German operators begin online casino transition period

| By Robin Harrison
Germany’s transition period, in which operators will be permitted to offer heavily restricted forms of online poker and slots without fear of prosecution, is now underway, and the industry has until 15 December to comply with new regulatory conditions.
Germany

Under this agreement, the terms of which were agreed by state lawmakers in September but not confirmed until earlier this month, operators have been required to remove all table games from their German-facing sites. 

This vertical, under the Glücksspielneuregulierungstaatsvertrag (GlüNeuRStV), is tightly controlled. The legislation allows states to hand their lotteries a monopoly for the products, or if private operators are permitted to offer them, may only award as many licences as there are land-based casinos in their borders. 

Online slots will be subject to a €1 per spin stake cap, with multiplay functionality removed, and five second intervals between spins. 

Across all tolerated forms of gambling – ie, sports betting, poker and slots – a €1,000 monthly spending cap must be imposed. A small number of customers can apply to have this limit raised to €10,000 or €30,000 provided they undergo enhanced due diligence checks and ongoing monitoring of their activity. Advertising casino products will also be prohibited under the agreement.

While it initially looked as if the industry was being expected to make all these changes by the 15 October start date – effectively two weeks after it was announced – there appears to be a two-month window to implement the €1 slot stake cap and spin. Other elements such as the player protection controls are to be put in place for the beginning of the transition period. 

The initial announcement had prompted criticism from operator association the Deutscher Sportwettenverband (DSWV), which pointed out that the industry was being asked to complete projects that could take months in a matter of days. 

However, Tipico has already announced that its systems are now fully compliant.

“Online gambling enjoys great popularity worldwide,” the operator’s chief regulatory officer Karin Klein said. “The transitional regulation in force since today (15 October) is an important step towards clear and reliable regulation for consumers, operators and authorities. 

“It is important that the rules are now also enforced against all market participants.”

How these rules will be enforced remains unclear; local media reports that states have not yet agreed upon whether compliance will be monitored by any specific authority. Furthermore, with some concerned about the compromise agreement, it remains to be seen whether some states will avoid any involvement before the GlüNeuRStV comes into force from July 2021. 

The launch of the compliance period comes after an eight year process to award the country’s first sports betting licences, under the third amended State Treaty on Gambling (Glücksspielstaatsvertrag) came to an end, with 15 brands licensed. 

This was made possible by the Hesse Administrative Court throwing out an injunction handed down in late March, which brought the process to a halt. 

Again, questions remain over deadlines for operators to comply with the terms of the Treaty. GVC has estimated that it will take until early 2021 to make its systems compliant and impose controls such as spending limits, but it is likely that Hesse, which handled the licensing process, will demand an accelerated timetable.