The online gambling scene has long been somewhat sketchy, with much of the gaming happening on international sites that were not licensed within the country. To this date, the only operators who could apply for licenses were those that offered sports betting, but this has all changed with the latest gambling regulations from March 2020. Until now, even the German law officially prohibits online gambling, these managed to thrive. How is that possible you ask? Well, based on the freedom of services that was regulated by EU Germany didn’t have the option of prohibiting many online casinos that were hosted by The Isle of Man, Gibraltar, or Malta.
According to the new law, all online gambling operators will be able to apply for licenses, including online poker sites and online casinos, which you can expect to see listed at CrushingCasinos. However, numerous restrictions will be put into place in addition to the sports betting markets being limited to the final result and the next goal scorer.
We take a look at how the new gambling regulations will change the shape of the online gambling industry in Germany and what restrictions players will be looking at when playing on legal sites as opposed to the unlicensed international sites.
Ratification Process Underway
While the federal government has agreed that the new “Glücksspielneuregulierungsstaatsvertrag law” should work for everyone, each state government must ratify it before it is actually brought into power. This process has now started but may take some months to complete. Either way, the actual law will not be enforced until 2021.
In the meantime, the licensing process has already begun for sports betting sites, with 30 of them already having applied for licenses and another 20 announcing their interest. These are the only operators who can get the license before June 2021 and we can expect them all to be approved. This seems fair because the country gives enough time for online casinos to apply and get into legal waters.
Once this process is completed, many of the 50 operators who are looking to offer sports betting will likely look to extend their licenses for casino and poker games in late 2021. However, it remains to be seen how much of the market share will be taken away from illegal sites, considering the strict restrictions that the government is imposing on legal ones.
What Restrictions Are In Place?
According to the currently existing third State Treaty and the new gambling regulation, there are a number of restrictions for licensed online gambling sites. This starts with a strict EUR 1.000 deposit limit for all players, which immediately restricts against high stakes action.
The sports betting markets are limited to the final result and the next goal scored, taking away many player options and making it less likely for players to go all out chasing silly bets. For slot players, the maximum stake per spin will be EUR 1 and the autoplay option will be removed, along with jackpots that lure players into playing for the big money. These kinds of slot games can’t get here soon enough, with the stay at home recommendations still in place in May 2020.
Casino games other than slots will have to be offered separately of the slot machines and some states may decide to monopolize these, only offering them through the state lottery. All of this means that the online gambling market in Germany will be quite different from what players are used to and some of them may not like it all that much.
What About Advertising?
After knowing all of the restrictions that are imposed by the new law that will completely legalize online gambling in Germany, there is the question of advertising. There are three key points related to this law.
- The advertisement of operators will not be allowed between 18.00 and 21.00.
- S-H licenses that are currently active, will not cover the nationwide advertising.
- The advertising of virtual slot games, considered “free-to-play”, is going to become fully illegal.
All of the applicants will need to work within this rule in order not to break the law. What would be the consequences of breaking these rules is not fully known.
Will Illegal Market Survive?
The current illegal online gambling market in Germany is made up of offshore sites that offer games to German players. We’ve already listed all of the locations where these are hosted. At the same time, the taxation on a corporate level will be performed in the country that is listed as the residence of the operator of the website. These sites are not illegal in their jurisdictions and are acting in a gray zone, which means they cannot exactly be shut down by the German authorities. At the same time, Germany cannot create prohibit its citizens from taking part in gambling through these websites.
No matter what happens with the licensed sites, it is likely that some of the offshore operators will persist and will continue to get traffic from some Germans. We can say that a lot of the players will not even see the difference, because a high number of them developed a habit of playing on certain websites. However, the legal sites will offer the security that offshore ones cannot and most players should see the benefits from the imposed restrictions. One of the main advantages that the players will be provided with is the security when it comes to the method of payment. Until now, this has been pretty uncertain, and nobody guaranteed that all of the personal information that the player gives to the website is not going to be used for some illegal act.
Germany has also announced that it will be taking serious enforcement action against the offshore operators and has already begun to do so. Some 10 operators have already withdrawn from the market and some others are likely to follow, but it is unlikely that the illegal betting market will be gone anytime soon.