The new coalition government in the German federal state of Schleswig-Holstein is aiming to abolish the Gambling Act under which bet365, Betfair and bwin received sport betting licences last month.
Seven private operators were licensed by Germany’s northermost Land to offer sports over the internet until 2018 under the outgoing CDU-FDP coalition’s Gambling Act. The Ministry of the Interior announced when issuing the last four licences on 23 May that it was considering 24 other applications for sports betting and 17 for casino games, including online poker.
But the new ruling coalition consisting of the SPD, Green Party and the SSW Danish minority parties due to formally assume power today has declared its intent to repeal the law and opt SH back into the Interstate Gambling Treaty backed by the other 15 German federal states (G15).
According to the coalition’s draft manifesto, published this week: “The aim of the State Government of Schleswig-Holstein is the federal regulation of gambling and for Schleswig-Holstein to join the Interstate Treaty of Gambling. The state government will examine how Schleswig-Holstein’s gambling law can be repealed without being liable to pay damages, and how an amendment of the Act will allow – with respect to competition law – the cessation of the licensing procedure.”
Legal experts argued following the issue of the first licences to Betfair, Oddset and MyBet on 3 May just days before the CDU-FDP lost power in the national elections meant the SPD and Green Party potentially had to weigh up the huge costs of paying damages to operators if they pursued their pre-election pledge of repealing SH’s Gambling Law. The Green Party also stated ahead of the election that despite their opposition to the Gambling Act, they would not back a policy where taxpayers’ money was used to compensate gambling operators for their losses.
Lawyer Henrik Armah of Olswang also told Casino Choice: “How and when the new Government is going to implement these intended changes remains uncertain. The coalition treaty still requires the three parties’ general assemblies’ blessing. Thereafter, the new Government will be elected by the new Parliament on 12 June before the legislation could be amended. Note that the new coalition has only a majority of one single vote. Also note that strictly speaking the competent authority remains bound by the existing Gambling Act until and unless it is formally altered or abolished.”
The Berlin-based lawyer added that faced with the spectre of possible legal action from the seven operators already licensed in SH, the government could potentially “try to maintain these 7 licences despite joining the Treaty of the other 15 states.” This course of action may not however not close off the possibility of action from operators awaiting licensing based on unequal treatment of applicants.
Schleswig-Holstein was the only one of the 16 German federal states not to sign up to a new five-year Interstate Gambling Treaty last year under which the G15 plan to issue no more than 20 licences for private sports betting operators based on an unworkable 5% turnover tax. SH is issuing unlimited licences to operators for all products based on a 20% gross profit tax (GPT).