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Germany to scrap betting licence cap and review online casino ban

The Prime Ministers of Germany's 16 states have taken a step towards overhauling the country’s State Treaty on Gambling after deciding to scrap the limit on the number of available licences, while also hinting at online casino regulation.

Dropping the 20 licence limit means that applications will be judged on a qualitative, rather than quantitative basis, with any operator that can fulfil the licensing terms eligible for licensure.

The decision was taken Friday at the annual conference of ministers held in the state of Mecklenburg-Vorpommern.

As a result, Germany can finally issue online sports betting licences under the  State Treaty, which came into force in 2012 and has been widely discredited in a number of damning court rulings.

As well as lifting the licence cap, the Prime Ministers are also examining the prospect of setting a loss limit of €1,000 per player, inviting additional proposals on this from regulatory bodies.

Operator association the Deutsche Sportwettenverband (DSWV) welcomed the agreement, calling it an important step forward for regulatory progress in the country.

"The agreement of the Prime Ministers sounds hopeful to us,” DSWV president Mathias Dahms said. "For years, sports betting providers have emphasized that a limitation of the number of concessions is unconstitutional and in contravention of European law.

"With the introduction of a genuine authorisation system, legal certainty can finally be established," he said.

He hailed the fact that the agreement represents a step towards change across Germany, rather than on a state-by-state basis.

"It is a good thing that we are now heading for nationwide progress through the unification of the Prime Ministers."

He added, however, that this is only one step towards a satisfactory system. The promises will have to be followed by tangible action, he said, in order to ensure an EU-compliant model.

The Prime Ministers’ decision has even drawn praise from the Deutsche Lotto und Totoblock (DLTB), one of the current Treaty’s staunchest supporters.

The association of state lotteries said that it welcomed the agreed change in sports betting regulation following “long and controversial debates.”

“We expect this agreement to contribute to the necessary stabilization of the sports betting market and clarity about legal providers in the sports betting sector,” DLTB chair Michael Heinrich said. “This is urgently needed."

Perhaps most intriguingly, the lawmakers have decided to also analyse the country’s online casino market, examining regulatory frameworks in other countries with a view to altering the current prohibition. However, this has been interpreted in different ways by different parties.

The DLTB believes that the Prime Ministers are aiming to find new ways to tighten the existing ban, pledging to play an “active and constructive role” in the review, while newly-formed casino body the Deutsche Online Casinoverband (DOCV) sees it as a push towards legal online casino gaming.

“It is a good sign that all parties have recognized the realities of a digital and networked market,” DOCV president Dr Dirk Quermann said. “Now this market has to be managed quickly. We need regulation of online casino offers according to qualitative criteria.

“According to the political objectives of the State Treaty, there is a need to channel demand to the serious providers, which can guarantee reliable protection measures.”

The association has put itself forward as a sounding board for the Prime Ministers, highlighting its members’ experience in a range of regulated European markets.

“We are glad to provide this experience and our technical knowledge about the function of the market in an open dialogue,” Quermann said.

Despite the Prime Ministers agreeing on a number of issues, it is likely to be a while before changes to the State Treaty can be enforced. The proposed alterations will have to go through a notification and ratification process in the country’s parliament, with the DLTB estimating that it could take until January 1st 2018 for these alterations to be made.

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