Restrictive German Online Market Causing Exodus Of Gambling Sites

Home » Poker News » Restrictive German Online Market Causing Exodus Of Gambling Sites

Thursday, January 29th, 2015 | Written by Lucy Brown

Germany’s online gambling market is one of the most restrictive in the whole of Europe, with the federal government only permitting online sports betting and lotteries, whilst prohibiting all poker and casino sites from operating inside the country of 80 million people. In the past, individual states have attempted to break rank, most noticeably Schleswig-Holstein which issued a number of online casino and poker site operating licenses in 2012, but was subsequently forced to bow down to federal regulations a short while later. Consequently, a number of major online casino sites have now decided to call it a day and decided to exit the Germany market at the start of February.

E-mail Sent To German Customers

According to an e-mail sent out to German customers, a group of high profile casino sites have all said they will now prevent new German players from joining their sites to play real money games starting February 1st, although play money accounts will still be available. The sites leaving Germany include Casino.com, MansionCasino.com, LesAcasino.com, Club777.com, and SlotsHeaven.com, which are all operated using Playtech software and suggest the sudden move is related to the restrictive regulatory situation which exists in Germany. As an extract of the e-mail reads:

“We regret to inform you that.. a closure [will begin] in the German market for all brands. All accounts will have to be stopped no later than January 30th, 2015.”

Lotteries and Sports Betting Only

In 2012, the state of Schleswig-Holstein attempted to challenge the federal government’s monopoly over sports betting and lotteries by issuing sports betting licenses of its own, as well as online casino and poker site licenses to several major gambling operators, including 888, Ladbrokes, Betfair, and Bet365. At the time Bwin.party, which maintains a strong presence in Germany’s betting market, commented:

“The resolution passed today is an important and groundbreaking step on the way to an open and regulated gambling market in Germany. We are now hopeful that the other 15 German States will make the regulated amendments to their proposed State Treaty, in order to bring it into line with EU law.”

In spite of the state’s new regulations gaining approval from the EU Commission, however, Schleswig-Holstein has since repealed its new gambling law to be in step with Germany’s Intestate Treaty on Gambling 2012 (ISTG), which outlaws online gambling and poker in Germany.

No Specific Reason For Exit Mentioned

Although no specific statement has been given as to the gambling operators’ reason for leaving Germany, there is fairly compelling evidence their decision is related to a landmark court ruling concerning a 25-year-old German online gambler earlier this month. The unnamed man was found guilty by the District Court of Munich of participating in “unlawful gaming”, and as a result not only had €63,490 of his online winnings confiscated by the German Financial Services Authorities, but was also further saddled with a €2,100 fine for violating Section 285 of Germany´s Criminal Code, which states:

“Whosoever participates in a public game of chance (Section 284) shall be liable to imprisonment not exceeding six months or a fine not exceeding 180 daily units.”

Apparently, the man was first targeted by the Financial Services Authorities after trying to withdraw his €201,500 in blackjack winnings from his bank account in 2011, in the form of five sizable withdrawals.

Ignorance Defense Ignored

The landmark case represented the very first time an individual had been penalized for playing on an unlicensed iGaming site in Germany, and signaled a frightening intent by the government to target not only gambling operators but also the individuals who play on them.

Arguing his case, the unnamed 25 year-old tried to convince the court he was unaware internet gambling was forbidden in Germany, citing the examples of German sports personalities, such as Boris Becker (PokerStars) and FC Bayern Munich (bwin), appearing on advertisements promoting online gambling sites in Germany. Dismissing the argument, though, the Munich District Court judge pointed out these promotional examples related to legal sports betting only, stating:

“Even a layman knows the difference between sports betting and blackjack. The European Court has ruled that in the specific case of gambling, public authorities have a degree of additional control in determining the requirements arising from the protection of consumers and social order, and that it is up to each Member State to assess whether it is necessary to ban gambling and betting activities wholly or in part, or whether it is sufficient to limit and control them.”