesars partnership reported $743,762 in adjusted gross receipts. This was from a total monthly betting handle of $6.1m.

Lawmakers propose bills for exclusive tribal gaming rights
Aspire
ATTEMPTS HAVE BEEN MADE BY LAWMAKERS TO PERMIT TRIBES EXCLUSIVE RIGHTS TO OFFER IGAMING
In other news, last month it was announced Maine lawmakers will discuss proposals to permit tribes to have exclusive rights for igaming.

Those backing the proposals were hoping to follow a similar route as sports betting.

The sports bill signed by Mills allows retail and online sports wagering, but internet sports betting can only be run by approved tribes. These tribes can apply for a licence to operate online betting and also partner one online operator each.

Javier Silvania, Curaçao’s minister of finance has released a statement condemning “misinformation” surrounding the region’s new incoming gambling law.
Curaçao gambling bill
The National Ordinance for Games of Chance (LOK) entered the market’s parliament for approval in December. The LOK will overhaul how gambling is regulated in Curaçao.

Currently, Curaçao operates under the existing National Ordinance on Offshore Games of Hazard (NOOGH) legislation.

CURAÇAO’S GAMBLING REGULATION BILL ENTERED PARLIAMENT IN DECEMBER 2023
In a statement released today (11 January), Silvania acknowledged that the LOK’s submission to parliament would naturally generate “wider debate”. However, he made two clarifications regarding the legislative process. The first was the spreading of misinformation, which he warned against.

“First, amidst this entire process we have been all too aware of a significant amount of misinformation, confusion and accuracy, and I strongly urge against the further propagation of unverified rumours or speculation,” said Silvania.

“Full and accurate information can only be guaranteed when issued by either the Ministry [of Finance] itself or the Curaçao Gaming Control Board.”

Ongoing licensing process and milestones
Silvania also confirmed that the current licence issuing process under the NOOGH remains in place.

“Second, and crucially, I would like to clarify that the current process of licence issuance by the GCB under the current legislation remains unchanged meaning that the Critical Milestones published on 20th December 2023 are likewise unaltered,” he continued.

The minister concluded by stating his support for the GCB during the transition.

“The GCB is acting on delegated authority from the Minister in this regard and is fully committed to this process in advance of and until the enactment of the LOK, whenever that may transpire, and the GCB has my full support during this period of transition,” he assured. “To suggest otherwise would be reckless and misleading.”

The Critical Milestones document detailed the Ministry’s process for transitioning from the current framework to the LOK.

A key date in the process is 31 March 2024. From this date, the registration of sub-licences on the GCB portal – and the subsequent application for a direct licence under the NOOGH, if required – will no longer be possible. In addition, no new extensions or renewals of Master Licences will take place after this date.

Renewal of licences

THE CGB STARTED THE APPLICATION PROCESS FOR OPERATORS ON 1 SEPTEMBER 2023
The GCB has also renewed all gambling licences in Curaçao, with the first renewal ceasing in August 2025. The final one will be renewed in January 2025.

From 1 January 2024, licence holders were permitted to begin displaying a Digital Seal on their websites. The GCB, which issues the Digital Seals, will release a dedicated policy on them in the future.

The GCB kicked off the application process for operators on 1 September 2023 by opening its online portal. The portal began accepting account registrations for applicants and sub-licence holders on 1 November.

Both ballots would give tribes exclusive rights to offer retail and online sports betting in California. They were filed with the state’s attorney-general in October 2023.

CALIFORNIA’S SPORTS BETTING BALLOTS WERE FILED WITH THE STATE’S ATTORNEY GENERAL IN OCTOBER 2023
The two ballots name Reeve Collins, co-founder and CEO of Pala Interactive, as the contact for media inquiries. Pala Interactive was founded by the Pala Band of Mission Indians in 2013. It was acquired by Boyd Gaming in November 2022.

Authors of the ballots have been seeking financial support for signature gathering from sports betting operators. However, SBA members – BetMGM, DraftKings, FanDuel and Fanatics Sportsbooks – have said they will not provide funding.

SBA blasts proposed ballots
SBA spokesperson Nathan Click says this is in line with the organisation’s opposition to the measures.

“In the interest of clarity, and consistent with our previously stated opposition to these measures, we can commit that SBA won’t be funding or otherwise supporting either of these sports wagering initiatives,” Click said. “Without significant and widespread tribal support this initiative fails and sets back productive conversations for several years.

“Further, this initiative is constructed to prevent the market from reaching anything close to its potential to the detriment of all stakeholders — commercial operators, Californians, gaming and Revenue Sharing Trust Fund tribes- – while enabling the unregulated illegal market to continue to thrive.

“Finally, the original premise of building a business based off customers acquired illegally through offshore operations falls significantly short of the regulatory standards to which our membership adheres.”

What are the ballots proposing in California?
The first version of one ballot, entitled The Sports Wagering Regulation and Tribal Gaming Protection Act, set out detail proposals. These included tribes submitting 15% of adjusted sports betting gross gaming revenue (GGR) into a tribal wagering revenue sharing trust fund.

