Germany’s regulators tasked with regulating and overseeing gambling activities taking place in the country could craft some transitional regulations in relation to the provision of online casino and poker services instead of sanctioning operators providing such services.
This follows the recent suspension of a court case brought by an online gambling operator contesting a prohibition order issued by the Regional Council of Darmstadt.
The Darmstadt Regional Council is the body tasked with accepting and processing license applications and issuing sports betting licenses under Germany’s Third State Treaty on Gambling that took effect earlier this year.
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The Legal Challenge
The Chairman of the German Association for Telecommunications and Media (Deutscher Verband für Telekommunikation und Medien, DVTM), Renatus Zilles, announced Monday that the Darmstadt Administrative Court has suspended a proceeding involving a “private gaming provider” and the Darmstadt Regional Council at the mutual request of the two involved parties.
As mentioned above, the case was brought by the gambling operator as it sought to challenge a prohibition order issued by the Regional Council. The council sanctioned the gambling company for providing online gaming services across Germany.
Under the country’s Third State Treaty on Gambling, a temporary framework that is set to be replaced by a permanent law in mid-2021, online casino and poker products are illegal in 15 of Germany’s 16 states, with Schleswig-Holstein being the only place these are permitted.
According to media reports, the unnamed operator and the Regional Council reached an accord to have the legal challenge suspended and to instead come to “a mutually acceptable and constructive solution for designing a transitional regulation” that will remain in force until Germany’s new, permanent, gambling law takes effect on July 1, 2021.
The Darmstadt Regional Council will thus take “no enforcement measures” against the involved gambling operator during the suspension.
What does the suspension of the case mean for the ongoing reorganization of the German market?
The suspension of the legal challenge could effectively be putting an end to German regulators’ efforts to sanction online casino and poker operators and force them out of the local market.
Dr Stefanie Fuchs of Hambach & Hambach, a leading gambling law firm, noted in the gambling operator’s defense that the services it provides are anyways set to become legal next year and that penalizing the company for offering these services in Germany could be contrary to European Law.
Mr. Zilles said Monday that the suspension of the case should prompt the heads of Germany’s 16 states to craft transitional regulations for the permanent State Treaty on Gambling.
The DVTM chairman noted that Germany “can no longer afford this permanent blockade” as it only “helps illegal operators from Asia and the Caribbean, who are not interested in protecting children, consumer protection or addiction prevention and also pay no taxes.”
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