Rhineland-Palatinate: Gaming arcades experience a sense of relief
Gambling hall proprietors in the Rhineland-Palatinate region can exhale a long-awaited sigh of relief: the recent coalition deal between the SPD, Greens, and FDP offers a seven-year timeframe for setting up the controversial 500-meter distance rule for gambling establishments. A hasty and immediate implementation of this rule would've triggered mass closures and countless job layoffs. Could this shift in policy impact other federal states as well?
The 'traffic light' coalition buys time for arcades
A coalition agreement has closed the door on a potential crisis for amusement arcades in Rhineland-Palatinate, at least temporarily. Authorities have given gambling hall and betting shop owners seven years to implement the controversial 500-meter minimum distance regulation. The rule, which entered the German Gambling Act (GlüStV), would've resulted in over 50% of the gambling halls shutting down permanently.
This extension of the previous exemption rule is mentioned in the coalition agreement as the last phase of the transitional period. The amusement arcade industry had predicted the probable loss of 2,500 jobs if the minimum distance was enforced promptly. Moreover, the Association of Cities and Towns worried about losing annual tax revenues that ranged between $20 and $30 million.
The Löwen Entertainment Group, a leader in the industry, hailed the move, criticizing those who wanted to reduce the number of gaming arcades. However, addiction experts expressed their disappointment with the state's decision. Contrary to expectations, the state parliament was thought to be softening up the regulations to suit the gambling industry, as per the State Office for Addiction Counseling.
The minimum distance rule was scheduled to kick in on July 1, along with the GlüStV's enactment. The minimum distance requirement is a part of Germany's new Interstate Treaty on Gambling, which became active in July, following unanimous approval from all states. Each federal state has responsibility for determining the introduction and size of the minimum distance.
North Rhine-Westphalia caused a stir when it announced it would prioritize gaming arcade quality over adherence to the 500-meter distance rule. The association of Austrian vending and gaming machines welcomed the decision, arguing that it would benefit the regulated range of games. Moreover, the GlüStV regulates reputable online casinos, online sports betting, and online poker.
Does the 500-meter distance regulation make sense?
The Rhineland-Palatinate state parliament delayed the final decision on the minimum distance rule earlier this year, just before the legislative period ended. This was due to legal re-examination and analysis of the potential risks and losses. The amendment was necessary to enhance the framework conditions for responsible gambling, but a solution that would satisfy everyone was pursued.
The debate in the state parliament centered on whether the 500-meter distance regulation was truly justified. The Greens were concerned about an increase in gambling addiction, whereas the FDP feared job losses. The SPD oscillated between supporting and rejecting the law. The negotiations in the Committee on Internal Affairs dragged on for weeks without reaching an agreement.
The Association of Cities: A misleading law
Michael Mätzig, director of the Rhineland-Palatinate Association of Cities, stated that the new law is misleading. The draft makes no mention of the potential $20-$30 million in yearly tax revenues that could be lost due to the reduction in amusement arcades, nor does it mention the 2,500 jobs at risk.
Mätzig highlighted that these numbers were well beyond the thresholds that warranted careful consideration. In the current economy, those who lose jobs aren't likely to find new ones. Moreover, most arcade employees are low-skilled workers and mini-jobbers.
Serious consequences of the 500-meter distance
In Rhineland-Palatinate, the 500-meter distance rule would've forced 329 out of the 610 arcades to shut down. The worst-hit city was Trier, whose 20 out of 22 arcades would've been closed. In the Trier region, 36 of the 72 arcades would've faced closure. Four arcades in Bitburg-Prüm and Bernkastel-Wittlich, as well as six in Trier-Saarburg, and two in Vulkaneifel, also faced the same fate.
In various German cities, including Düsseldorf, similar trends have emerged - the reduction in gaming arcades could potentially lead to the disappearance of around 30 establishments, as stated by Paul Gauselmann, CEO of the Merkur company. The city of Berlin is also targeting a decrease from 496 to 120 arcades, with concerns that these establishments would negatively impact their neighborhoods. Criticizing the proposed plan, the Löwen Group expressed intense frustration, claiming it to be a policy of chaos.
The Association of Cities and Towns in Rhineland-Palatinate has voiced concerns that gaming arcade operators won't be able to recover from the current COVID-19 pandemic if new restrictions are imposed. This could result in a permanent shift to online gaming, causing a significant loss to these businesses. As a potential solution, they recommend allowing gaming arcade operators to apply for new licenses, enabling them to adapt better to the changing circumstances. However, the recent extension of the deadline has given operators a temporary reprieve from the pressures.
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Source: www.onlinecasinosdeutschland.com
