German lawmakers back to the drawing board on iGaming

It looks like lawmakers in Germany have finally conceded that their Interstate Treaty on Gambling (“the Treaty”), a law that is largely protectionist in nature, has no future.

Politicians (state and federal) will be gathering to debate a new approach to regulating online gambling at a conference to be held in Berlin this week titled, ‘The Future of Digital Gambling – New State Control?’

The original Treaty, introduced in 2008 was ruled by the European Court of Justice (“ECJ”)to be inconsistent with EU law. A revised Treaty was introduced 2012 but even before it became law, the European Commission issued a detailed opinion on the draft saying it was also inconsistent with EU law.

Perhaps the final nail in the coffin came earlier this month with another damning ruling from the ECJ, in the Ince Case.

Sebat Ince was prosecuted by German authorities prosecuted for offering an online gambling service in contravention of the Treaty (that is, without a local license). The matter was referred by the local court to the ECJ, which handed down its decision on February 4th this year. The court found in favour of Ince, saying an operator couldn’t be penalized for contravening rules that were themselves an infringement of EU law.

“[…] a Member State may not apply a criminal penalty for failure to complete an administrative formality where such completion has been refused or rendered impossible by the Member State concerned, in infringement of EU law” 

Simply put, the Treaty in it’s current form isn’t legal. But then most big operators have been happily accepting players from Germany on this basis anyway.  Some have been actively marketing their services in the mainstream for some time now (eg Betfair sponsorship of Türkiyemspor Berlin).