- EC gives German state the green light to join the much-criticized Germany Gaming Treaty.
- New provisions expected to come into effect from March 7.
- Existing licenses issued in SH will remain valid for their 6 years, and pending applicants will still be processed.
The ruling coalition government of Schleswig-Holstein (SH) has announced that it will hold a vote on joining the German Interstate Gambling Treaty in spite of EU Commission opinions that the Treaty may be in breach of EU Law. The government is expected to win the vote.
The EU raised numerous objections but, after a short extension, allowed the review period to lapse without ruling against SH’s decision. The parliament is scheduled to vote on the issue on January 23, according to reports.
It will be the last German state to sign up to the treaty and following parliamentary approval is expected to enforce its provisions from March 7.
SH already has its own gambling regulation, approved by the EU Commission as being in line with EU law and treaties. 27 licenses for online sports betting, casino and poker have been issued, and many more applications are pending.
The federal gaming treaty that it seeks to join, however, permits only 20 online sports betting licenses.
Recent elections brought to power a coalition government that opposes the previous government’s new gaming policies. They have unsuccessfully sought to block license applications under the current law and committed to joining the rest of the German states in applying the Interstate Treaty.
Unable to block the existing law, SH has awarded, and will continue to process, gaming licenses valid for six years. 12 licenses for online casinos and poker and 15 for sports betting have been awarded, with PokerStars, 888, and bwin.party among the recipients.
SH is bound by its existing law to honor these agreements, and until the Interstate Treaty comes into force, must continue to process license applications. 18 casino applications and 24 for sports betting remain pending.
Germany will have two concurrent sets of gaming laws. A case is progressing through the German Supreme Court which will rule whether this state of affairs is constitutionally legal. Meanwhile, the licensed providers in SH are restricted to offering services to SH residents.
The EU Action Plan on Online Gambling set up an expert committee to examine national gaming regulations which is due to report back in two years’ time.
The original SH regulatory framework met with the EU Commission’s approval, but the Interstate Treaty has not. The Commission has been critical of the treaty and has proposed amendments to bring it into line with EU law.
The new SH government is risking the prospect that the EU will take enforcement action against the Interstate Treaty and force it to adopt regulations in line with those it wants to abolish. The establishment of the expert committee makes it unlikely that the EU will act for at least the next two years.
Meanwhile SH is seeking hundred of millions of Euros in structural funds to develop its tourist industry. A government paper on its strategic priorities for its relationship with the EU makes no mention of betting, gambling or the Interstate Treaty.
The European Gaming and Betting Organisation (EGBA), which lobbies on behalf of many of the major online poker providers, has formally complained to the EU Commission about the German Interstate Treaty.
General Secretary Sigrid Ligné vehemently condemns the treaty and urges the EU to take action quickly, noting that the German treaty has “many provisions which are in conflict with EU law” warns that such protections “... effectively slam the door in the face of EU operators from other member states …. extend[ing] the monopoly for offline to online games.”
This article was originally published on Monday, Jan 8, but was later removed due to inaccuracies in the analysis. Following the government’s recommendation and schedule of a vote on Jan 9, the article was republished on Jan 11 with modifications to reflect the latest developments.