Online gambling out in the cold in Germany

Germany is to buck the European trend on internet gambling, preferring the prohibition route rather than regulation, it appears from reports this week.

Germany’s sixteen Lander, or provinces, have been fiercely debating a new Interstate Treaty on gambling for the past two years with positions that vary from outright bans to the more progressive licensing and regulation chosen by Schleswig Holstein .

Doubts about the EU acceptability of various proposals have further complicated the picture, and still remain a concern among a number of German politicians.

However, the 13-Lander minimum threshold required to breathe life into the new Treaty was reached last week when Thuringia and Mecklenburg-Vorpommern agreed to the proposed four-year new treaty, seemingly making implementation inevitable on July 1 2012.

Provincial legislators were perhaps also encouraged by the recent change of government in Schleswig Holstein to a coalition with an anti-online gambling bias that has threatened to abandon the maverick province’s enlightened approach, although that could result in expensive legal actions brought by the 7 major companies that have invested in the SH policy and already hold licenses (many others are in the application pipeline).

The new Treaty is only slightly less restrictive than the old; it allows for 20 private sports betting licenses priced at a hefty Euro 40 – 60 million apiece, and carrying a turnover tax of 5 percent.

But online gambling offered by private operators remains banned, as was the case previously.