Germany has a complicated recent history of rules and regulations regarding gambling and online casinos, but the updated Interstate Gambling Treaty (ISTG 2021) offers some new licensing possibilities for the industry. This new treaty also outlines rules regarding gambling advertising, permit conditions and rates. Licenses issued under the new provisions will be valid throughout Germany. The German permit is a significant change from the old law, which was usually a restrictive element for online gambling, and the German state of Schleswig-Holstein, which has issued several gambling permits to online casino companies that are not available in other federal states.
New rules for German online entertainment cities
For many years, gambling laws in Germany have been highly restrictive. With recent developments in the industry, it has become clear that online casinos and other gambling establishments need to be regulated. For this reason, in early 2020, the German Head of State approved new gambling rules and regulations for online casinos and online poker. These new rules came into effect on 1 July 2021. However, although the regulatory framework will be less restrictive than before, the law contains restrictive elements.
Restrictive elements are designed to provide protection to players and prevent gambling addiction. These restrictions include limits on spin bets, strict advertising laws (as described below), restrictions on in-game sports betting (only on the next scorer or final result), and the number of bets that can be placed on a slot machine at one time will be limited. In addition, customers will be limited in the amount of deposits they can make each month. This limit is a maximum of €1,000.00 per month and measures will be taken to monitor the provider in this manner. Online casino platforms that violate these rules may face license revocation and other sanctions.
With these rules and restrictions in place, companies in the online gambling industry should certainly consult with experienced German legal professionals in advance to ensure they are in compliance. At Schlun & Elseven Rechtsanwälte, our legal team will support you in any legal disputes relating to the new German online gambling law.
New Permit Law for Online Casino and Online Casino in Germany
The update of the license rules means that those companies that are granted a license will be able to operate throughout Germany. ISTG 2021 generally allows private companies to apply for licenses to offer sports betting, virtual slots and online poker. The German Gambling Code defines gambling as a game of chance and for an activity to be considered a game of chance it needs to contain three elements.
- There is value in considering.
- The determination of the award is entirely or primarily a matter of chance.
- Consider it for the chance to win.
However, certain aspects of the licensing process, particularly for online casino games, will be determined by the laws of the respective federal states. The licensing regulations will likely be modeled after the laws associated with more traditional land-based casino operations.
The new Interstate Gambling Treaty introduces a new national gambling regulator to be based in the German state of Saxony-Anhalt. This body will be responsible for issuing organiser permits and will be represented by the Saxony-Anhalt State Administration Office in Halle. Applications for these organizer licenses can be made by applicants located in EU member states or the European Economic Area. At Schlun & Elseven Rechtsanwälte, our attorneys will supervise the application and ensure that your application meets the requirements of the new law. Please feel free to contact one of our lawyers for further professional advice.
New advertising rules for online gambling in Germany
Although the new gambling rules offer some liberalization of German law, there are strict restrictions on gambling advertising. The German states hope that these restrictions will help to reduce the impact of advertising on young people in particular. Therefore, online gambling platform advertisements are not allowed between 06:00 and 21:00. Advertisements also cannot target minors or certain categories of vulnerable people. In addition, the new law also prohibits platforms from cross-advertising, for example, when users use their sports betting platforms, they cannot advertise their online casinos.
There will also be advertisements for rules related to sports gambling. Advertisements for wagering prior to or during live sports events will not be permitted on the same broadcast channel. While jersey sponsorship and other general sponsorship of sports teams will still be permitted, there are restrictions on the use of current athletes to promote sportsbooks.
Misleading advertising related to online casinos and advertising gambling as a means of solving financial problems is also not permitted. Direct and targeted advertising via text message and telephone is also strictly limited by law.
Why are new online entertainment regulations and rules being introduced in Germany?
For many years, online casinos and online casinos have been in a gray area in Germany. This has led to legal disputes and conflicting views among the federal states. Prior to 2008, gambling was not regulated as it is today; however, the German states subsequently attempted to restrict online gambling. The Glücksspielstaatsvertrag (Interstate Gambling Treaty) was introduced to find a new legal solution. However, the 16 federal states were divided as Schleswig-Holstein decided to grant six-year gambling licenses to several companies, including Ladbrokes, Bwin and others. After the initial licenses, Schleswig-Holstein withdrew from additional licenses and largely adopted the current legislation.
It has been difficult to reach this stage because different states in Germany have different views on online gambling. The agreement between the states has led to a compromise solution that is now in place. States such as Schleswig-Holstein advocate more liberalised laws, while other states oppose them.
The desire to protect customers from some of the risks of online gambling is understandable, but the failure to provide a solid legal basis for online casinos and other forms of gambling in Germany has resulted in customers using black market providers. This has allowed a significant amount of the profits from online gambling to leave Germany. Trying to prohibit or severely restrict online gambling has been a difficult task in the Internet era. It is hoped that determined customers of gambling have been able to circumvent the obstacles.
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