October 20, 2009

German gambling ban could be overturned

Germany’s online gambling ban could be under threat after one of the German states which originally approved the treaty demanded a cancellation over the weekend.
The agreement between the current ruling coalition Christian-Democratic Party (CDU) and the Liberal Party (FDP) in Schleswig-Holstein was published last Saturday; it called for an end to the interstate gambling treaty and asked for a new regulation to replace it.
The FDP and coalition in Schleswig-Holstein leader, Jürgen Koppelin, said that if German states fail to agree on a new regulation to replace the treaty, the coalition would introduce an intrastate licensing system.

Martin Arendts of Arendts Anwalte, a German gaming lawyer said, “The argument that only a monopoly can protect customers, prevent problem gambling and guard against fraud would not hold any more,”

The coalition is only reported to have spoken about the potential impacts of such a move, such as privatizing state owned casinos. Arendts continued that any new licensing system could apply to online gaming and betting as currently all forms of online gambling except horse racing is banned.

EGBA has consistently argued that the protectionist monopoly position of the German Interstate treaty on gambling violates EU law under article 49 of the treaty of Rome as it restricts the rights of its members to provide online gaming services.

Arendts continued to highlight that Schleswig-Holstein only approved the treaty in December 2007 for fiscal reasons as it had previously favoured a different interstate treaty on sports betting which would result in providing licenses for private bookmakers.

If all of the German states fail to ratify a new regulation by 2012 when the current treaty expires it would make the current state gambling monopoly unenforceable.

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