Germany agrees transitional amnesty for online casinos

Despite opposition from some states, an agreement has been reached to tolerate unregulated online gaming ahead of new legislation next year.

Germany.- The country’s 16 federal states have reached an agreement on transitional regulations that will tolerate the presence of online casino gambling prior to the introduction of regulation next year.

According to German press, the state and senate chancelleries of the 16 states have agreed to not to take action against online slots currently offered on the unregulated market, provided they adhere to the rules contained in the legislation that will govern the new regulated market from next summer. 

The idea of the amnesty was first put forward in July. It has gained the support of operators such as GVC.

The latest amendment to Germany’s Interstate Treaty on Gambling is due to regulate online casino gaming from July 1, 2021. There has been much dispute over what to do in the meantime with operators who offer products on the currently unregulated market.

Some states have been in favour of allowing operators to continue on the assumption they will be regulated in what is now less than a year’s time, while others have insisted that operators offering online casino to German players should still be pursued and shut down up until the regulated market goes live.

The only state where online casino gaming is already legal is Schleswig-Holstein in the north, but many operators have been offering products nationwide for years. 

Saarland, Saxony-Anhalt and Bremen are the states that have been most opposed to permitting a transitional period.

They claimed players would not be adequately protected and that a transition period would create a situation that would be difficult to reverse should Germany finally decide not to ratify its planned igaming legislation. 

The legislation is currently subject to an extended standstill period while it is examined by the European Commission. 

However, the opposing states have now agreed to allow a transition period in order to adopt a uniform procedure and avoid the risk that the legislation itself collapses.

That will effectively establish an amnesty for existing operators and provide a way to smooth the way to licence applications next year.

The states have said they will publish clarification soon on what is expected of operators currently offering products on the unregulated market, but it is understood that they will be expected to introduce the terms of the future legislation.

That includes strict limits on deposits and stakes and an obligation for players to have separate accounts for different verticals. 

Those operators who do not adopt the future rules risk being classified as “unreliable” for future licensing decisions and could risk being excluded when licences are granted next year.

The effects of the resolution will be monitored and counter measures could be taken in the event of negative results, the state chancellery of Saarland said. 

It is not yet clear how the move will be legally implemented and it appears that it will be largely discretionary. 

The State Chancellery of North Rhine-Westphalia has said the aim is to redirect enforcement action against operators who show no intention of complying with the future regulations. 

Several states have recently taken action against operators in the unregulated market.

Lower Saxony has tried to prevent payments, Saarland has taken action against advertising,and Hamburg has filed criminal charges against the providers Bwin, Tipico and Bet3000.

The agreement to now tolerate possible future licence holders’ presences has gone down badly with problem gambling groups.

Hans-Jürgen Rumpf, chairman of the national advisory board for gambling addiction, said it offered a “free ticket for illegal providers” who would now be rewarded for having operated for so long in the unregulated market.