ECJ Backs German Gambling Treaty

Germany’s interstate compact on gambling mandates strict limits on commercial competition everywhere but in Schleswig-Holstein, which has taken a more liberal approach. Digibet argued that nullified the treaty, but the European Court of Justice said no.

The European Court of Justice has ruled that Germany’s strict regulation of online gambling was justified even though one state, Schleswig-Holstein, had eased rules barring foreign competition in the country’s highly protected national market.

Gibraltar-licensed Digibet took the case to the court after it was blocked from offering online gambling in Germany, claiming it was shut out in violation of European Union guarantees of free trade within the Common Market.

The case hinged on whether Germany’s interstate treaty governing gambling is unconstitutional because Schleswig-Holstein is not a party to it. The court ruled no. “The 15 remaining states were not required to change their rules just because a single state had pursued a more liberal policy for a limited time,” it said in a statement.

The court did not, however, address the issue of whether the treaty is in compliance with EU law. That is subject to another referral by the German court of Sonthofen to be decided in 2015.