Schleswig-Holstein’s iGaming Juridical Reign Ends

Schleswig-Holstein, Germany’s first and only state to introduce a fully regulated iGaming market in March 2012, terminated the governing and authoritative power of the country’s lone state-bounded jurisdiction on December 21, 2018.

As outlined in the final draft of the Gambling Act, this legislative institution’s undisputed reign in the realm of casino licensing was confined within a time period of 6 years, which, having expired, means that the regulator no longer exists as such, and that local punters can no longer legally enjoy the services of reputable internationally-oriented operators.

Schleswig-Holstein’s Former Commission

Positioned in the northwestern part of the territory, Schleswig-Holstein was considered the heart of online betting in the country, but Germany is still dealing with legal gaming struggles and is certainly not a stranger to multiple regulations of the online gambling laws.

During its active years, thanks to the interstate Treaty’s decision, the number of licenses that could have been granted to eligible applicants were unlimited, issued for a period of two years to allow operating various gambling-related services:

• Online casinos
• Land-based venues
• Lotteries
• Betting…

…while maintaining the integrity of the small market by way of preventing manipulation, fraud and money-laundering.

PayPal a “No-Go”

Last week, a well-known betting operator GVC Holdings PLC, active across B2C and B2B markets, informed its associates that its German-oriented online operators would no longer accept PayPal, a popular low-fee payment method.

In an emailed report to its affiliate partners, the company has announced that PayPal will no longer be available as a banking option for casino users in Germany beginning December 19th.

While the Isle of Man-based giants haven’t provided any facts as to why they have decided to eliminate this transaction service as a payment option in Germany, their resolution is likely to be connected with the country’s complex internet wagering regulatory situation.

This is not the case with GVC Holdings alone. In fact, a number of other companies have been restraining their German-focused operations…

…ever since a 2017 court ruling that banned international operators from offering services to local punters.

The previous week has seen a certain amount of brands following on this same path, among them, the Gauselmann Group’s Merkur Gaming.

…whose German customers were informed that they would lose approach to the site’s online casino, as of the December 18th.

Curious Case of State Government(s)

Both of these new restraints coincide with the expiration of the licenses approved six years ago. Back in 2012, the state entered a dispute with the remaining 15 German states, by not approving the federal gambling treaty, which allowed only online sports betting.

Ever since then, their market has been involved in a continuous struggle, with both international and domestic courts denying the government’s strong attempts to coordinate its two opposing licensing systems.

To clarify…

…two types of licenses are officially accepted: an organizing license, and a distribution license.

A short time later after Schleswig-Holstein issued its licenses, a new state government took control and decided it would sign up to the federal agreement, leaving the prosperity of its licenses unclear.

In 2017, brand new Schleswig-Holstein government implied the matters would remain as they were in its old regime, and again, refused to agree to a revised federal legislation.

So far, there have been no actual declarations regarding the future of those original licenses.

Their catalog includes some of the greats, including Bet365, BetCruise and among others:

• PokerStars
• Bet-at-home,
• Tipico, and,
• Skill on Net

Only time will tell how these operators intend to carry on. Many important legal and operating details are currently left unclear, but the aim of protecting the player’s best interest and the integrity of operators simply needs to be revisited.

Source:

“Germany’s Schleswig-Holstein online casino licenses expire”, Steven Stradbrooke, calvinayre.com, December 21, 2018.