Germany's First Private Online Casino Licenses Awarded in Schleswig-Holstein

In a historic move for Germany’s gambling industry, the Ministry of the Interior, Local Government, Housing, and Sport of the state of Schleswig-Holstein granted four private companies permission to operate online casino games within the region on September 18. This marks the first instance of private operators receiving such authorization in the country, fulfilling the state’s mandate to channel illegal gambling into legal avenues.

The four companies granted licenses include BluBet Operations Limited, Cashpoint (Malta) Limited, Skill On Net Limited, and Tipico Karlsruhe Limited. This step reflects a broader initiative to offer a legal and regulated alternative to unauthorized gambling operations, which have been proliferating in the country’s online market.

A Landmark for German Online Gambling

This decision by Schleswig-Holstein sets a precedent in the German gambling industry, as the state becomes the first in the nation to issue licenses to private operators for live casino and table games. While other German states have been granted the ability to offer online slots and poker through the federal regulator Gemeinsamen Glücksspielbehörde der Länder (GGL), Schleswig-Holstein’s move to license commercial operators for table games signifies an important development in the country’s approach to online gambling regulation.

Interior Minister Sabine Sütterlin-Waack commented on the decision, highlighting the state's goal of providing a safer and more regulated environment for players. “By allowing an attractive online offer, we want to prevent players from taking advantage of illegal offers if they want to play the games they know from casinos online, for example, and thus strengthen legal gambling,” she explained. The newly licensed operators will be required to adhere to strict player protection requirements, ensuring that measures to combat gambling addiction are effectively implemented.

The licensing of these operators stems from the broader framework established by the State Treaty on Gambling (GlüNeuRStv), which came into force on July 1, 2021. This treaty grants each of Germany’s 16 states the authority to independently issue licenses for online casino table games, even though the GGL oversees online slots and poker at the federal level.

The GGL, which replaced the Saxony-Anhalt State Administration Office in July 2022, was created to streamline the regulation of online gambling across Germany. However, individual states, such as Schleswig-Holstein, retain the right to independently regulate certain gambling activities within their jurisdiction, which includes the power to license table games. This dual regulatory structure allows states to tailor gambling policies to their regional needs, and Schleswig-Holstein’s decision to license private operators represents a significant step in that direction.

Industry Reactions to Schleswig-Holstein’s Licensing Move

The decision to license online casino operators has been met with enthusiasm by industry stakeholders. Tipico’s igaming director, Christian Heins, celebrated the milestone on his LinkedIn page, particularly noting the importance of receiving the license in his “home state” of Schleswig-Holstein. Heins also expressed eagerness to engage with casino table-game providers to further expand the offerings.

In Austria, the gambling trade body Österreichische Vereinigung für Wetten und Glücksspiel (OVWG) welcomed Schleswig-Holstein’s decision, praising the establishment of a “safe and controlled regulatory framework” that would help mitigate risks to players. The organization also suggested that the move could inspire other German states to follow suit and implement similar licensing schemes for private operators.

Despite the progress in regulating the legal gambling market, Germany continues to face challenges in addressing the country’s illegal online gambling market. Regulatory delays and advertising restrictions on licensed operators have contributed to the growth of the black market, which poses a significant issue for authorities.

The GGL estimates that the black market accounted for around 4% of the overall gross gaming revenue (GGR) in 2023, including land-based operations. However, industry stakeholders argue that this estimate understates the true impact of illegal gambling. The local trade body, Deutscher Online Casino Verband (DOCV), believes that illegal gambling sites actually account for about 20% of Germany’s online GGR, suggesting a larger problem than previously acknowledged.

The introduction of licenses for private operators like Tipico and Cashpoint is viewed as a critical step toward reducing the appeal of illegal gambling sites by providing players with legal, regulated alternatives. With the additional protections offered under the new licenses, the hope is that players will be drawn away from unauthorized platforms and into safer, state-sanctioned gambling environments.

Source:

''State government allows online casino games'', schleswig-holstein.de, September 18, 2024.