This summer, online gambling (like online casinos such as play88 casino and sports betting) should have been officially permitted in Germany however under state supervision. The approval of the state parliament is still missing and the concerns are great.
The negotiations were complicated and took years. Because gambling in Germany is a matter for the federal states, and the EU has a say. In the end, the Prime Ministers signed a new State Treaty on Gambling, which is to come into force on July 1st. The most important innovation: For example, the state wants to legalize poker rounds on the Internet under supervision. Because online gambling was usually only possible in a legal gray area in Germany. Offers are currently tolerated subject to conditions.
A lot of money is at stake
In 2019, gambling providers with legal gaming, i.e. analog and not on the Internet, turned over a total of more than eleven billion euros. So it is in the annual report of the happiness supervisory authorities of the countries. Or to put it another way: That’s how much money gamblers have lost in Germany. The largest share still has devices in amusement arcades: The report shows a total of five billion euros in taxes for 2019.
According to figures from the European industry association EGBA (European Gaming and Betting Association), online gaming providers in Germany have turned over around 2.7 billion euros. This makes Germany the most important EU market after Great Britain – and the trend is rising. Most of it went past the German tax authorities.
Problem: Online gambling addiction
The primary goal of the State Treaty is to “prevent the emergence of gambling addiction and betting addiction“. But search experts doubt that this will be possible with the new set of rules. The Advisory Board for Gambling Addiction, an independent body of the federal states, rejects the contract. The experts fear that the legalization of the online market could drive more people into gambling addiction. In a study by the Federal Center for Health Education (BZgA), more than one in three respondents between the ages of 16 and 70 stated that they had gambled online before.
The psychologist Klaus Wölfling from the outpatient clinic for gambling addiction at Mainz University Medical Center is hardly surprised: “Since 2016 we have been observing in Rhineland-Palatinate that online gambling among addicts is on the rise.” The proportion of online gambling addicts in the country rose from almost ten percent in 2016 to almost 25 percent of all gambling addicts in 2019. According to the BZgA, 430,000 people across Germany have at least problematic gambling behavior. The corona crisis and the lockdown increased the risk of addiction.
Politics in a bind?
Löwen Entertainment, based in Bingen in Rhineland-Palatinate, wants to apply for online licenses, even if the requirements are very strict. “This consumer nuisance will have the consequence that many gamblers will refuse to switch from the existing illegal to the legal offers,” says Daniel Henzgen from Löwen Entertainment. The contract, for example, stipulates a stake limit of 1000 euros – and personal registrations for player protection. Löwen Entertainment is also one of the largest manufacturers of gaming devices in Germany. The state treaty provides for stricter rules for stationary gambling halls, which must be specifically designed by the federal states. “As a result, in the midst of the toughest economic crisis of the post-war period, thousands of jobs are being destroyed and entrepreneurial livelihoods are being destroyed,” says Henzgen.
Stricter distance rules between casinos, for example, recently failed in the Mainz state parliament. Not only because every second casino in the country would be on the verge of extinction, but also because the municipalities fear more than 20 million euros in tax revenue. The situation is similar in many other federal states.
Criticism from privacy advocates
According to data protectionists, the regulations for player protection go too far. It’s about a lock file in which locked gamers are to be recorded. “It is worrying that this also affects non-pathological players and that the data can be passed on to the authorities without precise restrictions,” explains the data protection officer of Rhineland-Palatinate, Dieter Kugelmann.
In the future, this data is to be stored in a central authority based in Halle in Saxony-Anhalt. Because the contract also provides for new regulation of the gambling supervision. That is why the approval of the state parliament in Magdeburg is also mandatory. A total of 13 federal states have to approve the contract by the end of April for it to come into force. Time is of the essence because so far only Bavaria, Baden-Württemberg, Rhineland-Palatinate, and Brandenburg have done this. Whether the state treaty really comes into force in its current form in the summer is probably also a matter of luck.