Germany kicks off online casino market with state treaty

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The German government has implemented a new state gambling treaty officially legalizing online casino 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 has implemented its state gambling treaty, otherwise known as Der Glücksspielneuregulierungsstaatsvertrag (GlüNeuRStV), officially legalizing online casino and poker nationwide.

the treaty will also create a new regulatory body

The GlüNeuRStV received approval from the 16th and last German state in April this year. It came into force 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 establishes regulations for iGaming operators, including a controversial 5.3% turnover tax for slots and poker. It also includes restrictions on slots, such as bet and deposit limits, and additional sports betting measures related to in-play betting.

Industry expresses concern

In a press release published on its website on 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 the severity against the black sheep.”

To do this, DSWV Chairman Mathias Dahms said legislation needed to be further developed to eliminate the existing problems. He specifically pointed to limits on legal operators and “excessive taxation” 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 games. Each player must adhere to a bet limit of €1 ($1.18), while slot machines can only have a spin speed of five seconds. The legislation also prohibits jackpots and will not allow players to play multiple slot machines simultaneously. Additionally, 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 betting other than betting on the final result or next goalscorer. Dahms criticized the measure, noting that live betting accounts for around 60% of all bets in Germany.

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

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 companies as long as they adhere to new federal gambling treaty rules.

free ticket for illegal suppliers.

Speaking last year, Hans-Jürgen Rumpf, chairman of Germany’s gambling addiction advisory board, described the 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.

Although they agree on tolerance, German lawmakers have tried to crack down on illegal sites in the past. These efforts focused primarily on blocking payments to illegal gambling platforms. In 2019, PayPal announced that it would stop processing payments from German customers to offshore gambling 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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