Tribes would also contribute 10% of their adjusted sports wagering GGR into the California homelessness and mental health fund. In addition, tribes would need to partner sports betting operators, which would operate as vendors.

THE SPORTS WAGERING REGULATION AND TRIBAL GAMING PROTECTION ACT WAS AMMENDED IN DECEMBER IN AN EFFORT TO GAIN TRIBAL SUPPORT
The initial version was amended in December in an effort to gain tribal support. Changes include that sports wagering could not launch until 1 July 2025. This is slightly earlier than the originally proposed date of 1 September 2025.

Tribes receiving approximately $1.0m (£786,254/€913,395) yearly under current conditions would receive an estimated 15-20 times more under the proposed measures.

Sports betting GGR contributions to the tribal wagering revenue sharing trust fund increased from 15% to 25%. In addition, a requirement for in-person online gambling registration for those outside of a 10-mile radius from a casino will be removed after two years.

Details are sparse on the other ballot proposal, entitled The Tribal Gaming Protection Act. It outlines that sports betting will be offered exclusively through tribes in California.

What can we expect next?
The SBA declaration will come as another blow to ballot backers, with many tribes and other operators have also stated their opposition to the measures.

When the ballots were first published, it was stated Pala Interactive had 180 days to gather the required signatures through random sample.

Backers would need 874,641 for the ballot to be put forward for consideration with voters. Election officials would also need to verify at least 500 signatures. The 2024 election will take place on 5 November.

A PREVIOUS ROUND OF SPORTS BETTING PROPOSALS WERE REJECTED BY VOTERS IN NOVEMBER 2022
The ballots are the latest effort to legalise sports wagering in some form in California. In November 2022, voters rejected sports betting proposals – despite a poll in February 2022 revealing some support for legal sports betting.

In May 2022, it was confirmed a proposition would feature on the ballot. This was to sit alongside another sports betting initiative backed by tribal gaming groups entitled the Tribal Sports Wagering Act Initiative.

However, Democrats in California recommended voters vote against the proposals. Both proposals appeared on the ballot but were ultimately rejected by voters.

The Dutch government is to launch a national campaign to combat digital fraud amid concerns over crimes related to online gambling.

Franc Weerwind, Netherlands’ minister for legal protection, announced a multi-year digital resilience campaign programme to combat fraud associated with online gambling.

Weerwind explained the rationale behind the campaign in response to concerns raised by fellow parliamentarians over match-fixing via social media.

Weerwind said the campaign will initially be aimed at young people. In particular, messaging will help them recognise scams and offers that appear too good to be true.

The minister was responding to questions from SP, CDA and Christian Union MPs about a report from the AD news site which alleged that social media influencers were defrauding victims of thousands of euros via Telegram by helping to promote fake sports results.

Weerwind said there was no evidence that the young people targeted were involved in match-fixing or indeed that any sporting events had actually been fixed. However, he expressed a broad concern that fraudsters are seeking out vulnerable people, such as the young.

Weerwind also said it is “undesirable” for influencers to advertise risky games of chance. He noted that gambling companies are prohibited from using role models that appeal to young people to advertise products.

“Fraud and inciting people to commit criminal acts is harmful and also punishable,” Weerwind wrote. “In this case, this would be done under the guise of ‘making quick money through sports betting’. The so-called manipulated results are purchased from the scammers on Telegram and paid for via cryptocurrency.

“People are being scammed. Awareness about and recognition of online scams by citizens can help prevent victimisation.”

Netherlands gambling social problems

Weerwind responded cautiously to suggestions that the legalisation of online gambling has created or expanded existing social problems. He said he did not wish to pre-judge a review into the impact of the Remote Gaming Act in 2024.

He added: “I have already made adjustments within the given legal frameworks in the past period and will continue to do so. For example, I have banned the use of role models as of 30 June 2022 and untargeted advertising for online gambling as of 1 July 2023. Addiction prevention is central to my policy efforts.”

Earlier this year, the Dutch government said it plans to submit new rules to improve addiction prevention in early 2024. It admitted the current system is flawed.

In addition to the broad digital resilience campaign, the Dutch gambling regulator, KSA, is due to commence work on a scheme that will test how self-exclusion service Cruks’ brand awareness can best be increased among different target groups.

Other initiatives include a programme that identifies and provides guidance for risky or problematic gambling behaviour among young adults. Developed by the Trimbos Institute, a specialist in addressing addiction issues, it will also be delivered in schools from 2024.

igamingbusiness

“The best antidote to the illegal market is a competitive regulated market,” the Betting and Gaming Council’s (BGC) Wes Himes told delegates at the conference last week.

Critics lined up to attack slow progress on regulatory reform in Great Britain, the BGC’s home market after a three-year review and six different gambling ministers. But in Germany, the Gambling Act white paper is held up as a successful, collaborative and proportionate model for fine-tuning gambling regulation.

