Gaming in Germany online event | Regulatory update & policy principles
On July 1, 2021 the new German State Gambling Treaty is expected to enter into force. The treaty will legalize online gambling – including poker and virtual slots – throughout the country for the first time.
While the new State Gambling Treaty (GlüStV 2021) has been finalized and is currently under consideration by the federal state parliaments, many central aspects of the new regulation, such as tax rates and operator reliability criteria, are yet to be determined. Similarly, the responsible gaming obligations of future-licensed operators have not yet been fully clarified.
As developments are moving fast, more information on these crucial aspects of the new gambling regulatory framework is expected to be available by the end of April.
To learn more of what to expect of the regulated online German gambling market, tune in on April 21 at 15:00 CET for the Gaming in Germany online event “Regulatory update & policy principles.”
Join us for a high-level conversation on German gambling policy choices and their expected implementation.
- Prof. Dr. Tilman Becker, Managing Director of the Gambling Research Center at the University of Hohenheim
- Dr. Jörg Hofmann, Head of the Gaming & Betting Law Practice Group at Melchers Law Firm
Register today: https://bit.ly/3fdOwag
The following events may be of interest to the Gaming in Germany community.
- The third edition of CasinoBeats Summit will return to Malta from 13 – 15 July, 2021, as part of Summer iGaming Week organized in partnership with KPMG and Gaming Malta.
- iGB Live and iGB Affiliate have also been moved to 28 September – 1 October, 2021, but will still take place in Amsterdam!
- The 2021 Gaming in Holland Conference has been scheduled for 1 October, 2021 – the very day that the regulated Dutch online market finally opens. Netherlands Gambling Authority chairman René Jansen has agreed to deliver the keynote speech. Save the date!
- SiGMA Europe has been rescheduled to 16 – 18 November, 2021.
- The Betting on Sports America conference and expo has been scheduled for 30 November – 2 December, 2021 and will bring together all the major players in the fast-growing North American sports betting industry.
- The World Gaming Executive Summit is returning live on 6 – 8 December, 2021 at the W Hotel, Barcelona.
- ICE London and iGB Affiliate London have been postponed to 1 – 3 February, 2022.
The „European Association for the Study of Gambling (EASG)“ has announced two new online events. On April 15 at 11:00 CET, the EASG will present a online event on match-fixing and integrity, followed on April 22 at 11:00 CET by a online event on Covid-19 and problem gambling.
Germany iGaming update
Germany is currently on track to legalize online gambling. The new State Gambling Treaty (GlüStV 2021) that will make this possible is projected to enter into force on July 1, 2021.
The GlüStV 2021 is a treaty between the German federal states. In order to enter into force, the treaty must be ratified by thirteen of sixteen state parliaments.
As of Thursday, thirteen states have indeed ratified the treaty. Only Nordrhein-Westfalen (NRW), Saarland, and Sachsen-Anhalt have not made a final decision yet.
NRW and Sachsen-Anhalt will almost certainly support the GlüStV 2021, leaving Saarland as the biggest question mark.
However, even if the three remaining states would refuse to ratify the treaty, the GlüStV 2021 would still enter into force in the rest of the country.
The new regulations mandate that licensed operators connect to three separate databases:
- a central player exclusion register (OASIS)
- a data vault containing operator and aggregate player data
- a central database for managing player deposit limits across all operators and which prevents players from logging in with more than one operator at a time
The state of Sachsen-Anhalt, seat of Germany’s future national gambling regulator, recently published information regarding these databases.
At present, it is expected that licensed operators must be ready to connect to these databases from July onward.
Further licensing conditions, e.g., regarding operator reliability, are expected to be announced in Q2.
According to the latest proposals tabled by the state of Nordrhein-Westfalen (NRW), virtual slot machines and poker would both face a 5.3% turnover tax – the same percentage that is currently being withheld on each sports betting wager.
With a turnover tax of 5.3%, licensed operators of virtual slot machines will need to lower their payout ratios from ca. 96% (as is common) to ca. 90%. This difference is significant enough to make it extremely hard for German licensed operators to compete with their international peers and player channelization rates are expected to suffer accordingly.
As the plan tabled by NRW is already a political compromise – initially the tax rate for virtual slot machines was to be 8% – further revisions are unlikely.
Germany-licensed operators of virtual slot machines will thus face an uphill battle from the start, especially as the new deposit and stake limits under the current transitional regime already had a severely negative impact on the revenue of several large international operators.
The state of Sachsen-Anhalt will be the home of Germany’s future national gambling regulator. The regulator will officially start operating from July 1, 2021, initially with a staff of ca. 24 FTE.
The new regulator will initially focus on the implementation of the aforementioned player and operator monitoring databases.
Considering the limited resources of the regulator, it remains unclear how the new regulator will fulfill its other tasks, such as licensing and combating illegal offerings.