Decision on German betting permits.
A decision by the Darmstadt Administrative Court has nullified the German licensing process for online sports betting. This came as a result of a lawsuit filed by the Austrian betting company, "Vierklee," which asserted a lack of transparency and discrimination in the licensing system. The German Sports Betting Association (DSWV) expressed their disapproval. Could bookmakers now be pushed back into the legal void?
An "unpleasant" situation
DSWV President Mathias Dahms commented on the recent developments in the German sports betting scene, stating, "The court's decision is a severe blow for our members." The ruling by the Darmstadt Administrative Court implies a "significant delay" for international operators who have been waiting since 2012 to enter the regulated German market. The DSWV stated in a recent press release:
"Although we were assured concessions by the legislature in 2012, an imminent issuing of a license, which the Interstate Treaty on Gambling, which has been in effect since the start of this year, should allow, is now again uncertain. What's particularly frustrating about this is that licenses could have been issued long ago."
Dahms further explained that the current situation is "dissatisfactory" for all involved and that it's also an "avoidable" situation. The responsible "gambling college" has been unable to reach an agreement for weeks, despite "applications ready for decision" being on the table. Sports betting providers are once again being denied access to a regulated market and thus also to legal clarity. The press release continued:
"The applicants have invested a great deal of effort and energy in the process and have prepared themselves for the regulated market. Yet, I also feel sorry for the employees at the Hessian Ministry of the Interior and the Darmstadt Regional Council, who have worked hard over the past few months to finally conclude the licensing procedure."
Consequences remain uncertain
The fact that a betting company from Austria, which is not a DSWV member, managed to file a lawsuit against the German licensing process comes as an unexpected hurdle along the path towards a compliant, European legal status. According to Dahms, the court's decision casts doubt on whether the operators will ever adhere to the regulations provided by the new Interstate Treaty on Gambling.
However, the final ruling of the administrative court remains unknown. The gambling committee in Hesse, consisting of 16 decision-makers from the state ministries, stated that they would assess the ruling after its definitive publication. The possibility of filing an appeal is not ruled out. The committee stated:
"We confirm the judgment. However, we cannot tell you anything about the consequences at this point, as we don't know the detailed reasons for the decision yet. But we will definitely examine whether we will appeal against the court ruling."
Back in December 2019, the panel had advised international bookmakers against offering online sports betting without a German license in 2020. In February, it was announced that unlicensed websites would be blocked, with up to 99% of betting providers expected to migrate to the legal market. Approximately 30 providers submitted applications, and another 20 indicated their intention to do so.
"We hope that the authorities will be able to continue the licensing process promptly," concluded the DSWV. The association represents 16 members and, as such, accounts for around 80% of the German sports betting market, according to its information. As a point of contact for politics, sport, and the media, the DSWV has been advocating for a modern, competitive sports betting industry in Germany for years.
Is another regulation marathon on the horizon?
Whether the authorities can advance the licensing process now hinges heavily on the extent to which the points of criticism raised by Vierklee can be resolved. If there's no resolution, operators could once again be forced into a legal grey area. That being said, the new regulations were the result of years of discussions on the legal adjustment of online gambling.
Until now, online gambling was legally forbidden in Germany. The state held the monopoly on lottery and sports betting. The EU-licensed providers were caught in a legal quandary. Schleswig-Holstein, however, broke free from the restrictions of the original State Treaty on Gambling in 2011 and started issuing licenses to reputable online providers.
The regulation of German online gambling has been a hot topic since the beginning of March at the very least. The so-called Gambling Re-Regulation Treaty provides for the legalization of online casinos and online poker from July 1, 2021. The special rules for online sports betting, which have been in effect since the start of 2020, are set to be transferred from the third Interstate Gambling Treaty to the new legislative catalog.
At the Conference of Minister Presidents on March 12, the decision was made to enact the gambling amendment. The aim of the nearly 70-page draft is to direct the market, which has been flourishing for years, into EU-compliant channels and to generate increasing tax revenue. Last but not least, legalization would offer enhanced player protection. It remains to be seen if the Administrative Court's decision will trigger yet another marathon of regulation.
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Source: www.onlinecasinosdeutschland.com