In a market with blanket online slot stake limits of €1 and where monthly deposits are capped at €1,000 Great Britain’s emphasis on moderating rather than prohibiting activity appeals to many. Many attacked affordability checks as intrusive and excessive, but it provides a personalised compromise that Germany lacks, attendees and panellists suggested.

The strict measures only serve to shore up illegal competition, across the land-based, street and online sectors.

New State Treaty, the same old problems

Chief executive of local licensee Rootz Sam Brown laid bare the impact of re-regulation during a session organised by gambling law specialists Hambach & Hambach. There is a clear parallel between re-regulation and a rise in illegal online play, he explained.

Before the toleration period where businesses adhering to the 2021 State Treaty’s conditions were allowed to operate without a licence, Rootz players deposited €350 on average, Brown explained, and gross revenue per player averaged €141.

By August 2023, however, average customer deposits fell 80% to €150, with GGR per play halved to €73. Around 10% of Rootz’ pre-regulatory business channelled to the regulated market Brown added. “And they haven’t stopped gambling and found another hobby.”

Strict measures such as deposit and staking limits play a big role in the black market boom, he says. Harm prevention should be the ultimate responsibility of the operators Brown added, echoing a point from Himes about GB operators recognising their leading role in player protection.

The operators, not the authorities, not the legislators, hold all the data. Addicted customers are bad for business Brown said, but a personalised approach based on individual players will be more effective than Germany’s blanket restrictions.

This is especially significant if it shifts consumers to illegal sites without safeguards. Brown believes around 80% of online slot play is happening illegally, a far cry from new federal regulator Gemeinsame Glücksspielbehörde der Länder’s (GGL) claims of high channelisation.

Black and white markets powered by the same providers

Hambach & Hambach salary partner Yannick Skulsky pointed out slot sites – somewhat counter-intuitively – cannot be marketed as casino. Furthermore, regulations make it incredibly difficult for legal operators to roll out new titles, and very easy (and lucrative) for black market counterparts to do the same.

For the legal market, individual games must be certified. An operator needs a licence to offer slots, then specific permission for each game. The GGL, which carries out its testing internally, has scope to hire around 150 staff. It currently employs around half that number, a mixture of part- and full-time employees. There is inevitably a backlog for slot certification.

However there is no B2B licensing. A game could be certified and launched by one licensee, while another still awaits permission. Or a slot studio could have its legal roll-out delayed with one licensed client while the revenue flows in through an unlicensed brand.

Player claims and Malta’s Bill 55

It seems attempts by players to recoup gambling losses from unlicensed brands isn’t much of a deterrent, either.

Courts and customers in Germany continue to pursue operators for losses incurred during Germany’s long delays in implementing its State Treaty. Austrian lawyers are even trying to file claims against individual executives and directors.

Hambach & Hambach founding partner Claus Hambach believes this situation – one he admits feels quite surreal – is beginning to rationalise. While state high courts rule in favour of the players, a Supreme Court ruling possibly changes the outlook.

It threw out a claim to recoup losses from a payment provider, predominantly on the basis that the player was gambling. They knew money was at risk. Further, it noted the contact between the player and the operator could not be voided as both parties, by placing and accepting the bets, were effectively breaking the law formally.

Hambach sees a legal article published by German civil law expert Professor H Köhler as the way forward. There are only three factors that should prompt an operator to return losses to a player, Professor Köhler argues.

Any losses incurred by minors should be refunded, and players able to prove they were misled by a brand pretending to be licensed would be eligible. Those suffering from gambling addiction would also be able to claim back losses, if they are able to provide medical proof of their condition.

Malta’s attempt to protect its licensees from these cases, Bill 55, is viewed as bigger than a gambling matter by conference delegates. But not only will the European Commission look into Malta`s legislative approach but the European Court of Justice will also evaluate Germany’s disputed Interstate Treaty on Gambling, which is the basis for the claims in the first place (Case C-440/23).

Germany’s omnichannel black market

However illegal play is prevalent across all channels. The illegal gaming machine market is growing, and unlicensed Kaffe Kasinos are on the rise, warned Burkhard Blienert of the Federal Council on Addiction and Drug Issues.

Law enforcement experts pointed out illegal gambling is relatively low risk for criminal groups and remains highly profitable and a popular method of money laundering. It is also easy to manipulate legal devices or build approximations of traditional gambling devices – several primitive slots and even a variant of roulette seized by the police were on display.

However from government level there remains a desire to tackle illegal gambling in tandem with strict controls on the regulated market. For example Blienert argued sports betting advertising was as much a threat as illegal gambling and loot boxes, amid debate on whether TV ads, football sponsorship and other branding should be limited or banned similar to Great Britain.

However Gauselmann Group director Manfred Stoffers took a contrasting view. Player protection is raised by regulation, he argued. If an activity happens in the open, it can be monitored and controlled.

But two years on from the GGL taking charge of igaming regulation, operators and associations argue Germany’s strict regulatory measures are only benefitting the black market.

igamingbusiness