A new amended State Treaty on Gambling has been ratified by the Minister-Presidents of Germany’s 16 federal states allowing licensing for sports betting licenses to begin.
The treaty must be ratified by the European Union, which is expected to act quickly allowing the application process to begin.
Initial licensing will run from January 1, 2020, to June 30, 2021 while the country completes an updating of gambling regulations.
The new state treaty has seen few changes since previous amendments were made in 2012. No limit is set on licenses and operators will be taxed 5 percent on turnover. In-play betting is prohibited, and players will not be allowed to spend more than €1,000 each month. The treaty only allows sports betting.
Meanwhile, the German state of Schleswig-Holstein will be allowed to run its own regulatory regime until 2021. The state taxes operators at 20 percent of gross revenue.
Hans-Jörn Arp, parliamentary leader of the Christian Democratic Union in Schleswig-Holstein and one of the State Treaty’s most vocal opponents, described the agreement as a “breakthrough”.
“Today’s decision of the Minister President Conference to present the foundations for follow-up regulations to the State Treaty on Gambling, means we have finally achieved a breakthrough after ten years, and gained recognition from the other federal states,” Arp said. In a press release.
“For Schleswig-Holstein, this is a great success, after the state had long met with resistance to its forward-looking solution in the field of gambling,” he said. “Now the other federal states are pulling in the same direction, after they were finally convinced that the Schleswig-Holstein model is expedient.”
However German operator association the Deutscher Sportwettenverband President Mathias Dahms said the treaty is an insufficient first step towards regulating the country’s sports betting market.
“The third amendment to the State Treaty on Gaming is only a temporary measure for the short transitional period until 2021,” Dahms said in a statement. “It does not solve the structural deficits of the State Treaty, but gives the countries time to continue negotiating the urgently needed modernization of German gambling law.”
Dahms said that even as a short-term measure the restrictions imposed under the State Treaty would prompt bettors to bet at illegal sites.
“In Germany there is a strong sports betting market,” he said. “Customers have clear expectations of their sports betting product. If states completely ignore social realities and customer demand, they run the risk of failing again with their regulation. Unattractive conditions threaten to marginalize the licensed offerings in Germany compared to the black market.”
Dahms said that a thorough and transparent process to develop new regulations was vital, one that involved industry stakeholders, sports clubs, as well as medical professionals addressing problem gambling.
