German Online Casino Market Is 'Askew', Executives Say

June 6, 2024
Back
The online casino market in Germany is "askew", with table games separated from slots and a laborious process for approval of slots games, executives have said.
Body

The online casino market in Germany is "askew", with table games separated from slots and a laborious process for approval of slots games, executives have said.

Online operators and their game suppliers face a "massive blocker", an approval process that requires suppliers to get their games tested and approved, and then operators need to get the same games approved individually, said Lars Kollind, the head of business development at Swintt, during iGaming Germany in Munich on June 5. 

"If a game is tested once, why test it again?" he said.

Many licensed operators have been able to get only five games approved after a year of trying, while black market operators have hundreds, he said.

Germany may be the only regulated online gambling market in Europe, and perhaps the world, where online gambling tax receipts are declining, Kollind said.

"That is a catastrophe," Kollind said. "That means the black market has all the games, while the regulated operators still struggle."

"Something is askew; it needs to be addressed and fixed."

Online slots and poker can be licensed across the whole country, but online casino table games such as roulette and blackjack are reserved for the states.  

But only two states, Schleswig-Holstein and North Rhine-Westphalia, are planning licensing programmes for online casinos, with a state monopoly, Lotto Bayern, active in Bavaria.

Those games are also ring-fenced; that is, Bavaria’s roulette can only legally be played in Bavaria.

German online gambling is hamstrung, from an industry point of view, by an interstate treaty that was a political compromise among the 16 German states.

But not all improvements from the operators' point of view would require a change in legislation, some could be made by the regulator, Gemeinsamen Glücksspielbehörde der Länder (GGL), said Jan Feuerhake of Taylor Wessing law firm.

The regulator may not be fully aware of the impact of regulations, such as the fact that at least one big licensee is considering leaving the German market, he said.

"If that happens, it will be a domino effect, if one leaves, several will leave," Feuerhake said. "It will be a boon for the black market."

Without changes, the market could someday be left to three market leaders, gambling giants Gauselmann and  Novomatic, and one more, said gambling consultant Bernd Henning.

"They have the cash to stay in the market," he said.

Improvements are possible, Feuerhake said.

An interim report on the interstate gambling treaty is due at the end of the month, and recommended changes could be in place by the end of 2026, he said.

An audience member asked the attorney if there were any advantages to operating legal gambling in Germany.

"The advantage is, they sleep better," he said.

It is a crime to offer gambling to Germans without a licence, and the GGL has referred a number of operators for a criminal prosecution, he said.

But, Feuerhake said, the enforcement process takes time, and is usually only partly effective, leaving legal operators frustrated.

"It’s not an industry that’s full of crooks, it’s a complicated industry that’s willing to be regulated, like the financial  industry," he said

Our premium content is available to users of our services.

To view articles, please Log-in to your account, or sign up today for full access:

Opt in to hear about webinars, events, industry and product news

To find out more about Vixio, contact us today
No items found.
No items found.