Controversy Erupts Over New German Gambling Laws


11/08/2011
By Debra SaundersGoogle

 

Recently proposed reforms in Germany’s gambling’s legislation have sparked major controversy and outrage among Europe’s online gambling affiliates.  The new legislation, which is supposed to take effect next July, would have a strongly negative impact on any online gambling site seeking to operate in the German market.

The new proposal is also expected to aggravate the already strained relationship between the European Union and Germany.

The legislation includes a number of reforms that are particularly bad for affiliates looking towards the German market.  These reforms include a limit of 20 online gaming licenses, a turnover tax (a transaction-based tax) of 5 percent, and a limitation of licensing to sports betting (excluding table games like poker).

Though this proposal does not bode well for gambling affiliates, there remains a glimmer of hope.  One of Germany’s 16 states, Schleswig-Holstein, has drafted an alternative proposal that jibes with EU agreements. 

The Schleswig-Holstein legislation, which aims to come into effect as of January, more closely resembles the type of legislation already in effect in much of Europe.  It contains a clause allowing table games, and taxes only gross profits (at 20%).  The Schleswig-Holstein proposal may be the saving grace of the German online gambling market.

The CEO of The Remote Gaming Association, Clive Hawkswood, spoke to the media in order to make the gambling community’s frustration over the new legislation known.  He explained how the German proposal goes against explicit EU agreements.  On the other hand, he praised the proposal of Schleswig-Holstein stating the later does agree with EU standards.  He further added that though the German proposal claims to increase safety via regulation, the proposal actually leaves the market open to unregulated offshore operations.

Since the onset of online gambling, German legislation has never been very favorable, and it remains to be seen what will happen with these reforms.


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