- Four questions posed to CJEU regarding compatibility of its online gambling law with EU law.
- Suitability in question given its contradictory state and federal laws, with Schleswig-Holstein’s state law more liberal than the State Treaty.
- Germany court maintains that its restrictive system is suitable if it can be justified for “legitimate public interest.”
The German Federal Court ruled to suspend its decision on the legality of its State Treaty on Gaming, Thursday, with questions submitted to the Court of Justice for the European Union (CJEU) regarding the consistency of its gambling framework.
The restrictive online gaming treaty, now ratified by all 16 states, permits only 20 license for online sports betting and maintains online casino and poker games as unregulated.
Such restrictions are arguably inconsistent with free trade laws in the EU. The European Gaming and Betting Association (EGBA) previously urged the European Commission to judge its complaint on the “highly contentious” German system. It is one of nine member states with pending cases of infringement.
However, in a press release today, the German Court maintains that, as per CJEU case law, such restrictions on gambling activities are acceptable if they can be justified as existing for “legitimate public interest.”
The previously published EU Action Plan states much the same.
Member States usually offer legitimate reasons for the restriction of crossborder gambling services,” concluded the report, but warned countries “... must nonetheless demonstrate the suitability and necessity of the measure in question, in particular the existence of a problem linked to the public interest objective at stake and the consistency of the regulatory system.
It is the question of internal consistency that has lead the German Supreme Court to today defer its decision to the CJEU.
The German state of Schleswig-Holstein (SH) has a separate, more liberal online regulatory system, permitting an unrestricted number of online gambling licenses for sports betting, online casino and online poker. Thirty-six licenses have already been issued.
Although SH ruled today—just hours after the Federal Court decision—to repeal the law and join the state treaty, the licenses will remain valid for their six-year period.
In a series of four questions submitted to the European Commission, the German Court has requested that it rule on whether this inconsistency of state and federal means it is incompatible with EU law.
It also asked that, if Schleswig-Holstein repealed its law—something it voted to do today—this would eliminate the question of consistency.
The case is now suspended indefinitely, until a time when the ECJ responds to the questions posed.