European Commission Has “Serious Doubts” Over Germany’s New Proposed Gambling Law

The European Commission has raised “serious doubts” over Germany’s new proposed gambling law.

The German federal states have pushed forward a proposal for an overhaul of the current gambling legislation, but as the draft includes several severe limitations to both the number of licensees and the scope of new operations, the draft has since been met by heavy criticism from the igaming industry.

The proposal was supposed to replace the existing state monopolies on for instance online sports betting, but due to the restrictions as well as to a proposed 16.66% turnover tax, operators like Betfair and bwin.party have raised their concerns, arguing that the new draft will fail to open up the German market in line with EU law.

The concerns have now been heard by the European Commission, who has given the 16 German federal states who have agreed to the deal one month to respond to the doubts or face the possibility of infringement proceedings.

Martin Cruddace, Betfair’s legal and regulatory adviser, was among the first to welcome the Commission’s response, saying that he was “pleased and encouraged” to learn that the Commission shares the same opinion as Betfair, and that it was “clear that the proposals put forward by the German Länder were discriminatory, anti-competitive and therefore incompatible with EU law.”

Cruddace said: “Although the federal states claim to be opening up the market for sports betting, the current draft treaty contained a raft of protectionist measures designed to keep private online operators out of the market.

“We now expect the German draft law to be amended so that it genuinely caters for a competitive online gambling market in Germany, and will subsequently ensure the highest standards of value, integrity and security for German consumers.”

The decision by the European Commission to fight the German draft law comes just a few days after another similar dispute over regulation changes broke out between Greece and Malta.

The Maltese government here issued similar complaints about a restrictive and “overly cautious” proposal put forward by the Greek government, threatening to bring the case to European Commission if the draft is not amended.

As it is the case with the German draft, the core of the dispute between Greece and Malta is restrictions put on private operators, which according to the Maltese government will make it harder and not easier for companies to enter the Greek market.