Germany launches online casino market with state treaty

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The German government has put in place a new state gambling treaty officially legalizing online casinos and poker across the country, while introducing a list of new restrictions for operators. [Image: Shutterstock.com]

A historic day in Germany

For the first time in history, players in Germany can legally play their favorite casino games online. The country implemented its state gambling treaty, also known as Der Glücksspielneuregulierungsstaatsvertrag (GlüNeuRStV), officially legalizing online casinos and poker nationwide.

the treaty will also create a new regulatory body

The GlüNeuRStV received approval from the 16th and last German Land in April this year. It went into effect on Thursday, expanding the country’s gambling options beyond online sports betting. The treaty will also create a new regulatory body to oversee the industry from 2022.

The treaty sets regulations for iGaming operators, including a controversial 5.3% turnover tax for slots and poker. It also includes slots restrictions, such as wagering and deposit limits, and additional sports betting measures related to in-game betting.

Industry expresses concern

In a press release on its website Wednesday, the German Sports Betting Association (DSWV) welcomed the implementation of the State Treaty on Gambling. However, the industry body urged state officials to “protect approved suppliers and act with all severity against black sheep.”

To do this, DSWV chairman Mathias Dahms said legislation needs to be further developed to eliminate existing problems. He highlighted in particular the limits imposed on legal operators and “excessive charges” as areas of the Treaty in need of correction.

In addition to the 5.3% tax rate, the state treaty includes a number of restrictions for slot machine games. Each player must meet a wagering limit of € 1 ($ 1.18), while slot machines can only have a spin speed of five seconds. The law also prohibits jackpots and will not allow players to play multiple slot machines simultaneously. In addition, the GlüNeuRStV imposes an aggregate deposit limit of € 1,000 ($ 1,209) per month on all player accounts.

Apart from online casino games, the legislation adds additional restrictions for sports betting. This includes a ban on all live bets other than those wagered on the final result or next scorer. Dahms criticized the measure, noting that live betting accounts for around 60% of all betting in Germany.

In Wednesday’s press release, the DSWV chairman also urged authorities to crack down on unlicensed gambling across Germany. “A market in which some unlicensed companies continue to operate undisturbed undermines the political objectives of countries and must be prevented by all means,” he commented.

Lawmakers agree on tolerance

Despite the implementation of the state gambling treaty on Thursday, some unlicensed online casino operators can still take bets under German law. Last year, the Senate and state chancelleries of Germany’s 16 federal states agreed to tolerate unlicensed businesses as long as they adhere to the new rules of the Federal Gambling Treaty.

free ticket for illegal suppliers.

Speaking last year, Hans-Jürgen Rumpf, chairman of the advisory board for gambling addiction in Germany, described leniency as a “free ticket for illegal providers”. He warned that the tolerance would reward companies for operating illegally in the German market for many years before.

Despite agreeing on tolerance, German lawmakers have tried to crack down on illegal sites in the past. These efforts have mainly focused on blocking payments to illegal gaming platforms. In 2019, PayPal announced that it would stop processing payments from German customers to offshore gaming sites. Meanwhile, under pressure from German authorities last year, Visa also banned German online casino sites from processing deposits and withdrawals from its credit cards.

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