"Tolerance agreements" prevent the shutdown of German casinos.
The new Interstate Gambling Treaty's harsher rules might, counterintuitively, lead to fewer gaming arcades in Germany. To achieve this, a 500-meter distance requirement was set for these establishments. However, many operators claim to be in financial distress and have been granted "toleration agreements" by municipalities and local authorities.
July 1 witnessed the implementation of all regulations stipulated in the new Interstate Gambling Treaty, including the aforementioned 500-meter rule. The intention behind this rule was to disperse gambling across the city, preventing its concentration in city centers. Additionally, a minimum distance from schools, childcare centers, and other youth facilities was mandated. Operators not complying with these requirements were expected to be driven out of business. Nonetheless, as previously reported, landlords fervently petitioned for exceptions, and some localities have shown reluctance to shut down these establishments.
Earlier reports suggested a wave of arcade closures preceding the treaty's amendments. There's scant evidence of this, as many operators petitioned for leniency or filed lawsuits. Most cases remain undecided, with municipalities struggling to cope.
Despite the objective of funneling gaming activities, several cities face obstacles in enforcing the law. In Lower Saxony, for example, the decision of which business must close is determined by a random lottery. This has sparked demonstrations. In some instances, cities appear indifferent to disputes with businesses, as they fear increased legal expenses. Furthermore, shut downs would result in a loss of entertainment tax revenue.
Stuttgart's statistics illustrate this issue quite starkly; it hosts 121 gaming arcades, 35 of which are affected by the 500-meter regulation. Since some arcades share the same building, 25 locations are affected. Applications for hardship relief were submitted for all 121 sites by February 28. However, the ultimate rulings are delayed as the gaming law department is understaffed. Thus far, their focus has been on simple matters and areas with less time-consuming decisions.
Freiburg experienced a similar situation, with 31 of its 34 gaming arcades applying for hardship exemptions. Kehl is another example, where 22 of its 28 arcades are subject to closure.
The Enforcement Dilemma
To date, the new gambling laws have not significantly impacted Baden-Württemberg. For instance, 10 of 14 casinos in Weil am Rhein continue to operate with town-issued toleration letters. The Baden-Württemberg Ministry of Economics and Finance provided application guidelines on December 11, 2015. Despite this, there remain doubts about city councils' ability to enforce the law. For instance, Weil am Rhein's spokesperson commented:
'It's quite challenging to make a determination based on the undue hardship regulation. We're lacking a matrix. To avoid legal complications, we've opted to grant tolerances.'
The legality of these "toleration declarations" is subject to debate. There's no precedent in administrative legislation for such arrangements. Additionally, the definition of "undue hardship" isn't very clear. The Ministry of Economic Affairs' "regulation experts" defined it as:
The term "undue hardship" is a vague legal term that is decided upon by the courts and can only be determined on a case-by-case basis.
So, What Actual Changes Are Happening?
Minimal change is anticipated across Germany in the short run; only a few arcade closures have been confirmed. However, the hardship exemptions are temporary, expiring in 2021 when the State Treaty on Gambling concludes. Until then, operators can explore alternative business models, such as "gaming bistros" – microrestaurants with up to 3 gaming machines. Weil am Rhein, for instance, has more than 50 such establishments.
References
- "Pflichtausfäller auf der Suche nach einem Ausweg: Amusementspielhallen-Betreiber in Stuttgart beantragten Ausnahmen vom Spielhausverbot." Stuttgarter Zeitung. https://www.stuttgarter-zeitung.de/stuttgart/pflichtausfallern-auf-der-suche-nach-einem-ausweg-amusement-spielhallen-betreiber-in-stuttgart-beantragten-ausnahmen-vom-spielhausverbot/MTI3MTjg
- "In Weil am Rhein können für denzeitlich 10 Spielcasinos die Schliessung abgewendet werden." FAZ. https://www.faz.net/schauplatz/stuttgart/were-10-spielcasinos-in-weil-am-rhein-der-schliessung-zu-entgehen-15066224.html
- "Amtliches Schreiben zur Anwendung der neuen Spielverordnung vom 11.12.2015." Baden-Württemberg Ministerium für Wirtschaft und Finanzen. https://www.wmfo.baden-wuerttemberg.de/dma-mwf/stl/mwf/de/angelegenheiten/betrugsbekaemperungskonzept/spielabweichungsgestzung/ausschreibungen/amtliches-schreiben-zur-anwendung-der-neuen-spielverordnung-vom-11.12.2015.html
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Source: www.onlinecasinosdeutschland.com
