Baden-Württemberg Legalizes Online Casinos with State Monopoly

Baden-Württemberg has become the third German state to legalize online casino games, following Bavaria and Schleswig-Holstein. With the approval of amendments to the Landesglücksspielgesetz by the Landtag of Baden-Württemberg, the state is set to launch a state-run online casino platform offering blackjack, roulette, and other virtual table games. Officials argue that this move will curb illegal gambling, ensure player protection, and generate tax revenue, but critics raise concerns over monopolization and potential addiction risks.

A State-Controlled Monopoly for Online Casinos

The German Interstate Treaty on Gambling (GlüStV 2021), which came into effect in 2021, permitted each state to regulate virtual casino games independently. While online slots and sports betting had already been legalized, the regulation of table games such as roulette and blackjack remained at the discretion of individual states.

With this new legislation, only one online casino will be allowed to operate in Baden-Württemberg, exclusively run by Staatliche Toto-Lotto GmbH. Interior Minister Thomas Strobl defended this decision, stating:

He emphasized that a state monopoly ensures better oversight, as experience has shown that public institutions prioritize consumer safety over profit. The platform will only be accessible to residents of Baden-Württemberg, with players required to register their official address

Taxation and Revenue Model

The law introduces a tiered tax system for online casino revenue:

• 15% tax on monthly revenue up to €300,000,
• 20% tax on revenue between €300,000 and €750,000,
• 25% tax on revenue exceeding €750,000.

This taxation model is expected to generate substantial revenue for the state, while also discouraging unregulated offshore gambling. The move aligns with the broader goal of Germany’s gambling treaty, which aims to steer players toward legal platforms that prioritize consumer protection and transparency.

Strict Player Protection Measures

Baden-Württemberg’s online casino will be subject to some of the strictest regulations in the world, mirroring existing restrictions on online slots:

• A €1 stake limit per spin,
• A mandatory five-second delay between spins,
• A €1,000 monthly deposit limit across all operators, which can only be lifted following income verification and credit checks.

Additionally, the government will establish a specialized gambling addiction prevention unit, called Fachstelle Glücksspielsucht Baden-Württemberg, which will coordinate research, public awareness campaigns, and support services for players at risk of addiction.

Political and Industry Reactions

Not everyone supports the state-controlled monopoly model. Sascha Binder, a gambling policy expert from the SPD, questioned whether the state's limited resources could effectively monitor gambling compliance. Daniel Karrais from the FDP criticized the lack of private competition, stating:

“I believe the government chose the monopoly model because it ensures maximum financial gain for the state, unlike a licensing system”.

Meanwhile, gambling addiction experts have raised concerns that state regulation alone won’t reduce gambling harm. Klara Metzger, an addiction prevention specialist, argued that increased advertising for legal gambling platforms could lead to higher addiction rates. She advocated for tighter advertising restrictions and clearer warnings on gambling risks.

Enhanced Enforcement and Compliance Measures

In addition to regulating online casinos, the new legislation introduces stricter oversight on gambling establishments. The Regierungspräsidium Karlsruhe will create a dedicated gambling enforcement unit, staffed by 13 officers responsible for inspecting betting shops and gaming halls.

Officials also plan to enhance consumer protection through test plays and undercover investigations to identify operators who violate regulations. This includes covert inspections of online platforms to verify compliance with responsible gambling measures.

Germany’s Evolving Online Gambling Market

Baden-Württemberg’s move is part of a broader shift in Germany’s online gambling landscape. Bavaria was the first state to legalize online table games in April 2024, followed by Schleswig-Holstein in September 2024. Each state has chosen its own operating model, but Baden-Württemberg’s strict monopoly approach is now among the most regulated in the country.

Germany’s online gambling laws have faced criticism for being too restrictive, with some arguing that highly regulated markets push players toward illegal operators. However, state officials insist that a legal, tightly controlled alternative is necessary to reduce black-market gambling and ensure player safety.

With Baden-Württemberg now joining Bavaria and Schleswig-Holstein, Germany’s online gambling market is undergoing a significant transformation. The state-run monopoly model aims to maximize consumer protection while ensuring substantial tax revenue for the government.

However, debate continues over whether a monopoly is the best approach or if a licensing system with multiple operators would create a more competitive, player-friendly market. As the regulatory framework takes effect, the success of Baden-Württemberg’s online casino model will be closely watched by other German states considering similar legislation.

Sources:

Roulette im Netz - Baden-Württemberg erlaubt Online-Kasinos, landtag-bw.de, February 19, 2025.